The Migration Advisory Committee (MAC), which provides the government with independent advice on immigration, has also rejected calls to reintroduce a post-study work visa, along the lines of the two-year visa which was abolished by the government in 2012. It has, however, proposed extending a current pilot to give all Masters-level students an extended six-month period after graduation in which to find work; and to make it easier for students to switch from the Tier 4 student visa route to a Tier 2 work visa even once they have returned home.
Immigration law expert Euan Smith of Pinsent Masons, the law firm behind Out-Law.com, said that the MAC's conclusions would at first appear disappointing to universities, who last week proposed the introduction of a new visa that would allow graduates to remain and find work in the UK for up to two years after graduation, sponsored by their university.
"However, the MAC does accept that the data that has caused them not to support this proposal is limited and, if further evaluation suggests otherwise, is willing to change its view," he said. "The MAC does support and recommends that a full evaluation of the merits of a new post-study visa is undertaken. All is not therefore lost."
"The specific recommendations by the MAC are limited in practice, but have a good chance of being implemented by the government. In particular, the proposed extension of the ability of Tier 4 graduates to switch to Tier 2 work status up to two years after graduation and also to be able to make such applications out of the UK is likely to be helpful to students in practice. The proposal to extend the period leave given to all Masters students to an additional six months after completion of studies is also welcome – this is effectively like being given a six-month post-study work visa," he said.
"The proposed additional 12 month post-study work permission for all those who complete their PhD does also help create an effective 12 month post-study work visa for PhD holders. Effective communication of the changes, if implemented, may be as important as the changes themselves," he said.
Universities expert Gayle Ditchburn of Pinsent Masons said that the report came at an already challenging time for universities.
"With Brexit on the horizon, and Philip Augar's review of post-18 education and funding due to publish its conclusions early next year, universities face considerable uncertainty over where their students are going to come from in the future and how their places will be funded," she said.
"There has been some suggestion that the Augar review could recommend a reduction in the maximum rate at which home and EU tuition fees could be set and/or a return on student numbers which, if coupled with a restriction in higher fee-paying international students, could leave universities with a significant funding shortfall. As the MAC acknowledges, international students can be a vital source of income for institutions, whose fees may cross-subsidise research and domestic student places," she said.
Over 750,000 students come to the UK to study each year, and the UK has historically been the second most popular destination for overseas students after the US. However, the MAC acknowledges that there is a "real risk" that the UK will be overtaken by Australia in popularity in the near future, while the UK's impending departure from the EU "poses new threats".
Although many of the responses to the MAC's call for evidence on international students argued that students should be removed from the government's migration figures, "none suggested a practical way in which this might be done", it said in its report. While respondents also backed a more generous post-study work regime, the MAC said that it was "important that any scheme has benefits that extend beyond the education sector".
"We do not recommend a separate post-study work visa though our proposals on automatic leave to remain at the end of study have some of the same effect," it said.
"One reason for not recommending a longer post-study work period is that the earnings of some graduates who remain in the UK seem surprisingly low and it is likely that those who would benefit from a longer period to find a graduate level job are not the most highly skilled. We accept that the evidence for this is not as strong as it could be: one of our recommendations is that there is a proper evaluation, by us or others, of what students are doing in the post-study period and when they move onto other work permits. If, after that evaluation, a longer post-study work period seems warranted our advice could change," it said.
The report recommends extending the six-month post-study leave period, currently available to MSc students on a pilot basis, to all Master's level graduates, provided that a review of the pilot "does not uncover any evidence that this would not be sensible". It also recommends incorporating the 12 months leave to remain for PhD graduates into the original visa duration subject to meeting progress requirements and course completion, therefore doing away with the need for graduates to apply separately for the 'doctoral extension' scheme.
The MAC has also recommended giving all graduates of UK higher education institutions a period of as much as two years to obtain a job in the UK and switch from a Tier 4 to a Tier 2 visa, regardless of whether they have returned to their home country. Currently, students who obtain a job before they leave the UK can switch to Tier 2 without their employer having to pass the resident labour market test or pay the immigration skills charge. There is also no cap on the number of Tier 4 students switching to Tier 2. Students should also be permitted to apply for a Tier 2 visa as soon as a job offer has been made, even if this is many months before the proposed start date.