Visa curb will cut revenue, warns MIT

The Manukau Institute of Technology has warned that proposals to tighten poststudy work visas for overseas students could threaten its financial viability.

Chief executive Gus Gilmore has told the Government that the proposed changes would halve the institute’s fulltime-equivalent foreign students from 1000 to 500, cost 64 tutoring jobs and slash its revenue by $10 million a year, or 10 per cent of its $103m total revenue.

This comes on the top of declining domestic enrolments which pushed the institute into a $7m loss last year.

“The projected annual $10m reduction in revenue could lead to financial viability issues requiring Government intervention and cash injection,” Gilmore said in a submission on the changes.

Waikato Institute of Technology (Wintec) says in another submission its overseas student revenue would drop by $4.5m a year or 30 per cent.

Western Institute of Technology at Taranaki says it could lose up to 75 per cent of its overseas students and $1.5m in revenue.

The backlash appears to have surprised the Government, as Labour’s 2017 election policy said its proposed crackdown on student work rights would only affect “low-level courses at private training establishments”.

“We do not expect them to adversely impact universities, polytechnics or schools,” the policy said.

Labour promised to scrap work rights on student visas, and poststudy work visas without a job offer, for most courses below degree level. It said it would close a “loophole” that let unskilled migrants gain residency via low-level courses, and cut net migration by 15,000-22,000 a year.

Last month Immigration Minister Iain Lees-Galloway published detailed proposals to abolish the current two-year post-study work visa tied to a particular employer, keeping only a one-year open work visa for students who had studied for at least two years in sub-degree courses and a three-year open work visa for graduates at degree level and above.

Submissions closed on June 29 and the proposals are expected to go to a Cabinet committee this week.

The Government has not yet made any changes to students’ right to work up to 20 hours a week while on a student visa, but it is due to consider that issue in October.

Lees-Galloway said last month that the post-study work visa changes would affect 12,000-16,000 students and cut spending by overseas students by $260m a year.

However, a May 16 briefing by Education NZ to Education Minister Chris Hipkins, obtained by the National Party under the Official Information Act, estimated a loss of 17,425 students, worth $486m a year.

It said private training establishments would lose 12,465 students worth $320m, and polytechnics lose 4960 students worth $166m a year.

Gilmore said the biggest impact for Manukau would be on students in graduate diplomas at Level 7 of the qualification framework, where students with degrees from home countries were treated as sub-degree students here.