Jane Prentice (Ryan, Liberal Party) Share this | Hansard source

International students bring huge benefit to the Australian economy, both socially and economically. That is why the Education Services for Overseas Students Legislation Amendment Bill 2010 is of such importance. It will enable the Commonwealth Ombudsman to establish an independent body for overseas students to make complaints against private registered providers, offer advice and training to private institutions to facilitate best practice complaint handling, and review and investigate complaint handling and report on systemic issues.

Whilst I do not generally support simply applying another layer of bureaucracy to try to fix an issue, I believe that these amendments will provide much needed transparency and reassurance to international students in Australia who are currently feeling threatened by the Gillard government’s recent actions.

Education services are Australia’s third largest export earner, second only to coal and iron ore. For a relatively small country, Australia hosts a high portion of the world’s international students. In 2006, there were almost 2.8 million tertiary students studying abroad, with just over 207,000 studying in Australia—7.5 per cent. Additionally, international students study not only at our universities but also through business schools, English language study institutions, through the VET sector, on study tours, and through foundation courses to prepare them for further study. In doing so, they contribute to a wide and diverse range of sectors even within the education industry, and the benefit of this becomes clear when looking at their contribution to the overall economy.

Access Economics reports that each international student contributes approximately $29,000 per annum, on average, value added to our economy. This means that overall, including associated visits from their friends and family, international students contribute $12.3 billion value added. While students spend about 46 per cent of their expenditure—$6.4 billion—directly on their education, they also spend money on other items such as food, accommodation and travel. Again, based on an average $14.3 billion value added, it is estimated that for every dollar an international student spends on their education, there is a flow-on effect. This in turn, of course, generates jobs for Australians.

Tourism Research Australia suggests that, for every two formal students, one friend or relative visited Australia throughout the duration of their studies. These travellers contribute an estimated $314.7 million to the economy. It is clear that international students contribute enormously to Australia as a whole, but the effects are also clear when broken down to a state-by-state level. In Queensland, international students and their friends and visitors contribute approximately $1.7 billion in value added to the state’s economy.

Comparing this to the gross state product of $214 billion, international student flow-on effects account for 0.81 per cent of GSP. Of this, $1.2 billion is in the direct form of employee wages, with the remainder representing return to capital owners. International student activity in Queensland contributes close to 17,500 full-time equivalent workers, including almost 14,000 jobs in my home town of Brisbane alone. This equates to $970.4 million in direct wages, and $416.8 million as returns to capital owners, with the sector contributing $4.15 billion to Brisbane’s economy. When broken down to a local level, the contribution and importance of international students becomes particularly clear.

These amendments are a positive step towards supporting our international students. However, I do have grave concerns about the management of this sector under the Gillard Labor government. Changes to the Skilled Occupation List made in July last year saw international students across the country reach the end of their degrees without the certainty they thought they had throughout the duration of their course. Whilst the changes may have been necessary, the transitional arrangements for these students were inadequate, undermining international confidence in studying in Australia. This is not good for our international reputation and relationships. On top of this, the government’s attempt at reintroducing compulsory student amenities fees would see international students studying at our universities hit with yet another upfront cost for services that are optional.

The negative effects of this government’s mismanagement of the international student sector are clear. As reported in the Australian in May last year, the sector saw a 40 per cent decrease in overseas student applications in one month alone. At the time, Stephen Connelly of the International Education Association of Australia cautioned that, should this decline continue, the sector could lose up to 35,000 jobs by the end of 2011. These statistics have not improved. On 12 February, Dan Harrison of the Sydney Morning Herald reported that the number of international students choosing Australia for their degree had continued to fall, with student visa applications from outside Australia decreasing 32 per cent over the past six months of 2010, compared with 2009, which had already fallen 22 per cent compared to the same period in 2008. This drop must seriously concern universities, which have an increased reliance on the funds paid by international students given that the real value of government funding to universities has declined.

The cumulative effect of this Labor government’s mishandling of the implementation of these changes has caused uncertainty and decline. Indeed, last year Monash University, Australia’s largest, announced that it would lay off 300 staff to cover the budget shortfall caused by the decline in the number of international students at their institution. Estimates by Access Economics also show the impact of a five per cent increase or decrease in international student activity. The effects of a five per cent decrease are significant, reducing total value-added contributions by more than half a billion dollars. As seen through the Monash example, however, the most telling effect of a decline in international students is its effect on employment rates, with a five per cent decrease resulting in an employment drop of more than 6,000 full-time-equivalent workers.

Clearly, something needs to be done to regain Australia’s standing within the international education sector. Our universities and education institutions are world class, and I am sure that honourable members would agree that we are yet to find a country that offers greater safety, better natural attractions or, indeed, a better lifestyle than Australia. It is little wonder that Australia has been so competitive in this sector in the past. I have already noted the huge benefits that a thriving international education sector and international students bring to the economy. These are benefits we cannot afford to lose. This bill goes some way to providing international students with a reassurance that they are valued and that they do have a voice whilst they are here. History has shown that students who enjoy their education experience in Australia become friends for life.

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