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Australian Universities, International Students and China ASIAASIA TASKFORCE TASKFORCE DISCUSSION INTERIM PAPER REPORT No. 04 NOVEMBER 2020 AUSTRALIAN UNIVERSITIES, INTERNATIONAL STUDENTS AND CHINA Taking Stock and Taking the High Road Asia Taskforce is an initiative of Knowledge partners BACKGROUND This Discussion Paper has been prepared as part of a series of Key points: short reports on specific topics identified by the Asia Taskforce • While there is a demonstrable downside to the university sector’s (Taskforce) – an initiative of the high exposure to the international market in general and to China Business Council of Australia and in particular, the proposition the Australia’s public universities Asia Society Australia together should retreat from the international education market, China with knowledge partners PwC included, and focus wholly or largely on servicing the learning Australia and the University of needs of domestic students is based on a false binary. In the Sydney Business School - to absence of a major increase in real direct government funding supplement the findings and per student, a retreat to educational nationalism would consign recommendations contained the sector to a future of shrinkage, low horizons, reputational in the Interim Report and final decline, infrastructure decay, research mediocrity and minimal report (due out in late 2020). services for local students themselves. • The sector’s critics ask the wrong question, fail to apply root One of the objectives of the cause analysis and proffer solutions that are simplistic and ill- Taskforce was to identify conceived. The key is not whether our public universities should issues critical to business be providers of international education. They should. We must success in Asia. Education now address how the sector can best reposition itself to improve is Australia’s third biggest its international education activities for success, at home and export category. This Discussion abroad, in a post-COVID world. Paper examines the Australian university sector’s involvement • Both the sector and government should embrace the ‘high road’ in international coursework and work in partnership to reposition the sector so that, over the education and, in particular, the course of this decade, our universities can rebuild global brand sector’s educational engagement and reputation, recover their international student numbers, with China, exclusive of reprofile the international student cohort both to improve the academic research engagement. academic merit of students from China and to rebalance the overall load progressively to grow the number of students from target diversity markets. Taking Stock and Taking the High Road | 2 EXECUTIVE SUMMARY COVID-19 has propelled The paper offers an assessment of Australia’s public the sector’s degree of exposure to the international and Chinese ...the“ question should universities, Australia’s markets, weighs up the evidence third largest export and arguments against and for a not be whether this earner, into an existential continuation of this engagement engagement should and proposes that the question crisis and highlighted the continue but, rather, sector’s longstanding should not be whether this engagement should continue how the sector should strategic and structural but, rather, how the sector weaknesses as an should reposition itself to (i) reposition itself...” international education diversify the international student provider. This discussion cohort overall, (ii) capture an paper examines the academically superior segment The paper juxtaposes the Australian university of the Chinese market and (iii) ‘low road’ (domestic reversion) capitalise most effectively on and ‘high road’ (international sector’s involvement in trends that are already beginning repositioning) options, puts the international coursework to reshape the landscape on case for the latter and offers education and, in particular, international education – from five key recommendations for the sector’s educational the transformation of China’s own ‘high road’ action by the sector engagement with China, higher education sector to the rise and a further five for action of digital learning. by government. exclusive of academic research engagement. The choice now confronting the sector is stark: absent a major change in domestic student per capita funding, it can either fall back on current domestic funding levels and be content to be small, research light and offer limited services to domestic students, or it can seek to take in higher calibre international students at scale and cross subsidise both the domestic student experience and academic research. Taking Stock and Taking the High Road | 3 CHAPTER 1 OVEREXPOSED? As well as disrupting Viral Exposé university qualifying for emergency every aspect of university financial support in the form of COVID-19 has hit Australia’s 37 the JobKeeper wage subsidy. life, learning and work at public universities particularly Government support for the tens virtually every university hard. With the inflow of of thousands of international campus world-wide, international students cut students who were onshore at the current pandemic dramatically, campuses are the time of the initial shutdown has also clearly exposed mothballed, and teaching has has been negligible. Rather, the switched abruptly to on-line only signalling from Canberra in the one of the Australian mode. The business model that early months of the pandemic was higher education sector’s has underwritten the sector’s that those on international student deepest vulnerabilities: expansion for more than two visas were no longer welcome here its heavy reliance on fee decades – a model that relied (Doherty, 2020). increasingly on the inflow of revenue from international full-fee-paying international The consequences for students students; a reliance that coursework students – has been and the sector are dire. Tens of is more extreme than disrupted, perhaps irretrievably, thousands of these students were is the case in any major and perhaps entirely appropriately stranded by the lockdown; those competitor country in the according to some critics within onshore were among the first and beyond the sector. The to lose the casual jobs on which international education losses incurred this calendar many of them depended to pay market. That now demands year due to the steep fall in their degree fees and cover living open and honest reflection international student numbers costs in the high-cost capitals of plus a major policy is forecast to be in the range of Sydney and Melbourne, where the rethink on the part of the $3 billion to $4.6 billion (Horne, bulk of international students are 2020), with concerns expressed concentrated. For those caught universities themselves regarding the financial viability of offshore, government plans to and government. some institutions. establish safe corridors to enable their re-entry to Australia have According to the National Tertiary so far come to nothing. Reports Education Union, over 12,000 staff, indicate that international chiefly casual and contract staff, students feel abandoned by the have already lost their jobs (Duffy Government, ignored by their and Sas, 2020), with predictions universities and ostracised by of total job losses ranging up to Australian society (Doherty, 2020; 21,000, including some 7,000 Lehmann, 2020). research-related positions alone – or more than 10% of the sector’s On any reasonable estimate, then, entire workforce (Horne, 2020). the country’s university sector is in Even the asset-rich Group of Eight an unprecedented crisis – and its institutions have been forced to reputation as a prominent provider impose strict austerity measures of international education is under and institute staff redundancy serious threat. The sector’s critics, rounds. So far, government though, argue that this is a crisis support for the sector has been that is self-made and long in muted, with no public sector the making. Taking Stock and Taking the High Road | 4 Insider Predictions of a These elite institutions, he language capability and insufficient Cataclysm in the Making suggests, have pursued revenue savings to succeed as permanent from international students in residents. Revealingly, though, Last year, many months prior order to fund expenditure on Birrell also predicts that, despite to COVID-19, two high profile research, lavish buildings, IT their historically lower load of academics with Group of Eight infrastructure and executive onshore internationals, for non- affiliations, Salvatore Babones, a salaries, primarily to underwrite Group of Eight campuses ‘the Sydney University sociologist, and the sector’s continued success in decline in government funding (in Bob Birrell, ex-Monash University the global rankings arms race. real terms) for domestic students social demographer, each sounded over recent years’ would put the alarm regarding the sector’s Babones expresses concern about pressure on these institutions to heavy reliance on foreign students, the financial vulnerability and expand their international intake with both suggesting that the moral hazard arising from the (2019, p.21). sector would only have itself to high Chinese student presence. blame should the international Birrell (2019) mounts an equally While no thorough consideration inflow suddenly fall. While passionate if somewhat more of the sector’s post-pandemic Babones referred in passing to the measured critique. He avoids prospects and options can possible consequences of a global singling
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