Budget Review 2020–21 Index
Dr Susan Love and Harriet Spinks
Net Overseas Migration
Net Overseas Migration (NOM) forecasts are a component of
the assumptions used in the Budget. The forecasts in the Table below are
produced by the Centre for Population within the Treasury.
Table: Net overseas migration, for
years ending 30 June
Source: Australian Government, Federal financial
relations: budget paper no. 3: 2020–21, Table A.5 p. 86.
NOM is the difference between migrant arrivals in Australia
and departures from Australia. Migrant arrivals in Australia are counted in NOM
if they are in Australia for a total of 12 months or more during a 16-month
period. NOM affects population growth, which is in turn one of the drivers of
economic growth. Population growth is expected to slow from 1.2 per cent in
2019–20 to 0.2 per cent in 2020–21 and 0.4 per cent in 2021–22—the lowest growth
in over a hundred years (Budget
Strategy and Outlook: Budget Paper No. 1: 2020–21, p. 2-13).
With migration largely halted due to COVID-19 restrictions,
NOM is forecast to drop to a level of -71,600 in 2020–21, the first time since
1946 that it has been negative. The forward estimates then forecast a
subsequent year of negative NOM, followed by a gradual return to levels over
200,000 by 2023–24. The low NOM over the forward estimates is not projected to be
made up through high NOM in the future, meaning lower projected population
levels than previously expected.
Paper no. 1 sets out assumptions on the return of international travel,
beginning with small pilot programs of international student arrivals from the
end of 2020 and a gradual resumption of permanent migration in the second half
of 2021 (p. 2-6). It also notes possible alternative scenarios, including
‘downside scenarios’ where the opening of international borders is delayed due to
further outbreaks of COVID-19, and ‘upside scenarios’ where an early vaccine
and successful pilots of international student arrivals could lead to more
rapid recovery (p. 2-15).
Actual NOM is calculated by the Australian Bureau of
Statistics (ABS). The latest annual
figures are for 2018–19. The latest
quarterly estimates are
as at 31 March 2020. In the twelve months to that date, NOM was 220,500, down
by 12 per cent on the previous year but still contributing 61.8 per cent of Australia's
annual population growth. The decline was due to an increase in departures, in
part because of the impacts of COVID-19, but this reflects only the early
stages of international travel restrictions. Australia closed
its borders on 20 March 2020, tightly restricting both arrivals and
departures. The impact on international travel is presented in the ABS Overseas
Arrivals and Departures dataset.
Affairs reports show that in recent years, NOM has been driven mainly by
temporary visa holders—they formed 64.3 per cent of overseas migrant arrivals
in 2018–19. (Many temporary visa holders leave Australia in future years—52.8
per cent of migrant departures in 2018–19 were temporary visa holders.) The
largest category of temporary visa holders making up NOM is international
students: 173,000 in 2018–19, forming 32.2 per cent of all migrant arrivals.
Permanent visa holders, that is, those arriving from
overseas counted within the Migration Program, made up only 15.4 per cent of
NOM in 2018–19. Permanent visas may also be granted to people already in
Australia on temporary visas. In 2020–21, around two thirds of permanent visas
are forecast to go to people already in Australia, with more places allocated
in particular to partner visas drawn from onshore (discussed further below).
The resumption of arrivals of international students will therefore be a key
factor in whether the NOM projection is realised for 2020–21 and whether NOM
will recover in the forward estimates.
The Migration Program provides permanent visas for skilled
and family migrants to Australia. The planning ‘ceiling’ for the program in
2020–21 has been set
at 160,000 places, the same as in 2019–20 (although in 2019–20
only 140,366 visas were granted (p. 9), largely
due to disruptions caused by the COVID-19 pandemic). However, this does not
mean that 160,000 new migrants will come to Australia in 2020–21. Over the last
several years, around half of permanent visas granted under the Migration
Program each year have gone to people who are already in Australia on a
temporary visa. In 2020–21, this proportion will
increase to around two thirds. Granting the bulk of Migration Program visas
to people already in Australia will allow the Government to fill places in the
Program without adding significantly to the cohort of citizens and visa holders
overseas wanting to travel to Australia, and increasing pressure on arrivals
caps and quarantine capacity.
The family stream of the Migration Program usually accounts
for around a third of the places available. In 2020–21 this
will increase to around half (77,300 places, plus an additional 3,000
places for child visas). This significant increase in family visa places is due
to an almost doubling in the allocation for partner visas—72,300 places in
2020–21, compared to a planning
level of 39,799 in 2019–20. The Government has faced recent criticism over
what has been described
as a ‘blowout’ in processing times for partner visas, resulting in a large
backlog of applications. As at 30
June 2020, there were 96,361 partner visa applications ‘onhand’ (p. 50). The
significant increase in partner visa places for 2020–21 is likely an effort to
clear this backlog.
English language requirement for
Alongside the announcement of the planning level and visa
allocations for the 2020–21 Migration Program, the Government announced
that it intends to introduce an English language requirement for partner
visa applicants, and partner visa sponsors who are permanent residents (that
is, not citizens). Unlike skilled visas, for which applicants must generally
demonstrate a specified level of English language proficiency, there is
currently no such requirement for applicants for family stream visas, as these
are designed to allow people to reunite with family members rather than explicitly
The Government’s rationale for a language
requirement for partner visa applicants (but not other family visa applicants,
such as parents and children) is that speaking English is ‘critical to getting
a job, fully participating in our democracy and for social cohesion.’ Minister
Tudge has previously
said that English language ability is critical for social cohesion and
successful migrant settlement, and alluded to suggestions that ‘basic
conversational English capability should be required before receiving permanent
residency’. However, a specific proposal to introduce such a requirement for
any of the family stream visas has not previously been mooted.
While complete details of this measure are not yet known,
has stated that it will apply from late 2021, and will require applicants
and their permanent resident sponsors to have functional
English or ‘demonstrate that they have made reasonable efforts to learn
English’. The partner visa program involves a two-step process by which
applicants are first granted a provisional visa, allowing them to live in
Australia while the permanent visa is processed. The English language
requirement will need to be met for the grant of a permanent visa, not for the
grant of a provisional visa. People living in Australia on a provisional
partner visa are eligible for free English language classes under the Adult
Migrant English Program (AMEP), and the Minister
has indicated that completing 500 hours of these classes will be sufficient
to demonstrate an attempt to learn English. Other ways in which this may be
demonstrated have not been articulated.
Mandating English language ability as a condition for the
grant of a permanent partner visa will require amendment to the Migration Regulations
1994, which will be subject to possible disallowance by the Senate.
Migrant groups have expressed
significant concern about
this policy, labelling it discriminatory and rejecting the argument that it
will assist migrants to settle and benefit social cohesion.
The Humanitarian Program provides permanent visas for
refugees and others in humanitarian need. In 2020–21, the planning level for
the Humanitarian Program has been reduced by 5,000 places compared to 2019–20:
from 18,750 to 13,750. This is a return to the pre-2017 program size.
The number of places available in the Humanitarian Program sat
at around 13,750 for many years, before it was gradually
increased to 16,250 in 2017–18, and 18,750 in 2018–19. This followed a commitment
made by the Government in 2014 following negotiations with the Senate
crossbench over the passage of the contentious Migration and
Maritime Powers Legislation Amendment (Resolving the Asylum Legacy Caseload)
Act 2014. The increased number of humanitarian places was formalised in
made by then Immigration Minister Scott Morrison in December 2014. This
Determination did not specify the number of places to be available beyond
2018–19. However, in 2016, then Prime Minster Malcolm Turnbull, in a speech
to a Leaders’ Summit on Refugees in New York, stated that Australia’s
Humanitarian Program would be maintained at 18,750 places ‘from 2018–19
onwards’. The program did remain at 18,750 places in 2018–19 and 2019–20, but
has now been reduced to 13,750 places.
As the report on Australia’s
Offshore Humanitarian Program: 2019–20 shows, the planning level for
2019–20 was 18,750 places. However, the number of visas actually granted was
significantly lower than that, at 13,171, due to the impacts of COVID-19—the
Government suspended the granting of offshore humanitarian visas on 19 March
2020 (p. 1). Hence, the planning figure for 2020–21 is similar to the actual
outcome for 2019–20. It is likely that COVID-19 will continue to disrupt the Humanitarian
Program in 2020–21, and the Minister has stated
that the reduced planning figure ‘reflects the global impacts of the COVID-19
pandemic which will continue to present challenges to delivery in 2020–21.’
However, the reduction in places appears to be factored into the Budget as a
permanent cut. Budget
Measures: Budget Paper No. 2: 2020–21 suggests the reduced program size,
and reforms to settlement services, will result in savings of around $958
million over the forward estimates (p. 109).
Refugee advocates have condemned
the reduction in the Humanitarian Program, arguing
that in the current climate there is need for more refugee resettlement places,
The Budget provides for $62.8 million over five years
commencing in 2019–20 for a social cohesion measure. This includes $21.5
million in the current budget year and $28 million over the forward estimates,
with the remaining $13.3 million having been spent in the 2019–20 year (Budget Paper
No. 2, p. 112).
The measure was announced on 28 August 2020 in an address
to the National Press Club by
the Acting Minister for Immigration, Citizenship, Migrant Services and
Of the total, $37.3 million is allocated over four years for
promotion of social cohesion and for countering malign information online. The
Minister’s address stated that components of the measure would include a
campaign on Australian values, national identity and multiculturalism.
Promotion of Australian citizenship and encouraging its uptake would also form
a part, with updates to the citizenship test and to the Australian Values
Statement also announced.
Enhancing engagement with multicultural communities is
allocated $17.7 million over four years. This aligns with a boost to the
Department of Home Affairs Community Liaison Officer network announced in the
The remaining $7.9 million is provided over four years to
establish a social cohesion research program, which will be at least in part
through a partnership with the Scanlon
Foundation Research Institute.
Paper No. 2 (p. 112) further notes that the costs of the measure will
be partially met from within the existing resources of the Department of Home
The address of 28 August announced changes to the AMEP, with
the key elements being to lift the cap on class hours (previously a total of
510 hours of free tuition, with some clients eligible for supplementary hours)
and remove the time limits within which clients had to enrol and complete their
program. The budget papers note that these reforms make up part of the measure,
although there are no additional allocations specifically indicated for the AMEP.
noted that the AMEP
is currently funded at $250 million per year over four years.
The Minister’s address noted that people would be eligible
to attend AMEP courses until they achieve vocational-level English (IELTS 5.5 or equivalent), beyond the
current level of functional English (IELTS 4.5 or equivalent). These reforms
will require amendments to the Immigration
(Education) Act 1971 which governs the AMEP.
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