Universities Australia, which represents 39 universities, said it had alerted governments to problems relating to student safety, poor-quality colleges, lack of concessions on public transport and immigration matters for two years ago.
"It (Universities Australia) passed on to Australian authorities warnings from officials in China and India relating to student safety. It also conveyed to governments student disenchantment resulting from a perception they were being treated like cash cows," 'The Age' reported.
The daily said Deputy Prime Minister Julia Gillard's office, Immigration Minister Chris Evans' office and Premier John Brumby's office were unable to confirm that the body had alerted them to such problems two years ago.
However, Universities Australia Chief Executive Glenn Withers said that he was disappointed as state and federal governments did not treat the problems as a priority when they were told about them two years ago but acted with urgency only when violent attacks on Indian students attracted intense media attention.
"We were disappointed that earlier warnings took the unfortunate development of street assaults to lead to the reforms that should have been in place already. We saw this two years ago as an issue, tried to transmit it to government and were meeting resistance," he told the newspaper.
Withers said Universities Australia expressed a desire to work with the Coalition of Australian Governments to tackle problems in the vocational training sector that were likely to adversely affect the higher education sector but was not taken seriously.
"We were told basically, 'This is not a matter for you, you are a concern of the Commonwealth and have no place at our table,'" he said. "We were warning: 'Look it's a reputational issue, it's a brand Australia issue, please let us work with you'. The states weren't interested in listening. I think they thought they could just ride this industry to their benefit without worrying about their role in any serious way."
He said Universities Australia had also raised concerns over the link between international education and immigration with the Federal Government. The Federal Government, was so "enamoured of short-term labour market convenience [to] employers" that it did not listen when Universities Australia said immigration should be part of long-term national development, he said.
"Permanent migration should not have been skewed for those purposes. They realised that and began to repair it, but too late," he said.
The report said for the period of July to October last year, constant media coverage on Indian students crisis lead to drop in visa applications to 23 per cent below the figure for the same period a year earlier. Applications from India fell 46 per cent and those from Nepal, Australia's fastest-growing market, plummeted by a staggering 85 per cent.
Russell Mahoney, a spokesman for Gillard, said the Department of Education could not immediately find a record of meetings or correspondence with Universities Australia two years ago. Mahoney and Simon Dowding, a spokesman for Evans, said the Rudd Government regularly consulted with Universities Australia, and that federal and state education ministers last year said they would improve the experience of international students by fixing a range of problems including students' support services and immigration.
While international enrolments from India have reportedly dropped following stricter immigration rules and also safety concerns, it was reported that more private colleges were expected to close as demand dries up.
The report said the sliding demand was hitting universities hard as Australian universities relied on overseas student fees for an average of 15 per cent of their revenue. At La Trobe University new applications from Indian students for the first semester this year were half of last year's, the report said.