Chris Nicholson: Including student migrants in the drive to cut immigration is harming economic growth

Chris Nicholson is director and chief executive of CentreForum, the liberal think tank.

For a party which is pro-private enterprise and keen to boost economic growth, the Conservatives' policies towards control of student immigration defy logic. Of course there have been past abuses of the system, where bogus colleges have brought in students with no real intention of studying, but much of this abuse has been stamped out by changes introduced by the last government. Several thousand institutions that were previously legally able to enrol visa students were dropped from the list. So the fact that the Coalition has now tightened the visa controls further is both counterproductive and hitting the wrong target.

A recent survey by Ipsos MORI showed that while 70 percent of people want cuts in immigration, less than a third want a cut in the number of overseas students. This is not surprising. Home Office statistics show that only about ten percent of students stay on in the UK permanently and are often among the "brightest and best" which the government has said it wants to see stay. In the US student visas are included within the category of "non-immigrant visas", and students are classified as "temporary visitors" rather than permanent migrants. As we argued in our recent publication 'Tier 4 Tears: how student visa controls are destroying the private HE sector' (pdf) there is no good reason why the same rules shouldn't apply here in the UK.

Why does it matter? Well, first, overseas students contribute billions of pounds a year to the UK economy (estimates range from £3-8billion). This is a fast growing market internationally, estimated by McKinsey to be growing at seven percent per annum. There are many countries such as Australia, US and Singapore which are keen to attract students who would otherwise be applying to the UK. Second, around half of non-EU students at UK universities have previously done courses at language schools, or 'pathway colleges'. So clamping down on students applying to these colleges will likely cut the total number of students studying in the UK, as we warned in our 2011 report 'Pathway to prosperity' (pdf).

Third, the government’s visa controls are favouring the public sector at the expense of private sector. Overseas students studying at any UK university can work part time during their degree to help fund their living costs, whilst those studying an identical degree course, designed and validated by the same university, but run through one of its private partner colleges, are not allowed to work at all. Consequently enrolments at private HE colleges are down a staggering 70 percent this year. At least one institution, Cavendish College, has already closed, costing over a hundred jobs.

The government says it wants a more diverse higher education sector with new entrants driving down tuition fees - a laudable aim. Yet its student visa controls are destroying private sector HE colleges that can offer fee rates for degrees which are over a third less than those offered by public universities. Where is the sense in that? The Conservative Party’s wish to curtail net migration to the tens of thousands is clear. But it makes no sense to include student migrants in this total. Doing so is harming economic growth and risks destroying a highly successful part of the UK economy.