Most foreign students who arrive in New Zealand from November will have fewer work rights, the Government has confirmed.

But the Government has compromised, somewhat, on its original plans and will attempt to steer new arrivals away from Auckland.

International students studying for qualifications below degree level will only be able to work for a maximum of two years after their courses finish, and in most cases for only one year if they study in Auckland.

Don Scott Foreign students will be encouraged to study outside of Auckland.

That is down from the current situation where students can work for up to three years after they have finished studying.

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The extra year of work rights for students outside Auckland applies only if students complete their qualifications before 2022.

TOM LEE/STUFF Immigration Minister Iain Lees-Galloway says the changes will help students gain in-demand skills for economic growth, incentivise study in the regions and help reduce the risk of student exploitation.

Immigration Minister Iain Lees-Galloway said the changes would help ensure international students coming to New Zealand gained in-demand skills for economic growth, encourage students to study "in the regions", and would help reduce the risk of student exploitation.

The changes have been prompted in part by concerns foreign students are taking up lower-level courses as a backdoor to immigration.

The Government had originally proposed immediately reducing post-study work rights to one year across the board for non-degree courses and removing them completely for foreign students taking NCEA level 7 courses that lasted for less than two years.

Post-study jobs that students take on will no longer have to be "employer-assisted", in a change designed to prevent exploitation by unscrupulous employers.

The announcement by Lees-Galloway followed feedback from 2000 submissions.

Lees-Galloway said it was difficult to pinpoint the exact financial impact because they could not be certain about people's behaviour.

STUFF Universities New Zealand executive director Chris Whelan said providing good graduate outcomes was key to attracting the best students from overseas.

Ministry of Business, Innovation and Employment labour and immigration policy general manager Ruth Isaac said there could be between 6000 and 1200 fewer students starting, which would flow into $12 million less in fees up to $59m at the higher end.

Clare Bradley, chief executive of Aspire2 International, which is one of the country's largest private training establishments, said it was great the Government had listened and made some changes to its original proposals.

The company had estimated the Government's original proposals would have resulted in 44,000 fewer students coming to New Zealand each year, costing the economy more than $1 billion a year.

STUFF Whitireia and WelTec chief executive Chris Gosling said under the original student visa proposals, 25 per cent of his existing students would have had no work rights.

It had warned in its submission that it might have to close its international division and stop courses part way through. Bradley could not immediately comment on whether that remained a possibility, describing the changes announced on Wednesday as complex.

Universities New Zealand executive director Chris Whelan welcomed the new rules.

Providing good graduate outcomes was key to attracting the best students from overseas, he said.

"Though most international students return to their home countries after they graduate, a proportion have the qualifications and skills that New Zealand employers need but can't find enough of from pool of domestic graduates.

"Having the option of staying in New Zealand for up to three years after graduating makes New Zealand a more attractive study destination for these international students while contributing to our businesses and economy," he said.

Chief executive of Whitireia and Wellington Institute of Technology (WelTec) Chris Gosling said it was no secret the polytechnics had serious concerns around the possible impacts of the original proposals.

He was pleased the Government listened and made "significant" changes.

"We originally envisaged up to 45 per cent of our international students might not turn up as a result … 25 per cent of our existing students would have had no work rights."

The National party said it welcomed the Government's "major backdown" on post-study work rights for international students but said the damage to New Zealand's international reputation had already been done.

In a joint statement, National's Immigration spokesman Michael Woodhouse and Associate Tertiary Education spokesman Simeon Brown said the immigration minister had been forced into a u-turn on his proposed changes after he was told it could cost more than $1 billion a year.

CHANGES

From November, options for students will include:

- a one-year post-study open work visa for students studying Level 4 to 6 and non-degree Level 7 qualifications in Auckland

- an additional year for graduate diploma graduates in Auckland who were working towards registration with a professional or trade body

- a two-year post-study open work visa for students studying Level 4 to 6 and non-degree Level 7 qualifications elsewhere, provided study is completed by the end of December, 2021

At that point the entitlement for post-study work rights reverts to a one-year post-study open work visa for students studying Level 4 to 6 and non-degree Level 7 qualifications with an additional year for graduate diploma graduates who are working towards registration with a professional or trade body.

Many foreign students studying degrees will benefit from the new rules as they will continue to be able to work for three years but without the previous requirement for two of those years to be in "employer-assisted" work.

But students studying at Level 8 will need to be in an area specified on the Long Term Skills Shortage list in order for their partner to be eligible for an open work visa – and in turn for the partner's dependent children to be eligible for free domestic schooling.