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Some Australian universities are paying Chinese students to circumvent the government's travel ban, as they risk losing $2.8 billion to the coronavirus

Jack Derwin
  • Some universities are offering financial incentives to Chinese students who circumvent Australia's travel ban, which requires visitors spend at least 14 days outside of China.
  • Melbourne University is offering students support packages worth up to $7,500 to return, while students enrolled at Western Sydney University are eligible for up to $1,500.
  • With some Australian universities receiving more than $500 million a year in Chinese tuition, the coronavirus is putting their revenues at risk, according to University of Sydney associate professor Salvatore Babones.
  • Visit Business Insider Australia’s homepage for more stories.

Australian universities are growing desperate.

With the coronavirus expected to cost the sector at least $2.8 billion in lost revenue, according to the Centre for Independent Studies, some Australian universities are trying to incentivise Chinese students to recommence their studies as soon as possible.

They're currently facing a government travel ban requiring visitors to spend 14 days outside of China before being permitted to enter the country, in order for symptoms to be detectable.

This week Melbourne University revealed it is offering $7,500 to students to enable them to circumvent travel restrictions, with a similar $1,500 offer having also been made by Western Sydney University to 300 students. In effect, the money allows students to spend two-weeks in countries without a travel ban, such as Thailand, before flying to Australia where they will then be permitted to enter.

However, while the universities each say the payments are for their students' welfare, University of Sydney Associate Professor Salvatore Babones says it's more akin to a cash grab.

"They are treating international students as cash cows," he told Business Insider Australia. "We are encouraging vulnerable youngsters to travel, at a time when their own country recommends against travel, to a developing country where they have little access to health care services. They're putting Thailand at risk and they're putting themselves at risk because if they get sick in Thailand who is going to look after them?

"They won't be allowed into Australia either if they show symptoms so we're really encouraging these youngsters to gamble on a two-week trip to Thailand in the hopes of getting into Australia to finish their degrees. It's morally indefensible."

That's of course not how the universities themselves see it.

"Last week, the Australian Department of Health confirmed travel via another country as a legitimate means of entering Australia. It was in line with this advice that the University has offered to support our students with a one-off $1500 contribution if they wish to take up this approach," a Western Sydney University spokesperson told Business Insider Australia. "Students who choose to not take up this offer will continue to be supported with online resources and remote learning activities."

"Our number one priority is the health and wellbeing of our entire university community. We understand this has been a difficult time for students who have been affected and we are working hard to ensure they can complete their studies on time," University of Melbourne provost professor Mark Considine said, announcing the program.

While universities keep their exact numbers private, Babones' research estimates Chinese students alone represent more than $8 billion of the $39 billion Australian education export market, making them a vital revenue tap that universities are anxious to keep flowing.

For seven major universities, Chinese students account for more than half of all international enrolments, and in some cases account for nearly a quarter of their total fees, according to his research. The University of Sydney, for example, receives upwards of $500 million a year according to Babones' estimates, while the University of New South Wales and the University of Melbourne are among the most dependent on Chinese student fees, with a 25% fall in enrolments costing each in excess of $100 million.

"It is not a disaster for them to sit out one semester and then come back to university a semester later. It's only a disaster for the universities that depend on their tuition," he said.

In fact, it's this over-exposure that he warned of in July 2019 when he published a report noting that seven of the Group of Eight universities -- with the exception of the University of Western Australia, as well as UTS, were at significant risk.

UWS's offer then is perhaps not as financially motivated as Melbourne's. Nor perhaps was the University of Adelaide when, rather than offer money directly to students, it proposed discounted fees and airfare reimbursements for those affected.

Interestingly, the government travel ban has only been expanded until 29 February, with no plan yet announced to extend it further. Not only does Babones believe it should be, but he also argues it now needs to extend to Thailand to avoid universities, and travellers, exploiting the loophole.

"If you let in 20,000 or 40,000 students, somebody is going to have the virus, and it will spread, and it won't be the universities that suffer. This is their moral hazard whereby they get to profit by bringing them in, but they won't bear the costs of treating them which is extremely expensive. It'll be Medicare that will bear those costs," he said.

It comes as the effectiveness of the travel ban period is also under scrutiny. Research suggests the incubation period -- the time it takes for symptoms to appear -- could be longer, rendering the two-week ban inadequate.

The Australian Department of Health and Melbourne University have been contacted for comment.