London Metropolitan University loses its sponsor status

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Created on Thursday, 30 August 2012 17:27

Written by Editorial staff

Australian universities will be paying close attention to a landmark decision in the UK, which student groups claim could threaten an industry worth $18 billion a year. 

London Metropolitan University (LMU) has lost it ‘highly-trusted sponsor’ status, meaning that it can’t take international students with immigration visas during a peak recruitment period. This could cost the university up to $15.2 million.

The streamlined visa processing arrangements involved a student monitoring system and as a result of losing that status, it highlights a potential risk for Australian institutions who heavily rely on lucrative overseas business.

Posting a statement on its website, the National Union of Students has said it has contacted the prime minister, David Cameron, to “express anger at the way that decisions have been made in recent weeks and to reiterate the potentially catastrophic effects on higher education as a £12.5 billion ($18 billion) per year export industry for the UK".

In Australia, while it’s not compulsory to sign up to this system of streamlining applications, most universities have done so in order to ensure the application process remains competitive.

Queensland University of Technology deputy vice-chancellor Scott Sheppard has told News Limited that being expelled from this system "would have a very clear impact on their position in the international market”.

“In a very competitive marketplace, if your processing times went out by eight or ten weeks, students would rightfully opt for another provider,” said deputy vice-chancellor Sheppard.

Australian universities are already struggling to remain competitive due to the high Australian dollar and well-documented attacks on foreign students in 2009.

In an increasingly globalised marketplace for higher education, universities have to work harder to attract business from foreign students, who tend to pay higher fees.

Deloitte Access Economics has released a report showing that this loss of revenue for universities could have a flow-on effect to the wider economy. A drop in foreign students coming to Australia could wipe out 50,000 jobs and over $6 billion from GDP by 2015.