V-c says flow of overseas cash could soon dry up

January 29, 2009

Australian and UK universities could face a major funding deficit as an increasingly competitive global market in higher education drives down income from international students.

That is the view of Glyn Davis, vice-chancellor of the University of Melbourne, who used a visit to London last week to warn of the dangers of both countries continuing to rely on income from international students to fund higher education.

"Competitive pressure makes it all the more important that policymakers in both countries solve the underlying domestic policy problems behind the over-reliance on international student markets," Professor Davis said.

Speaking at the Menzies Centre at King's College London, Professor Davis said that since the late 1980s Australia's universities had seized the opportunities offered by its being an English-speaking nation near Asian countries unable to meet internal demand for higher education.

"This entrepreneurial effort averted the financial crisis that would have otherwise accompanied declining public funding. But now as those Asian markets mature and turn into competitors, we must start to think again about how Australian higher education will be financed in the long term," he said.

The same concerns applied to the UK sector, he added.

Professor Davis said that a survey of international students studying in Australia found that most felt that there were similar courses of higher quality available in the UK and the US.

"We lack institutions of the global status of Oxford or Cambridge. It is a warning that though we are geographically closer to the main ... markets (and have) lower overall costs, strategic vulnerabilities arise from gaps in what we can offer."

hannah.fearn@tsleducation.com.

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