(Aug 27): Australia will limit the number of foreign students to 270,000 in 2025 as part of a migration crackdown.

Under the policy, the government will cap new international students at 145,000 for universities and 95,000 for the skills training sector, Education Minister Jason Clare said on Tuesday. For other universities and non-university providers, commencements will be around 30,000. Almost 600,000 student visas were granted in fiscal 2023.

Universities have repeatedly warned that any moves to limit foreign students could damage the lucrative tertiary education industry.

“This is an important part of our economy, no doubt about it. That hasn’t changed,” Clare told reporters in Sydney after the announcement. “But as students have come back, it has put pressure on the reputation of the sector.”

Overall, there will be about 15% more students allowed for universities and 20% fewer for vocational colleges in 2025, Clare said. The government was writing to individual universities to inform them of their caps on Tuesday.

“To create the impression that this is somehow tearing down international education is absolutely and fundamentally wrong,” Clare said. “It is about making sure that we set it up in a sustainable way for the future. We want students to come and study here.”

The government has been consulting for months over plans to impose limits on foreign students, part of a broader push to crack down on high post-Covid migration numbers. The surge in migration has coincided with rising voter concerns about a housing squeeze that sent rents soaring, proving politically damaging for the centre-left Labor government.

Support for migration in Australia has fallen to its lowest level in five years, according to a poll released by Essential on Tuesday, with 42% of those surveyed saying it had a negative effect on the country.

International students contributed A$48 billion (US$32.5 billion or RM141.80 billion) to the Australian economy in 2023, making it the country’s top services export. Ahead of the announcement, the Property Council of Australia’s Student Accommodation Council said the government should focus on broader housing supply issues rather than targeting international students.

“The government needs to take a long term look at the structural supply issues in our country. We can’t blame international students for a problem we created,” executive director Torie Brown said.

Universities have similarly warned that the government is risking a key industry in an effort to ease concerns over cost pressures that aren’t directly related.

Australia chief executive officer Luke Sheehy told a Senate committee in early August that it could lead to 14,000 job losses in the sector and cost the economy as much as A$4.3 billion.

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