One of Australia’s most established private colleges has been placed under external administration, making it potentially the biggest institutional victim of the federal government’s international education crackdown.
International House (IH), a 27-year-old college registered to teach about 10,000 overseas students, is under voluntary administration despite avoiding enrolment caps that would have limited it to fewer than 1,000 vocational and higher education commencements next year.
The eight-campus college has weathered challenges which have decimated international student numbers, including Covid-19, the Asian financial crisis of the late 1990s and a major downturn 15 years ago.
However, the multifaceted nature of this year’s crackdown has left many colleges reeling. While the proposed enrolment caps are off the agenda for now, the sector is struggling with visa processing changes that have caused long delays and soaring rejection rates, while the non-refundable visa application fee more than doubled to A$1,600 (£820) in July.
Chief executive Tim Eckenfels said these measures, combined with the dampening influence of the caps proposal, had all contributed to his problems. Visa rejections had more than tripled to 21 per cent, forcing the college to refund more than A$12 million in tuition fees paid in advance by students subsequently refused entry to Australia.
He said the visa fee hike had slowed applications from July. Monthly fee income had crashed from between A$4 million and A$5 million to around A$2 million. A Melbourne-based creditor had called in the administrators after being informed in advance that a scheduled payment would be delayed.
Mr Eckenfels said the college hoped to continue teaching its students and emerge from voluntary administration. “We are also in discussions for other providers to take our students. We are…trying to work through this time with our creditors and a possible investor or acquisition.”
The college has already made about 25 permanent staff redundant and cut its contract teacher numbers by 20 per cent, he said.
IH’s fortunes have changed dramatically since September last year. With its English language and training student numbers rebounding from the pandemic, the college branched into higher education by acquiring the recently registered PBL Education for A$7 million.
Three months later, the visa processing chaos began. Mr Eckenfels told a Senate committee hearing in October that PBL had rejected 70 per cent of its applicants this year “to protect our risk rating”. Immigration officials had rejected half the surviving applicants. “We have 30 students…at a time when we should have more than 100,” he told senators.
Consultant and former regulator Claire Field said IH was a highly regarded institution that had prevailed for more than two decades in sometimes very difficult circumstances. “This is not the profile of the dodgy institution that the government says it wants to boot out of the industry,” she said.
“The massive application fee is a major turnoff particularly for students looking to do short, English language courses and people from low-income countries more generally – especially if they stand a one in two chance of doing their dough.”
IH general manager Mark Raven, a former chief executive of language teaching quality assurance agency NEAS, told the October hearing that the college was “being forced towards insolvency”.
He said a A$1,600 visa fee for a 16- to 24-week English course was “prohibitive, particularly with refusal rates which are so high. All we’re looking for is some compassion in this discussion.”
