Nightmare scenario looms for higher education — but there’s no obvious solution

Australia faces major losses from its $38 billion export revenue higher education sector unless the government and university leaders can resolve a diabolical problem created by the Melbourne lockdown and the need to further curb what is already just a trickle of foreign arrivals at airports across the country.

And with all international flights to Melbourne suspended, plans to allow at least a small number of foreign students to return to Victoria have been put on hold.

But with major problems exposed in the Victorian quarantine system for incoming travellers, and other states warning their systems were struggling, the federal government is moving to cut down on inbound international travel — which at the moment is almost entirely Australians returning from overseas.

Whether bound for Melbourne institutions or elsewhere, foreign students at this point are a distant second in policymakers’ minds given the nature of the Victorian outbreak.

University leaders are warning that foreign students may be permanently lost to higher education systems elsewhere in the world — and there was already evidence that tensions with China, as well as other factors such as racist attacks, were deterring Chinese students from considering Australia.

Handily, the Trump administration also seems keen on deterring foreign students in the United States — prompting exactly the same warnings from US educators about the impact on demand for a US degree.

But universities in the UK — where borders remain open — remain potent competitors: they offer lower tuition fees and, like Australia, students can apply to work after they complete their study and can access the NHS, though that is offset by a higher cost of living, much greater travel distance for students from Asian countries, and the weather.

The government, sensibly, is considering extending the post-study work visa to students who remain at home studying with Australian institutions online — a de facto recognition that much of the attractiveness of an Australian degree is in the path it offers to working here.

But the core problem remains Australia’s closed borders and an inability to handle large numbers of exemptions requiring quarantine. Before the pandemic, Melbourne alone hosted more than 200,000 foreign students, which gives an indication of the kind of volume of movement any meaningful fix will entail.

For now universities can only offer online tuition, which is a partial fix but doesn’t address the significant secondary economic impacts of an extra several hundred thousand people needing infrastructure, accommodation, food and basic services.

For a government deeply resistant to providing any kind of support for universities, it’s a vexing problem that may have serious long-term impacts on one of our biggest export industries.