International education has enjoyed explosive growth in Australia in recent years and the revenue has become a pillar of many university budgets, subsidising domestic teaching, research and university infrastructure.
With major blows to Chinese student numbers since the outbreak of COVID-19, peak body Universities Australia has warned the sector faces losses of between $3 billion and $4.6 billion and government support is critical to protect institutions’ viability.
Professor Schmidt said the boom in international education had been pushed by Labor and Coalition governments under an “unwritten pact” and it was therefore a shared responsibility.
“We became more exposed to the international student market as federal governments over the last 10 years withdrew funding from the university sector,” he said, adding that the sector might now be paying for its reliance on international education.
He said “hard decisions” would have to be made by universities during the crisis but they should be part of a comprehensive strategy to make universities “fit for purpose” in 2022 and beyond.
“We can just plug a haemorrhage here and plug a haemorrhage there and then we’ll end up with something, but it surely won’t be what is in the national interest,” he said.
The future strength of international education would depend on other countries’ recoveries from the crisis, the easing of restrictions on travel and perceptions of how Australia has treated students, Professor Schmidt warned.
Acknowledging “downsides” that had to be managed better, he said international education had been an economic and cultural boon for Australia and the risk was the nation’s market share would “bleed” to others countries like the United States, Britain and Canada.
“They are the places that our students will go in the future. And if we’re seen as out of step with them, then why wouldn’t you as a student go there in the future?”
Universities and other international education providers have been calling for greater government support for students who have lost their jobs and face barriers to return home.
Prime Minister Scott Morrison last week said it was “time to go home” for students that couldn’t support themselves. Education Minister Dan Tehan subsequently said the government was working on “innovative” ways to support them.
Professor Schmidt said the ANU had a “big exposure but not as big as we could have had” because the university moved two years ago to rebalance and curb reliance on international students.
He said it was still uncertain what the exact financial impact of the crisis on ANU would be, pending confirmation of enrolment levels in first semester and second semester and even 2021.
Engagement of students has so far remained high, with “almost all” of domestic students staying connected and “well over 80 per cent” of the international cohort. ANU pushed back its first semester census date to allow students more flexibility.
Professor Schmidt said the revenue blow could be anything from “relatively minor” to 30 per cent of the university’s budget, which would necessitate “major” cost cutting.
He warned ANU already had the smallest budget of any of the world’s top 50 universities and any major reductions meant “we won’t be able to be the national university we are meant to be”.
Sign up to our Coronavirus Update newsletter
Get our Coronavirus Update newsletter for the day’s crucial developments at a glance, the numbers you need to know and what our readers are saying. Sign up to The Sydney Morning Herald’s newsletter here and The Age’s here.
Fergus Hunter is an education and communications reporter for The Sydney Morning Herald and The Age.