A REVIEW of international education yesterday called for an overdue regulatory crackdown on dodgy private colleges that are no more than money-driven "permanent residency factories".

The Baird review's recommendations include a greater focus on financial penalties and more protection for international students.

But there are concerns the focus should not be on the tightening of regulations so much as the enforcement of regulations.

Chaired by former Liberal MP Bruce Baird, the review represents a blueprint for weeding out corrupt colleges. It recommends tougher registration standards under which higher risk providers would pay higher registration fees and an expanded role for the Commonwealth Ombudsman.

Mr Baird told The Australian he had been shocked by the extent of "shonky activity going on".

Given fears of further college collapses, the Baird review has recommended the creation of a single Tuition Protection Service that would allow displaced students to be placed with public universities and TAFEs. High-risk colleges would have to pay higher levies to the protection service than well-established providers.

Although the review criticised ineffective regulatory enforcement and exploitation of links between education and migration, Mr Baird sheeted home the causes of the problem to a fixation with money. "We have all been fixated on the money rather than anything else," Mr Baird said.

College whistleblower Robert Palmer welcomed the review but said the focus needed to be on enforcement. "It is a timely investigation, but it still goes back to who is policing the regulations and making sure the right things happen," Mr Palmer said.

The review recommended a clampdown on private colleges "poaching" students from each other by banning the offering of inducements such as commissions or promises of a faster route to permanent residency. Melbourne's Flinders Street station is a favourite haunt for such colleges passing out flyers to students.

The review warned that current student protection arrangements, under which industry bodies operate different assurance schemes, while the government's protection fund provides back up for placements and refunds, have proved inadequate. It found some students were having to wait six months to be placed and the process was confusing. Last month, the federal government had to inject $5.1 million into its back-up fund.

"There is some degree of urgency to fix it," Mr Baird said.

Extending placements to universities and TAFEs would make it easier to place students and reduce the need for refunds, he said. But public sector institutions are concerned they will be paying a levy to cover a risk that lies entirely in the private sector. Mr Baird said the fee for such low-risk public providers would be low.

Education Minister Julia Gillard welcomed the review and said the government would start implementing recommendations to raise registration standards. Last year, it moved to require all providers to re-register.