Those people aren't English. They're Australian.
In both these sentences English and Australian are adjectives. A singular noun would have a qualifier in front of it: He's an Australian, and a plural noun usually ends in an s: They're Australians. In the English language, each adjective only has a single form, regardless of number (i.e. whether it's describing a singular or plural word), which is how we distinguish each case.
They're Australian. (adjective)
They're Australians. (noun)
He's Australian. (adjective)
He's an Australian. (noun)
The word English is a bit more complicated (or simple, depending on your point of view) because it doesn't have an associated gender-neutral noun, only Englishman and Englishwoman and their plural forms.
Those people aren't English. (adjective)
Those people aren't Englishmen and Englishwomen. (nouns)
He isn't English. (adjective)
He isn't an Englishman. (noun)
We could use the words British and Britons, however, they refer to any citizen of the United Kingdom including Wales, Scotland and Northern Ireland as well as England.
Those people aren't British. (adjective)
Those people aren't Britons. (noun)
He isn't British. (adjective)
He isn't a Briton. (noun)
The English are all Britons, but not all Britons are English. Australians are neither English nor British!