Australia's migration system is "broken" according to a review which warns "tinkering" around the edges will not work and "major reform" is needed to attract the best workers, drive economic growth, and protect against exploitation.
The review, led by former public service chief Martin Parkinson, makes the case for wholesale reform to the migration system to prevent Australia becoming a nation of "permanently temporary" residents.
The 200-page report proposes changes to the skilled migration program, student visas and employer sponsored visas and outlines the steps needed to ensure Australia can "reap the opportunities and navigate the challenges" that arise over the next two decades.
"The migration system is neither fast nor efficient and is often perceived as unfair," the report states.
"Users, current and potential migrants and businesses find the system unnecessarily complex and difficult to navigate at all levels."
Home Affairs Minister Clare O'Neil commissioned the review last year, and in a speech to the National Press Club on Thursday is expected to outline how the government will respond to the structural problems it identified.
While the review acknowledges that skilled migration has helped fill skills gaps and contribute to productivity growth it said it is "not effectively targeted to either current or future needs".
It found that the points test used to select skilled migrants fails to identify the best applicants and describes the skilled occupation list as "outdated" and lacking a "strong evidence base".
"They do not reflect current or anticipated skilled labour needs, including to support the transition to a net-zero economy or to build critical and sovereign capabilities," the report states.
"There is growing international competition for highly skilled migrants and Australia risks falling behind without more innovative and attractive visa products and service delivery."
Dr Parkinson's review warns that Australia's migration system is failing to retain "the best and brightest" international students in the country, with many struggling to transition into the labour market or consigned into jobs below their skill level.
"The student visa program should be an important source of high performing skilled migrants but has not delivered on its potential," the review found.
"Various student and temporary graduate visa setting inhibit students' opportunity and ability to show they can succeed in the Australian labour market."
Ms O'Neil has previously argued that the migration system needs an overhaul and many of the reviews findings are aligned with the observations she made in a speech earlier this year.
Australia's temporary migrant cohort has doubled in size since 2007 to 1.8 million people while permanent places have remained stable.
Noting the shift to temporary migration, Dr Parkinson's review found that Australia "needs longer-term and holistic migration planning".
"That has caused harm to Australia and to migrants, and undermined community confidence in the migration system," the report said.
"Had they been asked, it is hard to conceive of Australians willingly agreeing to the creation of a 'permanently temporary' cohort of workers, akin to guest-workers seen in some other countries."
Existing systems have been ineffective in protecting migrant workers from underpayment, with the review arguing the minimum salary threshold for temporary skilled migrants is "too low".
The threshold for the minimum amount a worker on an employer-sponsored visa must be paid has been frozen at $53,900 since 2013.
"There is widespread evidence that temporary migrant workers are exploited, and aspects of the migration system heighten this risk," it said.
"While the majority of employers aim to do the right thing, sponsorship arrangements that tie temporary workers to their sponsoring employer create a power imbalance that facilitates exploitation by the unscrupulous."
The report also criticises Australia's fragmented approach to attracting lower paid workers to fill labour shortages in areas like the care sector.
"Australia lacks an explicit migration policy focusing on lower paid workers and has taken a piecemeal approach that is not meeting our needs or protecting vulnerable migrant workers."
The review warns that elements of the migration system are "undermining" Australia's influence and trade connections in the Indo-Pacific region with regional business and political leaders reporting they find it too difficult to travel to Australia.
"The migration system has not assisted Australia to build diaspora communities from our closest neighbours in South-east Asia and the Pacific, again limiting people to people connections," it stated.
However, the report cautions against measures that could encourage a "brain-drain" that robs Pacific Islands of workers.
