As Australians head to the polls, the federal election campaign has laid bare the economic strategies of both major parties — and international students find themselves at the centre of a new funding equation.

Both Labor and the Coalition have announced significant increases to student visa fees to help fund their campaign promises, underscoring just how closely tied migration policy now is to budget bottom lines.

Visa Fees Rise: A New Source of Budget Savings

If re-elected, the Labor government plans to raise the international student visa application charge from A$1,600 to A$2,000, effective from 1 July 2025. The move is expected to generate $760 million for the federal budget over the forward estimates — a notable portion of the $1 billion in new savings the party says it has found since the start of the election campaign.

The fee hike will not apply to applicants from Pacific Island nations or Timor-Leste, in line with regional partnership agreements.

Meanwhile, the Coalition has proposed an even steeper increase, promising a $5,000 fee for students applying to Group of Eight universities, and $2,500 for all other international applicants. The changes form part of the Coalition’s broader strategy to sharply reduce migration and limit enrolments in public universities by 25%.

What’s Driving the Fee Hikes?

Election costings — detailed financial plans showing how campaign promises will be funded — are a key part of every federal race. Labor's latest figures aim to highlight fiscal responsibility, contrasting their targeted savings with what they describe as unclear or uncosted proposals from the Coalition.

According to Treasurer Jim Chalmers, raising visa fees is a "sensible and fair" way to support cost-of-living measures like:

• A $1,000 instant tax deduction for work-related expenses
• Investments in Medicare, housing, and HECS debt relief

The combined effect of Labor’s savings package will reduce the projected budget deficit from $151.6 billion to $150.5 billion.

“We’ve got rid of a lot of waste and rorts,” said Finance Minister Katy Gallagher. “This allowed us to reinvest in the services Australians rely on — without cutting jobs or frontline programs.”

Why Are International Students Being Targeted?

International students contribute over $40 billion annually to the Australian economy and support over 250,000 jobs, particularly in education, retail, and housing. But recent years have also seen record numbers of arrivals, leading to concerns about housing demand, urban congestion, and pressure on services.

The visa fee increases reflect growing public and political interest in “user-pays” policies — where students contribute more directly to the infrastructure and services they use.

However, critics argue that the move risks undermining Australia’s competitiveness in the global education market. Other English-speaking destinations like Canada and the UK have also tightened student policies recently, meaning higher fees could push students to look elsewhere.

Impact on Migrant Communities — and the Ballot Box

Election analysts say immigration has become a polarising issue. While many Australians are concerned about population pressures, others — particularly in diverse and fast-growing communities — see migration as essential to the economy and family life.

The Coalition’s push for a 100,000-place cut to net overseas migration, alongside harsh rhetoric about student visas and working rights, appears to have alienated some multicultural voters.

“Where the electorate was wanting hope and a positive plan, they were offering negativity,” said Simon Welsh of RedBridge Group. “That rhetoric on immigration was definitely a drag in seats with large Chinese and Indian communities.”

This dynamic was reflected at the ballot box: Labor retained key multicultural seats like Hawke, Gorton, Chisholm, Parramatta and Reid, despite early signs that some were in play.

Will the Economic Math Add Up?

Despite the heated debate, some experts say the visa fee changes — while financially significant — are only a short-term lever. Professors Peter McDonald and Alan Gamlen from the ANU Migration Hub predict that net migration will fall sharply by 2027, as visa extensions granted during the pandemic expire and international student enrolments decline.

They warn that while migration has been “weaponised” in political discourse, the real challenge is ensuring long-term, sustainable policy that balances economic needs with social cohesion.

Final Thoughts

With both major parties proposing substantial hikes in visa fees, international students are now playing an unexpected role in funding Australia’s future. Whether these policies strengthen the economy — or risk deterring the next generation of global talent — remains to be seen.

For now, the message is clear: the cost of studying in Australia is rising — and so is its political significance.