It is difficult to know whether this government will best be remembered for its U-turns or its stubborn refusal to face facts, but both provide an opportunity for Labour. In June 2011, only days after the Home Office had acknowledged that its changes to international student visas would cost the UK economy £2.4bn, I secured a backbench business debate on the issue. Immigration minister Damian Green struggled to justify an ideologically driven and ill-considered policy that would damage economic growth in the interests of helping the government meet its net migration target.
Over a year on, the demand for change is growing. Business leaders and Conservative MPs have joined the call for students to be taken out of the net migration targets. As Simon Walker, director-general of the Institute of Directors, wrote recently, this ‘simple statistical change has the potential to neutralise what competitor countries see as a spectacular own goal.’
Of course, international students are not valued by universities just for the income that they bring. But the £7.9bn they contribute to the UK economy annually, through tuition fees and spending in local communities, is important. Across the country, hundreds of thousands of jobs depend on international students. It is a great success story, but it could be even better.
Driven by the world’s growing economies, international demand for university education is expanding rapidly. The Department for Business, Innovation and Skills estimates that the UK could double export earnings from the sector by 2025. With the world’s best universities after those of the United States, we should be seeing huge growth, but we are losing market share. The reason for this is the negative message that the restrictions to the student visa system have sent to prospective students around the world.
Losing out in these markets is not simply a short-term financial loss. Those who study in the UK develop great affection for the country. When they return home, and rise to prominent roles in business and politics, they turn first to the UK when making key decisions on trade and investment. And business benefits enormously from the contribution of international postgraduates to research and development.
Australia, which is winning more international students, has learnt this lesson. Political concerns led them to tighten student visa rules in 2010; then falling applications led them to reopen opportunities. In the US, too, restrictions imposed after 9/11 have been loosened and international students are not counted as migrants for policy purposes.
There are signs that the government is preparing to concede. In the face of growing pressure, Downing Street sources recently indicated that they backed change. If the government does remove students from net migration targets it would be tempting for Labour to accuse it of fiddling the figures. But that would be a mistake.
The immigration debate is a difficult one, but we should welcome international students being removed from it. Including students in net migration targets damages our universities, but it also distorts policy development on immigration. And supporting their removal from the targets is another demonstration of how progressive policies can support economic growth.
Paul Blomfield is MP for Sheffield Central and secretary of the all-party parliamentary universities group
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