¡°Dipping into the pockets¡± of English universities via a levy on international student fees is ¡°finger in the air¡± policymaking that will further harm institutions¡¯ financial sustainability, critics say, especially when combined with other incoming visa restrictions.

The higher education sector was left reeling by?a proposal that the UK government takes a cut of overseas income, a surprise addition to the keenly awaited White Paper on immigration reform.

suggest the proposed levy could be as much as 6 per cent, although this was described as ¡°illustrative¡±. 51³Ô¹Ï Office modelling?predicted this would reduce applications by 7,000 per year in the long run ¨C and 14,000 in the shorter term ¨C if institutions passed it on in the form of higher fees.

Many felt that the paper¡¯s other headline policy of reducing the graduate visa by six months was ¡°not as bad as it could have been¡±, leaving the levy ¨C which mirrors a move that was considered and then rejected in Australia ¨C causing the most concern.

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¡°I think this is dipping into the pockets of universities yet more,¡± said Lil Bremermann-Richard, chief executive of Oxford International?Education Group (OIEG), after institutions were hit hard by increases in taxes earlier this year.

¡°They are expected to work harder at compliance, harder at student experience, pay higher National Insurance contributions, work with less investment for domestic students, innovate and pay a new levy.¡±

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Nick Hillman, director of the Higher Education Policy Institute, warned that the idea will be seen as ¡°deeply controversial¡±,?as it was Down Under, and will be viewed by many as a tax on a very successful UK export sector.

The government released little further detail about the levy but said it would be used to fund the higher education and skills sectors. More information was promised by the autumn budget.

Vanessa Wilson, chief executive of University Alliance, warned that the government¡¯s ¡°finger in the air¡± policymaking is risky ¨C criticising the levy as ¡°underbaked¡±.

¡°It is not clear how this levy would be used, or how it would be protected for skills, and there are serious risks inherent in deliberately cutting into the main source of income for universities ¨C some of the UK¡¯s largest employers ¨C when there are very few other levers they can pull to remain financially sustainable.¡±

On the post-study work rights, a visa reduction from two years to 18 months for most graduates was seen as preferable to abolishing it entirely or introducing rules around job types that could have prevented many from accessing it. ?

But most agreed that it will still make the UK a less attractive destination compared?with its global competitors.

Hillman said employers who recruit international students using the graduate route ¡°wanted to see an increase to three or four years, rather than a reduction, as new employees take months to become productive members of the workforce¡±.

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Bremermann-Richard agreed, adding that the change to post-study work rights is ¡°purely to make the UK a less attractive destination for students as it places us at the bottom of the pecking order¡±, and puts further pressure on universities to invest in supporting students to find a graduate level role faster.

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¡°For employers, this duration is going to be very unattractive ¨C so we are left in a tough place.¡±

David Pilsbury, a?commissioner for the International Higher Education Commission, said that the reduction was ¡°as good as it was going to get¡±.

¡°I believe that 18 months is a split-the-difference outcome given we know some voices were calling for the graduate route to be reduced to a year¡­others making the point that a two-year period is essential to maintain competitiveness.?

¡°It will allow them to see how it impacts the numbers without fundamentally changing the nature of the offer ¨C so they have the option to reinstate two years or reduce to one depending on how things pan out.¡±

Given the effect of the sharp increase in migration on public opinion, Steven McGuire, pro vice-chancellor international at the University of East Anglia, said it was good news that a firm cap on student numbers was avoided but said there was still a ¡°big risk¡± to the sector that further changes reinforce a narrative ¡°that the UK is not a welcoming place for international students¡±.

Neal Juster, vice-chancellor of the?University of Lincoln, said that this would ¡°deprive the Treasury and British businesses of billions in lost income¡±.

But Pilsbury, also chief development officer at?OIEG, said that ¡°overall, this is a reasonably balanced response to delivering growth whilst evidencing they have heard what the electorate said loudly in the recent election¡±.

¡°I hope this statement of intent by the government is the wake-up call that sees the sector finally break out of its echo chamber on immigration issues.¡±

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patrick.jack@timeshighereducation.com