How bad is the international student English language problem?

The English language abilities of international students keep coming up as an issue. Despite reassurances from the regulator and universities, there is little publicly-available evidence to support a conclusion that the language issues are too infrequent or not serious enough to be a major concern.

Although we should always be careful with statistics on self-assessed abilities, they can provide a rough guide. If someone says that they do not speak English very well chances are that they will struggle in an English-speaking university.

One source of data on self-assessed English is the 2016 Census. The Census does not directly identify people on student visas, but I have used a number of filters – enrolled full-time in university, non-citizen, and arrived in Australia 2014-2016 – to identify likely international students. I also removed people who are monolingual English speakers. It’s likely that the data still includes some visitors to Australia and domestic students, such as those on humanitarian visas, but it should be dominated by international students.

As the chart below shows, the vast majority of likely international students say that they speak English well or very well. However, 9 per cent say that they do not speak English well.

English language overall

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Migration has outpaced demand driven funding as a source of additional graduates

As the latest OECD Education at a Glance publication confirms, Australia is a high tertiary education attainment country. But large-scale migration makes it hard to interpret Australian figures – what is the result of policies aimed at educating Australian citizens, and what is due to our commercial international education industry and skills-based migration program?

Although demand driven funding increased the annual number of people completing bachelor degrees, on my calculations using the ABS Education and Work survey additional citizen graduates of Australian universities account for slightly less than half of the increase in graduate numbers since 2013 — 406,000 additional Australian or New Zealand citizen graduates of Australian universities and 421,000 extra graduates who hold degrees from overseas universities or are non-citizen holders of Australian university degrees.

20-64 overseas and domestics

The chart below attempts to break the numbers down a bit further, although the categories are not straightforward.

Education and Work separately identifies people on a student visa, which it puts at 142,000 in 2018 (80 per cent with overseas degrees). I have deducted these from the other non-citizen categories. As postgraduate international enrolments have been growing more quickly than undergraduate in recent times, I expect this category to grow in future years. types of overseas grad

In Education and Work, the ABS continues its irritating standard practice of not identifying permanent residents, who are entitled to a Commonwealth supported place and to remain indefinitely in Australia. There were 36,000 domestic students with PR in 2017. This means the ‘non-citizen with an Australian degree’ category is a mix of them (after they graduate) and former international students on temporary or permanent visas. With increasing numbers of completing international students getting 485 visas, I expect that this will be a growing category.

What I find most interesting in this data is the very large number of people with overseas degrees – more than a million in total. About 45 per cent have have taken out citizenship. Most of them would be the product of Australia’s skilled migration program, although there were also 58,000 New Zealand citizens, who can come to Australia without going through the usual visa system, with an overseas degree.

On right-hand side of the second chart I have a column ‘migrant citizen with an Australian degree’, representing just over 700,000 people, that in the first chart appears in the ‘domestic’ time series. Most of them, I think, would have been domestic students (just under half arrived in 1996 or earlier), but some largish proportion would have been people who arrived as international students and subsequently became citizens.

In 2018, 68 per cent of degree holders in Australia were Australian or New Zealand citizens with degrees from Australian universities. But because we cannot identify the former international students in this group, it is quite likely that more than a third of all degree holders in Australia acquired their qualification with no assistance from Australian higher education policy.

 

The case for redefining low socioeconomic status in higher education

(This post also appears on the Grattan Institute blog.)

Since the early 1990s, higher education statistics have defined someone as of low socio-economic status if they are from a region classified in the lowest 25 per cent in Australia according to the ABS Index of Education and Occupation.

Universities are rewarded for enrolling students from these areas. A participation fund of about $135 million is distributed between universities according to their share of low SES students. A university’s success in the new performance-funding scheme will depend in part on it enrolling low-SES students.

The low-SES definition has been criticised over the years, usually because it often misclassifies individuals. High-SES people live in low-SES areas, and vice versa. But we need a balance between precision and practicalities. To recruit additional low-SES students, universities need to first identify them. Geographic areas are easier to find than individuals with particular family characteristics.

Although geographic SES measures should be retained, the lowest 25 per cent definition needs reconsidering. As the chart below shows, in 2016 higher education participation rates in the lowest quartile were not clearly distinct from the second quartile. Generally, the weighted average participation/attainment rates at the ABS SA2 geographic level cluster at around 25 per cent for people aged 18-23 across the lowest 50 per cent of areas by the Index of Education and Occupation. An SA2 is roughly the size of a postcode.*

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Little sign in Australia of conservatives losing confidence in universities

In the United States, the general public has an increasingly negative view of universities. In 2019, 38 per cent of respondents to a Pew Research Center survey said that universities had a negative effect on the way things are going in the country, up from 26 per cent in 2012.

In Australia, there is no directly equivalent question but successive questions on confidence in universities find that around three-quarters of respondents have a ‘great deal’ or ‘quite a lot’ of confidence in universities. The numbers are down slightly on their peak, but above where they were at the start of the century. With other important institutions scoring poorly on this question, university ratings are high and resilient.

confidence in universities

In the US, the decline is driven by Republican voters. They share with Democrats concerns about tuition costs and employment outcomes, and also believe that students are protected too much from views they might disagree with and that academics bring their political beliefs into the classroom. There are some parallel critiques in Australia, with worries about free speech and  left-wing bias in some courses.

So far, however, these concerns are not significantly influencing how Coalition voters perceive universities. As the chart below shows, about three-quarters of them have confidence in universities, compared to 80 per cent or more for supporters of left-wing parties. It is people who don’t support any party or prefer a minor party who have the lowest confidence in universities.

Partisan confidence in universities

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Is HELP doubtful debt likely to increase?

In February last year, when introducing legislation to change HELP repayment thresholds and rates, along with other HELP reforms, the government said that:

The fiscal challenge for the government is that HELP repayments have not kept pace with HELP lending growth. From 2010-11 to 2016-17, the level of new debt not expected to be repaid increased from 16 per cent to 25 per cent.

But unfortunately there is a disconnect between the stated purpose of the legislation and its likely effects. The thresholds and rate changes are unlikely to reduce doubtful debt , and indeed may increase it. Using  ATO tax data,  at the Grattan blog Will Mackey estimates that the new HELP repayment thresholds will produce slightly lower total annual student debt repayment than the previous thresholds.

The reason is that although some low and high income earners will repay more each year, most of the more numerous middle-income earners will repay less, producing a total repayment estimate of about $50 million a year less than if the previous thresholds and rates had been retained.

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Will the number of Commonwealth supported student places fall?

A couple of opinion pieces about university performance funding last week suggested that the government’s policy is aimed at increasing student places with population growth. That may be the impression the government is trying to give, but their policy provides a financial incentive to decrease the number of student places.

The government’s promise is to increase nominal funding for bachelor-degree places in line with increases in the population aged 18-64, for those universities that meet performance targets. But because percentage population increases are likely to be below inflation,  total Commonwealth Grant Scheme funding will decrease in real terms each year, even if universities get 100 per cent of their performance funding.

Although maximum CGS payments will probably increase at less than the rate of inflation the underlying Commonwealth contributions are still being indexed to the CPI. As noted last week, the demand driven funding calculation is still going on as well, so that universities receive the lesser of their demand driven or maximum grant amount. The practical effect of this is that universities can decrease the number of Commonwealth supported places each year and still get their maximum CGS funding amount.

The chart below illustrates the logic, using nursing as an example. Under the Wellings review recommendations, universities are pretty-much guaranteed 60 per cent of their maximum performance funding. So on the left-hand side of the chart below I have indexed the maximum funding amount to that and divided it by the indexed Commonwealth contribution. Next year a university could offer 4 per cent fewer nursing places than in 2017 and still get its maximum funding amount. 100 per cent performance funding does not make much difference. Read More »

The legal basis of performance funding

In December 2017, the Commonwealth froze maximum Commonwealth Grant scheme funding for bachelor-degree places for the next two years. In subsequent years, the maximum payment will increase in line with growth in the 18-64 year old population, conditional on universities meeting performance indicators.

Just before the 2017 announcement, I outlined its legal basis. It used university funding agreements to set the maximum amount, with the method chosen because it did not need parliamentary approval.

At least initially, performance funding will be administered via the funding agreements, which include a standard statement that should the university meet its performance targets it will be advised of a new maximum funding amount.

A drawback of this method of allocating performance funding is that there is no performance fund. The underlying demand driven funding system is still operating, and under section 33-5(5) of the Higher Education Support Act 2003 universities receive the lesser of their demand driven funding amount (bachelor-degree full-time equivalent student places times the relevant Commonwealth contribution) and their maximum funding amount.

All the Commonwealth is doing is promising universities it will pay a little more of what they would have been entitled to anyway under demand driven funding. Read More »