Immigration

Polytechs claim $70m in losses over visa delays

As the Education Minister gears up to announce a major reform of the vocational education sector, polytechs are left millions out of pocket due to visa processing delays. Laura Walters reports.

Polytechs claim they will lose $70 million this year to visa processing delays, due in large part to a large volume of high-risk student visa applications coming through Immigration New Zealand’s Mumbai office.

New figures show on top of the $33m expected to be lost in the first semester, polytechnics have calculated $37m in losses for the second semester.

The sector and Education New Zealand have also pointed to the reputational damage caused by the delays.

But Education Minister Chris Hipkins has pointed the finger back at the polytechs, saying they were aware heavy recruitment of students in high-risk markets would mean widespread delays.

The further processing delays come as the Government gears up to release its finalised plan for the review of the vocation education sector on Thursday.

The sector has been under scrutiny in recent years, due to under-performance of some polytechs and training institutes. The Government plans to combine the training providers into a single entity – the New Zealand Institute of Skills and technology – as well as overhaul the funding model.

The process has been contentious, with the industry pushing back on a short consultation period, and the minority of high-performing providers raising concerns about being disadvantaged by the proposed model.

Parliamentary written responses to National Party tertiary education spokesperson Shane Reti show the bulk of the delay problem sits with the volume of applications coming into Immigration New Zealand’s Mumbai office.

At the start of July, when the second semester kicked off, there were almost 2000 unallocated polytech applications sitting in that office.

Meanwhile, 200 student visa applications relating to study at polytechs were withdrawn in the six months to July 1. That is double the number withdrawn during the previous six months.

And the average processing time in the Mumbai office went from 42 days in February, to 66 days in July.

“We’ve been very clear with the providers that if they continue to try and recruit in those areas, where we know there’s been a prevalence of that kind of activity, then they do need to expect there will be some delays in that.”

Reti said this increase in processing times was causing the medical certificates required for a visa to expire before the application was processed.

“This hassle is causing frustrated students to abandon their New Zealand applications and take their money elsewhere.

Immigration Minister Iain Lees-Galloway said he had asked Immigration New Zealand to treat this as its top priority, but it was not as simple as just speeding up the process.

As reported by Newsroom earlier this month, the majority of student visa applications processed in the Mumbai office are considered high-risk. All applications out of three of India’s northern states are immediately categorised as high-risk.

At the start of April, Immigration NZ was processing 6988 student visa applications, with 91 percent deemed medium or high risk.

There are a number of factors that contribute to an application’s risk status but if there is a chance part of the application or supporting documentation could be fraudulent, it is flagged as medium or high-risk and immigration officers are required to go through a more rigorous verification process.

With the number of confirmed cases of fraudulent visa applications on the rise - up 88 percent last year - officials are scrutinising applications through phone interviews, independent verification of the documentation, and third-party checks, including security checks. This level of assessment slows down the process.

Immigration New Zealand said there had been a general improvement in the quality of applicants, particularly from India, since 2016. However, some education providers continued to focus on quantity over quality.

'Polytechs too reliant on international students'

Hipkins told Newsroom he was keeping a close eye on the situation, and while he did not want to diminish the concerns raised by the polytechs, the Government would not tolerate fraudulent applications.

Some tertiary education providers continued to recruit a large number of students from those high-risk markets, where there has been evidence of visa application fraud in the past, he said.

“One of the things the Government has been worried about for some time is that the polytechs are too reliant on international students, generally, whether it’s visa processing being the thing that causes concern, or some other international event."

The Government expected Immigration New Zealand to take a risk-averse approach to processing those applications.

“We’ve been very clear with the providers that if they continue to try and recruit in those areas, where we know there’s been a prevalence of that kind of activity, then they do need to expect there will be some delays in that.”

The was a new system in place to speed up the processing of low-risk applications, but that would not solve this problem.

“One of the things the Government has been worried about for some time is that the polytechs are too reliant on international students, generally, whether it’s visa processing being the thing that causes concern, or some other international event,” Hipkins said.

“We live in an era and a time where there’s a lot of global uncertainty, and we cannot rely exclusively on international students to keep our institutions afloat. We’ve actually got to get them onto a more stable footing.”

'Too much uncertainty'

National’s Shane Reti said these delays added to the level of uncertainty currently facing the vocational education sector.

“The potential damage to each polytechnic from just the Mumbai office in Term Two is huge,” he said.

The sector estimates each student lost has an economic impact of at least $20,000.

Based on the number of unallocated or withdrawn visa applications, the average rate of approvals, and the $20,000 per student figure, some polytechs are set to lose millions, with Toi Ohomai Institute of Technology $10.7m out of pocket, Ara Institute in Canterbury looking to lose $6m this year, and Otago Polytechnic left almost $3m short.

National's tertiary educations spokesperson Shane Reti says the extensive delays are adding to sector uncertainty caused by significant reform. Photo: Lynn Grieveson

The international student market is important to polytechnics, especially as the sector has recently announced a collective $30m deficit.

The lost international student revenue from just semester two, and just the Mumbai office, would have covered this deficit, Reti said.

This loss of revenue comes at a time when Hipkins is about to announce the biggest reform of public entities in 30 years, looking to centralise and amalgamate regional polytechnics into one mega polytechnic.

“Every annual report to date is flagging the risk and uncertainty this is causing and the last thing the sector needs is Immigration New Zealand messing around with student visas," Reti said.

“The Government needs to urgently address the visa processing issues in Mumbai and provide guaranteed processing benchmarks and a schedule they will be held accountable to.”

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