Onshore visa switch flags looming downturn for universities

A skew towards onshore visa applicants is helping to prop up foreign enrolments in Australia’s universities, but observers say international higher education is headed for the sort of “correction” facing English language colleges.

Thirty-five per cent of primary higher education visas awarded last financial year went to people who had applied from within Australia, figures reveal. It was the highest share for onshore applicants in the past two decades, other than during the peak pandemic years of 2019-21 and the “perfect storm” years of 2009-13.

People applying from overseas are claiming a diminishing slice of primary higher education visas, as more applicants are knocked back. Former Department of Home Affairs official Mike Ferguson said the visa grant rate for this group had fallen from 92 per cent in 2024-25 to 81 per cent in 2025-26 and just 72 per cent between January and June this year.

Ferguson, now pro vice-chancellor of Charles Sturt University, said the grant rate across all nationalities other than China had averaged 62 per cent over the first six months of the year, down from 92 per cent during the equivalent period of 2025. The overall rate “doesn’t tell the full story and is certainly not reflective of what providers, students and agents are currently experiencing”, he noted on LinkedIn.

The assistant minister for international education, Julian Hill, said educators had damaged their own social licence with own goals like excessive concentrations of single nationalities. “It’s not acceptable when 60 or 70 per cent of students come from one country, and it’s not just China,” Hill told the PIE Live Asia Pacific conference. “It’s also a pretty dumb business strategy to put all your eggs in one basket, and it doesn’t meet the nation’s soft power objectives.”

Hill brushed off the impacts of Australia’s serial visa fee hikes, saying applications had continued to rise after recent increases. “The visa fee still represents a very small proportion of the overall cost of studying in Australia,” he said. “Exchange rates and other pressures have a far, far more significant impact on the overall cost structure.”

Former migration agent and college founder Jan Bejcek said such observations papered over the challenges facing international education providers. “The view from ground level, sector by sector and month by month, tells a harder story that has not reached higher education’s numbers yet,” he posted.

Bejcek, who provides compliance software for agents and colleges, said the higher education “topline” would “hold its shape” for another year or two, “propped up” by onshore applicants. But the “leading indicators” lay “one and two enrolment cycles upstream”, in declining study commencements and visa grants for vocational and English language students.

Steve Nerlich, former director of international analysis with the Department of Education, said the student visa processing system seemed geared towards driving down new arrivals to accommodate growing demand from applicants already in Australia. This most likely reflected logistics rather than official policy preference for onshore applicants.

Onshore visa submissions are more likely to be approved because the applicants have already met the criteria for entry into Australia, Nerlich said. And for a government intent on curbing net overseas migration, it is easier to stop people arriving than to get them to leave.

Nerlich said that while international student numbers were declining, there had been “huge growth” in the numbers of temporary graduate visa holders and people applying for student visas while in Australia on bridging visas. “Student behaviours have changed post-Covid,” he said. “There’s a lot more interest in remaining in Australia rather than just going home when they finish studying.”

Under a new directive issued by home affairs minister Tony Burke, onshore applications are given processing priority for 17 subclasses of skilled worker visas. Burke was expected to announce a raft of additional changes during an address to the National Press Club on 6 August, when he was scheduled to discuss “the work of managing the migration programme”.

In an illustration of the political problems migration is causing for the government, which trailed the populist One Nation party in a recent opinion poll, Burke cancelled the Press Club address at short notice. The ABC reported that his appearance had been postponed following a cabinet meeting because details of the “contentious” changes had not been finalised.

john.ross@timeshighereducation.com