Australian Universities Fear a Dangerous Dependence on foreign students

[Harold F. Schiffman]

http://chronicle.com/weekly/v54/i48/48a01501.htm
>>From the issue dated August 8, 2008


Australian Universities Fear a Dangerous Dependence
As the foreign-student market slows, higher-education officials grow
concerned about revenue and quality

By LUKE SLATTERY

Sydney, Australia

Australia has been stunningly successful in its ability to recruit foreign
students. An estimated 250,000 of them study at Australia's 39
universities and their offshore programs. That's an estimated 6 percent of
the world market.

But even as Australia has gained admiration overseas for its recruiting
successes, university administrators and professors here have become
increasingly worried that their higher-education system has developed a
dangerous dependence on foreign students.

About 25 percent of the public system's budget comes from foreign-student
tuition. That revenue proved to be a blessing for much of the 1990s and
the early 2000s as federal support declined.

But enrollment numbers have dropped from their double-digit increases.
Growth during the 2006-7 academic year was 6.6 percent. As a result,
several universities have found themselves in a financial crunch.

One of the first warning signs appeared in 2004, when the Royal Melbourne
Institute of Technology had to take out a loan to meet a shortfall of
$25-million (U.S.). Among other troubles, it had overestimated the number
of foreign students who would enroll.

Last year a $5-million hole appeared in the University of Melbourne's
arts-department budget, partly for the same reason.

At Central Queensland University, where nearly half of the 25,000 students
are from overseas, falling international enrollments forced administrators
to dismiss 200 faculty and staff members last June.

John Hay, who retired this year after 12 years as vice chancellor of the
University of Queensland, says many of the less competitive universities
have reduced their entrance standards in order to raise overseas
enrollments, appointed part-time staff to teach those students, and made
do with inadequate infrastructure.

"In short," he says, "they are being taught in an often inappropriate
context for higher education, in numbers that are too large. It sends a
bad message."

John Rickard, vice chancellor of Central Queensland, rejects any
suggestion that academic standards are lower on his campuses in Sydney,
Melbourne, Brisbane, and the Gold Coast, which serve primarily
international students.

In an e-mail message, he said the library facilities, for example, were
"among the top 25 percent for quality, customer satisfaction, services,
facilities, and staff" in a 2007 survey.

"We consider ourselves an educator with high standards," he said, "and
hold a core belief that there should be no obstacleseconomic, pedagogic,
administrative, or politicalto students accessing to higher education."

A Once-Rosy Picture

Between 1996 and 2006, the number of international students enrolled in
Australian universities climbed 371 percent. (By comparison, the number of
Australian students rose 26 percent.) Today education is the country's
third-biggest export, raking in $11.7-billion last year.

But Australian universities are hardly flush with cash. During roughly the
same period that foreign enrollments grew, federal support for higher
education fell sharply. In 2006 it made up 41 percent of the
public-university system's budget, down from 57 percent in 1996.

The government's strategy was simple: Require universities to depend more
on tuition for income and less on government support. The widespread
importing of foreign students was in large part the product of dire
financial need.

Frank Larkins, the deputy vice chancellor responsible for international
students at the University of Melbourne, says some highly regarded
research institutions now use international-student revenue to subsidize
other operations. Melbourne, he says, depends on the $250-million it earns
each year from foreign students, who make up 27 percent of the student
body, to pay for new facilities and for research scholarships and
professorial appointments.

"Whereas in the early 90s it was a bit of a luxury to have some
international funds that were a bit discretionary, that's no longer the
case," he says. "It's now a core part of the budget of every Australian
university. Without it we might not be able to hire world-class staff in a
global market. It's a big business."

Simon Marginson, a professor of higher education at Melbourne, says this
financial dependence distorts a university's mission and threatens
academic quality. High enrollments, he says, can be maintained only by
admitting some students of questionable quality and then pushing them
through to graduation: "The Australian system is in danger of just
rubber-stamping degrees."

A study released last year has been used to back up that claim. Bob
Birrell, director of the Centre for Population and Urban Research at
Monash University, found that one-third of foreign students who obtained
permanent residence visas after graduation in the 2005-6 academic year
could not demonstrate that they were competent in English on standard
Immigration Department tests.

Whether or not academic standards are declining at Australia's
universities, one thing is clear: The federal government spends less on
higher education than most other developed nations do.

A report released last fall by the Organisation for Economic Cooperation
and Development, a group of industrialized countries that share economic
data, said Australia spent 4.3 percent of its gross domestic product on
all levels of public education, compared with an average of 5 percent
among similar democratic nations. Australia was the only one of the
group's 30 member nations to reduce public spending on higher education.

Stephan Vincent Lancrin, an international education analyst with the OECD,
says he is concerned that Australia has adopted a mercantile approach to
international education.

"What struck me the last time I visited Australia is how the academic
mentality has changed and how the academic sector views itself as an
industry," he recalls. "This is something that is still very odd in most
other OECD countries, including the United States. And it's something that
would probably have been unthinkable 15 years ago."

'A Worrying Perception'

Many academics demand that the Labor government of Kevin Rudd, who was
sworn in as prime minister in December, correct the financial imbalance by
putting more money into higher education. Mr. Rudd promised more funds as
part of an "education revolution" when he was elected, in November, and in
May his government announced that it would nearly double the
higher-education infrastructure endowment, to about $10.5-billion.

"This is a first step in indicating that the government is serious about
including higher education in its education revolution," said Glenn
Withers, chief executive of the top higher-education association,
Universities Australia, in a written statement. But he urged the
government to meet the immediate need for more financing for each student
to maintain the quality of teaching.

Eight of the country's major research universities recently submitted a
report to the federal government warning that Australia's image is taking
a beating in India, and that the government should increase scholarships
for graduate students and researchers from that country.

"A worrying perception of Australian education in India is as a provider
of cheap rather than high-quality courses," wrote the group, which
includes Australian National University, the country's top research
institution in the international rankings compiled by Shanghai Jiao Tong
University. "This perception is compounded by the large number of Indian
students who clearly chose Australia as a study destination in order to
gain permanent residency. Three-quarters of Indian students who complete
university courses in Australia apply and receive permanent residency
visas."

Australian universities are also taking measures to make sure they are not
overly dependent on any one particular foreign market.

While most foreign students here come from Asian countries such as China,
Indonesia, and Malaysia, university recruiters are branching out into
other parts of the world. Institutions have also been more aggressive in
tapping into some of those traditional Asian markets.

For many universities here, the challenge has become twofold. They want to
reduce their financial dependence of foreign students, for sure. But they
also want to attract better students in order to keep their economy
competitive.

"We are not attracting the best and brightest," says Mr. Marginson, the
Melbourne professor. "Nor is that the image we seek to project. In the
global knowledge economy, talent is highly mobile, and other nations now
place a growing emphasis on policies designed to attract and hold foreign
researchers."

Despite his concerns, Mr. Lancrin, of the OECD, thinks Australian
universities will come out of this period of tumult intact, in part
because of their past successes.

Australia, he says, realizes the importance of diversifying its foreign
student body. And while "it has sometimes been too optimistic about the
demand," he adds, "it is really one of the countries with the most
experience and the most advanced on that learning curve."

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Section: International
Volume 54, Issue 48, Page A15