AUSTRALIA: Worrying end to a troubling year

It has not been the best of years for Australia's universities. Not exactly annus horribilis but pretty close, especially as 2010 nears its end and especially for the nation's biggest university, Monash.

With an aim of becoming a top 100 global institution (in more ways than one), Monash has six campuses in Victoria and three overseas offshoots - full campuses in South Africa and Malaysia and a centre in Italy - so the university is overflowing with students and staff.

Well it was. But then the overseas student market suddenly went sour and now Monash is running short of foreign fee-payers and has had to offload hundreds of staff while trying to attract more local students to fill the empty places.

In an email to academic and general staff last week, Vice-chancellor Professor Ed Byrne warned that international education was a major source of funding, comprising 20% or AUD300 million (US$298 million) of Monash's total annual revenue, but that this source was in steep decline.

Byrne said that as a result, 359 full-time equivalent staff - more than 400 individuals - had taken redundancy packages and large-scale restructuring was underway. He had earlier noted that spending next year would have to be cut by $45 million and that his top echelon was not exempt with three of his pro vice-chancellors losing their jobs.

Monash, of course, is not unique in facing a grim new year with further savage falls expected in Australia's two biggest markets for overseas students: China and India. The far smaller and rather less prestigious Central Queensland University (or CQUniversity Australia as it prefers to be known) is reportedly facing a $20 million drop in revenue next year and a further $16 million loss in 2012.

CQU has the highest proportion of overseas students of any in Australia and relies heavily on their fees to maintain its 'shopfront' campuses in Brisbane, the Gold Coast, Sydney and Melbourne. With some 50% of its students now from overseas, CQU is among the most vulnerable to market downturns and expects a 25% fall in commencing student numbers in 2011 and a similar drop the following year.

Yet this is not the first time the multi-campus institution has experienced such losses. More than three years ago, it faced a similar sudden and catastrophic fall in overseas enrolments, forcing it to slash more than 200 administrative jobs.

Most universities, certainly the big metropolitan institutions, are also facing substantial declines in overseas student enrolments for at least the next two years. The reasons vary but government-imposed tougher regulations on gaining permanent residency have certainly affected numbers from India and China.

The increasing value of the Australian dollar against the Greenback and the consequent higher cost of tuition are clearly also influential: why would a Chinese or an Indian student opt to study in Australia when they can enrol in an even mid-level US university for the same or lower price?

Then there is the damage caused to Australia's reputation by attacks on Indian students in Melbourne and Sydney, along with the collapse of dozens of crooked vocational colleges that only served as backdoor means of providing students with permanent residency visas. That door having closed means a key drawcard for coming to Australia has been eliminated.

Even universities that have so far not suffered dramatic falls in overseas numbers this year are worried what the future holds. A key pipeline into university is the English-language colleges; in many cases they are run by the universities themselves, but their enrolments fell by more than 20% this year with further declines likely.

Monash's own English-language preparatory college suffered a 30% fall in enrolments and this may be the reason why Monash, along with other universities, are spending vast sums advertising their wares to this year's crop of school-leavers. They need to fill the places created by the disappearing foreign students and to do that they need to recruit more locals.

But a local student does not bring in nearly as much as a full-fee paying foreigner; in fact the latter's contribution to a university's coffers can be two and three times higher than for a domestic student. For example, an undergraduate international student taking a business course at Monash must pay more than $30,000 a year in tuition whereas the university receives $20,000 less from a local doing the same course.

To get the same return, Monash would have to enrol three domestic students for every foreigner. That or cut its own costs, including staff numbers, which is what is now happening on its campuses and will also be taking place on other campuses elsewhere across Australia.

geoff.maslen@uw-news.com

Comment:
That happens when education becomes a simple business, I would suspect from a country that sells or exports university diplomas. On the other hand, the lack of government funding for research and education is sloppiness. Education and research can not be left to market forces.

Leonardo Vela