Under legislation to establish the Australian Tertiary Education Commission, introduced into Parliament in November 2025, a function of ATEC is to ‘allocate a maximum number of international student commencements to ESOS registered providers at the direction of the Minister’. This appears as section 11(h) of the Universities Accord (Australian Tertiary Education Commission) Bill 2025.

Does this create a power to cap international student numbers?

The ATEC bill’s explanatory memorandum states that further legislation will set out a framework for how international student commencements will be allocated (p. 8). But does section 11(h) on its own create a power to cap international students independently of this framework?

On its plain meaning I think it does. Section 33(1) of the Acts Interpretation Act 1901 says that: ‘When an Act confers a function or imposes a duty, then the power may be exercised and the functions or duty must be performed from time to time as the occasion requires.’

The minister can, by legislative instrument, create rules ‘necessary or convenient for carrying out or giving effect to this Act’, adding more detail to how the caps would work: section 75(1)(b), Universities Accord (Australian Tertiary Education Commission) Bill 2025.

The capping process

While ATEC will formally allocate commencing international student places, under the bill as it stands the process will differ significantly from the allocation of Commonwealth supported places.

The minister will not seek advice or recommendations from ATEC on international education (nothing in section 41 ‘Advice and recommendations’).

Although international student caps are primarily based on migration concerns, there is no requirement to consult the minister responsible for migration. Other parts of the bill include consultation requirements when decisions cross portfolio responsibilities, such as the VET minister, the science minister or the research minister, if these are the not the same person as the education minister: section 15.

Potentially, the allocation of international student places to a university will be ‘at the direction of the minister’ when otherwise the minister cannot give directions to ATEC commissioners in allocations to specific providers: section 71(2)(c).

There is ambiguity on what ‘at the direction of the minister’ refers to. On the reading in the previous paragraph, the minister can give directions at the provider level. That is consistent with the capping methods in the government’s first attempt to impose caps. Another reading is that the minister will direct ATEC on the total cap and ATEC will allocate at the provider level. This second interpretation is consistent with background briefings to universities that suggest ATEC will do the allocating, taking into account each university’s financial position and their balance between international and domestic students.

Penalty provisions

The problem for the government is that the ATEC bill as it stands does not include a clear and workable penalty provision.

While the minister can create rules ‘necessary or convenient for carrying out or giving effect to this Act’, these cannot ‘create an offence or civil penalty’: section 75(2)(a).

It’s not clear from the bill whether international student place caps will be in mission based compacts, but Department of Education briefings to universities have said that this will be the case. The bill’s explanatory memorandum suggests that future allocations of Commonwealth supported student places may depend on provider performance against mission based compacts (pp. 2-3). But a Commonwealth supported place penalty for excess international students, combined with restrictions on CSP over-enrolments, means domestic students who might have wanted to attend that university miss out. That’s unfair to them and would undermine the government’s participation and attainment objectives. Also, non-university higher education providers won’t have compacts.

As a result, the ATEC international student caps would share a problem with the current migration ‘indicative allocations’ currently applying to international education providers. The government can create some pain for providers who exceed their caps but cannot stop them doing it.

Conclusion

As the government clearly plans further legislation on international student caps it is hard to see why section 11(h) needs to be in the ATEC bill. It should be removed.