The Albanese government will radically simplify Australia’s migration system by bringing in a three-tiered assessment designed to cut red tape and reduce delays to permanent residency.
The home affairs minister, Clare O’Neil, signalled at the National Press Club on Thursday that the government would move to scrap labour market testing in favour of new skills assessments and promised fairer pay thresholds for incoming workers, in response to a migration review.
Reforms will focus on improving the integrity of the visa system, shifting international student visas away from a de facto work visa towards more skilled graduates and overhauling the points system for permanent migration to benefit those able to make the greatest contribution to Australia.
The federal government will also use national cabinet in Brisbane on Friday to begin planning with the states for services and infrastructure to support population growth. O’Neil said it was “a bit startling” that there was “no genuine mechanism at the moment for us to plan for population changes”.
O’Neil said that by the end of 2023 – after another round of consultation and the implementation of the government’s final strategy – “all temporary skilled workers will have a pathway to permanent residency”.
O’Neil said the focus was the “quality of our migration program”, at first seeking to avoid debate about whether the policy would result in a “big Australia or small Australia”.
But in answer to questions, O’Neil said “if we implemented all the things I’ve discussed, the consequence of that would be a smaller migration program for the country”.
The reforms have received broad support – with both the Australian Council of Trade Unions and employer groups such as the Australian Chamber of Commerce and Industry – praising measures to improve pathways to permanency and attract skilled workers.
Ahead of O’Neil’s speech, the prime minister, Anthony Albanese, said “the migration system that we inherited was broken”, citing the fact that more than 1 million people were waiting for visas.
“What we need to do is to make sure that we identify the skills we need, identify the regions where we need additional workforce, and tailor our migration system so that it benefits those people who come to Australia, but more importantly as well, so that it benefits our national interests,” Albanese said.
The report’s central recommendation is to create three tiers of regulation for migrants: a “light-touch” approach for very skilled migrants on high salaries; a mid-level cohort of migrants who earn above the amount of the temporary skilled migration income threshold; and a lower-wage cohort in sectors with skills shortages such as the caring sector.
The government has accepted this recommendation and will work with states, business sector, unions and civil society to determine the rate of the top threshold.
O’Neil said at the press club the new temporary skilled migration income threshold for the second tier would be $70,000, up from $53,900.
O’Neil explained this was considered the “goldilocks” level because it was high enough to ensure “a skilled worker program, not a guest worker program” but low enough not to exclude younger people from the intake.
For the third tier, O’Neil said the government would create a “proper, capped, safe, tripartite pathways for workers in key sectors, such as care”.
Rather than occupation lists, O’Neil said that “proper, evidence-based assessments of skills needs” will be conducted by the department and Jobs and Skills Australia.
This will replace “the current outdated approaches that everyone agrees are not working” she said, signalling that labour market testing – the requirement for employers to advertise jobs domestically before bringing in workers – will likely be abolished.
Changes to ensure students ‘genuinely in Australia to study’
An outline of the government’s response by home affairs department confirms that it will enact reforms to ensure “that all international students are genuinely in Australia to study, including by tightening requirements and by strengthening the quality assurance of education providers”.
It also committed to reducing the time students spend on bridging visas, with an easier path to graduate visas.
At the Press Club, O’Neil nominated care work, technology, engineering and construction as skills needs that could be addressed by better prioritisation of international students.
The reviewers said they were “greatly concerned by the way the current system heightens the risk of exploitation faced by temporary migrant workers”.
In particular, employer sponsorship has “created the opportunity for exploitation … because it stifles the ability and willingness of an employee to report non-compliance”, the report said.
The review proposes to allow temporary migrant workers to move from their current job and have up to six months to find work with another employer within the same sector or type of work.
The Albanese government agreed on greater protections, including “increasing mobility” of temporary migrants “without jeopardising their ability to stay in Australia”.
“Migrants will have clearer pathways to permanent residence, circumventing the risk of migrants being left in ‘permanently temporary’ limbo,” the government committed.
The report said “successive governments” had imposed caps on permanent migration – currently 195,000 – while “the temporary migrant cohort has been demand-driven and has doubled in size since 2007 and now stands at 1.8 million people”.
With the Coalition accusing Labor of pursuing a “big Australia”, the Albanese government hopes to improve the social licence for migration by working with state and territory governments to increase investment in housing, infrastructure and services.
Reforms to improve skilled migration will take priority over family-related migration. Although the government acknowledged the “need for reform of the family program”, the outline said this “will be considered separately” to the final strategy for late 2023.
Greens immigration spokesperson, Nick McKim, said the review had “no plan to fix a broken family reunion visa system by making it faster, fairer, and more affordable”.
