The "back-door" to New Zealand residency for lower-qualified international students may have led to students targeting New Zealand as a path towards residency, rather than study purposes.
And officials advising the Government on immigration policy say that the rise in international students becoming residents has lead to a "gradual decline in the average skill level of new permanent residents observed in the last five years".
The advice is contained in ministerial briefings from the Ministry of Business, Innovation and Employment from November, released under the Official Information Act.
The Labour-led Government wants to improve the integrity of the system to make sure international education system is focused on quality education for genuine students, and to remove the "back door" path to residency for lower-qualified international students.
International students can work in New Zealand under the post-study work visa after they finish studying, but this has allowed some students to become permanent residents who might not have otherwise been approved.
The briefing papers say that students from India, in particular, show a higher rate of transition from student visa to permanent residency, "suggesting that students from some markets may be more driven by migration prospects than education quality when choosing to study in New Zealand".
In 2016/17, 18,266 were granted a post-study visa. The papers say that closing the "back door" would affect between 9000 and 12,000 students.
Immigration Minister Iain Lees-Galloway has said that he wants to prioritise matching migrant skills to the appropriate regions, cracking down migrant exploitation, and closing the "back door" path to residency.
Officials added that international students who focus on residency rather than study are more open to potential exploitation from an employer.
"This is leaving them open to accepting arrangements to buy job offers, and thus become a party to immigration fraud, in order to gain residence."
The briefing also says the growth in international student numbers potentially pushed out New Zealand workers and suppressed wages, but there was limited data to show the extent of this.