Is Australia Increasing Visa Fees for International Students? May Budget Update

Several reports suggest that Canberra is considering raising international student visa fees, currently set at $710, next month. While a Department of Home Affairs spokesperson acknowledged that any changes to visa application fees would be a government decision, there was no confirmation on plans to increase fees.

The spokesperson emphasized the importance of Australia's student visa program in achieving quality education outcomes for international students. They mentioned the Migration Strategy, released on December 11, which aims to enhance the quality and integrity of Australia's international education system.

The Grattan Institute, an independent think tank, proposed raising the visa fee to $2,500 per visa to fund more Commonwealth Rent Assistance for Australian citizens. The institute argues that while international students benefit landlords and the economy, local young people suffer from rising rents due to limited housing supply.

The Grattan Institute has previously advocated for reducing the duration of post-study work visas and raising the English language requirement for temporary graduate visa holders, both of which have been implemented by the government.

While stakeholders agree that international students are not the sole cause of housing shortages, they acknowledge that they have contributed to the acceleration of these issues. However, they argue that other factors such as high interest rates affecting the construction industry are equally responsible.

Recent reports indicate that the fee increase may not be as steep as the Grattan Institute proposed. Phil Honeywood of the International Education Association of Australia (IEAA) warned that any increase above the Consumer Prices Index would make Australia less competitive globally.

The UK's recent increases in health surcharges and visa fees, criticized for exploiting overseas students, serve as a cautionary tale. In response, UK visa fees surged by 35% to £490 last year, making them the highest among popular study destinations.

Despite rumors, detailed information about the fee hike remains scarce, particularly regarding the extent of the increase. However, any significant rise in fees would likely deter students and limit education providers' access to key student source markets.

Troy Williams, CEO of the Independent Tertiary Education Council Australia (ITECA), criticized the potential fee hike as contradictory to the government's stated intent to reduce the size of the international education sector. He emphasized the valuable cultural diversity international students bring to Australia.

Data released by English Australia for January showed a significant decline in visa grant rates for vocational education and English language courses (ELICOS) students, reaching record lows.

Several countries, including Colombia, Peru, Turkey, and China, experienced declines in visa grant rates, further exacerbating the challenges faced by the sector.

The uncertainty surrounding visa processing and unexpected rejections have contributed to a decline in share prices for education companies. For instance, NextEd's share price dropped by 81.76% in the past year, while IDP Education saw a decline of 41.73%.

Analysts predict a challenging road ahead for the sector, with no improvements in visa grant rates across various countries. Both India and Pakistan have witnessed declines in visa lodgments and grant rates.

There are concerns that the combination of increased English requirements and visa fees will slow down markets in Latin America. However, the ELICOS and vocational education and training (VET) sectors are expected to face a pricing war due to the current climate.

Williams urged the government to align its international education strategy with its migration strategy. He highlighted the inconsistency between encouraging international students to study in Australia while simultaneously implementing measures that deter them.

Although there are fears of a potential cap on international student numbers, it is unlikely to be included in the May budget. However, discussions on this issue may occur in the future.

Williams warned that measures such as raising visa application fees would threaten the livelihoods of many Australians employed in delivering high-quality education to international students.