Warning taxpayers at risk if China student boom busts

Australian unis must “wean themselves off their addiction to international students,” warns Salvatore Babones

And by “international” he mainly means students from China.

In a new paper for the Centre for Independent Studies, Associate Professor Babones (Uni Sydney) warns seven universities, “appear to be more dependent on fee-paying Chinese students than just about any other universities in the English-speaking world.”

The seven he sees as especially dependent on China as a source of fee-paying students are; the universities of Melbourne, Sydney, NSW, Adelaide, Queensland, plus ANU and UTS.

Aspro Babones argues at length why the existing system-wide situation is academically (entry via pathway programmes) and financially (budget-dependence on international fee income) at-risk. And he warns, “since international students are overwhelmingly concentrated in Australia’s public universities, this financial dependence constitutes a risk to Australian governments, and ultimately to taxpayers.”

He proposes measures for universities to reduce their exposure, including;

* “reducingreliance on international students to manageable levels, with targets set both for the university as a whole and for individual programs” and

* “reducing “the proportion of international students hailing from any one country to manageable levels, with targets set both for the university as a whole and for individual programs”

However, overall universities would be powerless to stop a major decline in demand;

“If the Chinese government, faced with a currency crisis, were to suspend the convertibility of the yuan for educational purposes, this could result in a severe decline in Chinese student numbers at Australian (and other international) universities. It seems unlikely the Chinese government would take such a precipitate action, but there are no practical limits on its power to do so,” he writes.

He suggests, universities can reduce their need for current numbers of international students by acting on, “obvious areas for fiscal improvement” which are in their power, such as

* “the reduction of deadweight administrative overheads

* increased use of technological multipliers,

* pursuing private philanthropy.

These are all areas “where the route to solvency runs primarily through domestic territory,” he argues.

But he is not optimistic. “Administrators have proved reluctant to cut bureaucracy, academics have proved reluctant to embrace technology, and philanthropists have proved reluctant to invest in universities that refuse to be held externally accountable.”


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