Regional universities’ city centre campuses avoid clampdown

Australia’s regional universities have dodged a threat to their financial resilience, after Canberra resisted pressure to review the “desirability” of their central city campuses.

The federal government has shrugged off a recommendation to examine whether universities should be allowed to “chase revenue” by opening campuses in the centres of major cities and subcontracting the teaching to private institutions.

The recommendation from a parliamentary committee reflected reservations about the quality of learning in high-rise city campuses where the “overwhelming majority” of students are foreigners.

The committee was also worried that downtown living costs were forcing students to compromise their safety in long after-hours commutes to cheap outer-suburban accommodation.

In a belated response to the committee, which first proposed the plan in 2023, the government “noted” the recommendation but failed to endorse it, saying that third-party teaching arrangements were overseen by higher education regulator Teqsa. The government said it was committed to supporting regional universities financially, and had introduced needs-based funding for educational delivery at non-metropolitan campuses.

The response could prove a reprieve for country universities that rely on overseas students to help cover the cost of doing business in less populated areas. Consultant Claire Field said it was good that the government had recognised regional universities’ “financial challenges” and their reliance on capital city campuses to attract international students.

“If Australia wants more diversity in our international student population and thriving regional universities, we need more funding for regional universities and more encouragement for students to study outside capital cities.”

In 2024, the latest year for which full published accounts are available, the 10 regionally based universities in Australia’s eastern mainland states collectively attracted almost A$1.1 billion (£580 million) – more than 19 per cent of their overall revenue – in income from overseas students.

Nevertheless, six earned less in international tuition fees than they had before the coronavirus pandemic, and five ended the year in deficit.

Their international earnings come primarily from the 17 campuses they collectively operate in Adelaide, Brisbane, Melbourne, Perth and Sydney. Few foreigners want to study in rural Australia, and many need access to English language programmes in the cities.

Capital city campuses are also crucial to regional universities’ broader internationalisation ambitions, allowing administrators to host delegations from overseas, and boosting the international enrolment metrics used to calculate global rankings.

But city campuses can also jeopardise regional institutions’ reputations and attract regulatory repercussions. In 2019, Teqsa slapped conditions on the registrations of Charles Sturt University (CSU) and the University of Southern Queensland, citing concerns over courses taught by “other parties”.

Central Queensland University (CQU) found itself in regulatory strife two decades ago when the then Australian Universities Quality Agency criticised its partnership with Global Campus Management, which ran four city campuses catering exclusively to international students. CQU bought out and eventually wound down the joint venture operation with its partner, in moves that cost it many millions of dollars.

Australian institutions are not alone in drawing this sort of attention. Northern English and Scottish universities have attracted harsh criticism over their central London campuses, which some politicians regard as fronts for unwanted immigration, a claim fiercely denied by those involved. 

Some Australian institutions have associated with new partner providers in a bid to improve the standing of their city operations. CSU shuttered three city campuses and ended its 26-year association with Study Group Australia before reopening in Sydney and Melbourne in partnership with Navitas. The universities of the Sunshine Coast and Tasmania have opened outposts in Adelaide, Melbourne and Sydney in association with private provider ECA.

Although the federal government appears unlikely to put a stop to such arrangements, regional universities are reeling from the Department of Home Affairs’ refusal to grant visas to thousands of students in their key South Asian source countries.

In February, Australian officials approved just 62 per cent of higher education visa applications from Sri Lanka, 60 per cent from India, 49 per cent from Bangladesh and 35 per cent from Nepal. Insiders are struggling to understand why so many would-be students are being rejected, saying that neither the rules nor the quality of visa applications have changed.

CSU said that about half its enrolled students had been denied visas or not received them in time for semester one. “We want to work in partnership with government,” said pro vice-chancellor Mike Ferguson. “Integrity is important, but we need greater clarity in terms of what Home Affairs is looking for when it’s making visa decisions.”

A source from another regional university said grant rates had bounced back in recent weeks. International Education Association of Australia chief executive Phil Honeywood said Home Affairs had reported an improvement in the “quality of applications”.

john.ross@timeshighereducation.com