Immigration

Budget Review October 2022–23 Index

Susan Love

Immigration-related measures in the Budget October 2022–23 generally implement Australian Labor Party (ALP) election commitments and announcements from the new Government since the May 2022 election, in particular stemming from the Jobs and Skills Summit in September.

Migration Program

At the Jobs and Skills summit in September 2022, the Government announced an increase in the permanent Migration Program to 195,000 places for 2022–23, up from 160,000 places set in the March 2022–23 Budget. The detailed breakdown of allocations to visa categories was released with the Budget and is available on the Department of Home Affairs webpage on Migration Program planning levels. The revised planning levels are shown in Table 1, along with the planning levels from the March 2022–23 Budget and the 2021–22 planning levels and outcome of places granted.

Table 1 Migration Program planning levels, 2021–22 and 2022–23

Visa category	2021–22 Budget	2021–22 outcome	2022–23 March Budget	2022–23 October Budget
Skill stream
Employer Sponsored	22,000	26,103	30,000	35,000
Skilled Independent	6,500	5,864	16,652	32,100
Skilled Regional	11,200	18,223	25,000	34,000
State/Territory Nominated	11,200	19,376	20,000	31,000
Business Innovation and Investment Program	13,500	10,496	9,500	5,000
Global Talent	15,000	8,776	8,448	5,000
Distinguished Talent	200	225	300	300
Skill total	79,600	89,063	109,900	142,400
Family stream
Partner	72,300	46,288	40,500	40,500
Parent	4,500	4,500	6,000	8,500
Child	3,000	3,006	3,000	3,000
Other Family	500	500	500	500
Family total	77,300	51,288	50,000	52,500
Special Eligibility	100	199	100	100
Total Migration Program	160,000	143,556	160,000	195,000

Source: Department of Home Affairs, Migration Program planning levels webpage; Department of Home Affairs, 2021–22 Annual Report, (Canberra: Department of Home Affairs, 2022), 98.

Note that Child and Partner visa places are now ‘demand driven’ (that is, not capped), but they are still counted in the overall program for planning purposes.

Most of the extra 35,000 places have been added to the Skill stream, and within this to the ‘Skilled Independent’, ‘Skilled Regional’ and ‘State/Territory Nominated’ categories, with some extra places for the ‘Employer Sponsored’ category as well. Places in the ‘Business Innovation and Investment’ and ‘Global Talent’ programs have been wound back, compared with both the March 2022–23 Budget and the 2021–22 planning levels.

Budget measures: budget paper no. 2: October 2022–23 states that ‘Priority will be given to offshore applicants and on-hand applications for the Skilled Independent visa – New Zealand stream’ (p. 7). Some observers have argued that prioritising visas for people outside Australia is unfair to those already in Australia on temporary visas who may have been waiting for long periods for their permanent application to be decided. Home Affairs Minister Clare O’Neil had earlier stated that the change in focus was to address the backlog of offshore applications and assist in filling skills shortages.

The New Zealand stream provides a pathway to permanent residence to eligible New Zealand citizens in Australia on temporary Special Category (subclass 444) visas (see the Parliamentary Library’s quick guide New Zealanders in Australia for further background). Detailed visa data is not yet available for 2021–22, but in 2020–21, a high proportion of places in the Skilled Independent category went to the New Zealand stream: 3,319 out of the total 7,213 places granted (Home Affairs data on data.gov.au). The higher 2022–23 planning figure of 32,100 may help ‘make more room’ for other nationalities.

There is also a Hong Kong stream of the Skilled Independent visa. This was announced in November 2021 as part of a pathway to permanent residence for eligible Hong Kong nationals wishing to stay in Australia due to the security situation in Hong Kong. It opened for applications in March 2022, so its impact on the category is not yet apparent.

In the Family stream of the Migration Program, 2,500 extra places have been allocated to Parent visas. Regarding the drop in the number of Partner visa places compared with the 2021–22 planning level, the Department of Home Affairs 2021–22 Annual report notes that 10,000 Family stream places (Partner visas) were reallocated to the Skill stream (p. 99). This reallocation was noted in the March Budget measures: budget paper no. 2: 2022–23 as being due to a ‘sharp fall’ in the number of on-hand applications for Partner visas (p. 11; see also the Library’s March Budget review 2022–23 article ‘Immigration’).

Pacific Engagement Visa

The Pacific Engagement Visa was announced as an election commitment in Labor’s plan to build a stronger Pacific family. This document stated that the initiative would ‘have no budget impact as the new migration places will come from within the existing migration program’. However, the Pacific Engagement Visa measure in Budget paper no. 2 (p. 150) provides $175.1 million over 4 years from 2022–23 (and $80.3 million per year ongoing from 2026–27), with the 3,000 annual permanent migration places to be in addition to the Migration Program planning level. The measure is forecast to increase tax revenue by $55 million over the forward estimates.

This new visa, to commence in July 2023, will be a significant shift within existing Australian visa settings for a number of reasons:

Few visas, particularly permanent visas, are targeted at specific nationalities (the specific streams of the Skilled Independent visa noted above being an exception). The Pacific Engagement Visa will be open to citizens of Pacific Island countries and Timor-Leste.
While applicants will need to have a job offer, it appears the visa eligibility criteria will not include skill-level or occupation requirements.
There will be a ballot system to select applicants each year, which is similar to the New Zealand Pacific Access Category, on which the new visa is modelled.

The program is therefore not primarily intended to fill labour market gaps (though participation via a job offer is evidently a key element), but aims to ‘build our people-to-people links’, as stated in August by the Minister for International Development and the Pacific, Pat Conroy. Considering the creation of ‘a dedicated Pacific component within Australia’s permanent migration intake’ was a recommendation of the Joint Standing Committee on Foreign Affairs, Defence and Trade’s report on Strengthening Australia’s relationships in the Pacific (p. 99). Observers, including the Development Policy Centre at the Australian National University, have noted the program announcement’s positive reception and analysed some of the implications for migration and international relations.

Additional measures responding to election commitments and previous announcements

The Additional Assistance to Ukraine measure provides $0.6 million for the Ukrainian Community and Settlement Support Program for the 2022–23 year (Budget paper no. 2, p. 85), in addition to the $0.5 million for the 2021–22 year provided in the March 2022–23 Budget (March Budget measures: budget paper no. 2: 2022–23, p. 70). The measure also provides new funding of $18.4 million over 4 years from 2022–23 for Temporary Humanitarian Concern (subclass 786) visas for Ukrainians, and provides access to Medicare for Ukrainians and immediate family members holding a Bridging Visa E. While the granting of Temporary Humanitarian Concern visas to Ukrainians was mentioned in the March 2022–23 Budget, no funding was allocated at that point (noting that the Russian invasion of Ukraine began on 24 February 2022).

The cross-portfolio measure on outcomes of the Jobs and Skills Summit includes $42.2 million over 2 years from 2022–23 for the Department of Home Affairs (Budget paper no. 2, p. 82). Of this, $36.1 million was announced at the Jobs and Skills Summit to recruit 500 new staff to increase visa processing capacity. A media release from Home Affairs Minister Clare O’Neil on 25 October 2022 stated that an additional $6.2 million was allocated for ‘outreach and communications, including an international marketing campaign to promote migration to Australia’.

The media release from the Jobs and Skills Summit also announced a review of the migration system, to report by February 2023 (also highlighted in the Summit Outcomes document, p. 4). Budget strategy and outlook: budget paper no. 1: October 2022–23 describes the review as a ‘Migration Strategy’ that would:

identify reforms required to ensure the migration system serves Australia’s national interests and complements the skills and capabilities of Australian workers. The Strategy will focus on ways to grow Australia’s economy and attract high-skilled migrants, while also furthering Australia’s geostrategic interests, unlocking the potential of all migrants and providing clear pathways to permanent residency. (p. 14)

No funding is allocated in the Budget for the review.

The Home Affairs portfolio measures also include confirmation of the following funding as per the ALP’s election commitment costings (Labor’s plan for a better future, p. 9):

$20 million over 4 years from 2022–23 for the Adult Migrant English Program
$1 million over 2 years from 2022–23 for a review of multicultural policy settings (‘a Government that Works for Multicultural Australia’).

The election commitments regarding Expanding the Pacific Labour Scheme and Reforming the Seasonal Worker Program (Labor’s plan for a better future, p. 13) were reconfigured following the Coalition Government’s move to combine the 2 programs into the new Pacific Australia Labour Mobility (PALM) scheme. The budget measure Enhancing the Pacific Australia Labour Mobility Scheme (Budget paper no. 2, pp. 111–112) provides $67.5 million over 4 years from 2022–23 (and $12.4 million per year ongoing from 2025–26) to meet the adjusted commitments outlined in the PALM policy.

Budget paper no. 2 states that savings identified from previous budget measures have been redirected to other initiatives, including the PALM scheme (p. 113). One of these previous measures is the Australian Agriculture Visa measure in the Mid-year economic and fiscal outlook 2021–22 (p. 231), which provides a redirected amount of $90.4 million over 5 years. Relocating the Australian Agriculture Visa into the PALM scheme (and not pursuing further arrangements under it) was also a commitment of Labor’s plan to build a stronger Pacific family.

Commitments yet to be fulfilled

Apart from the measures for the PALM scheme and visas for Ukrainians noted above, there are no measures directly related to temporary visas or refugee and humanitarian programs. Perhaps the main item in migration-related election commitments not addressed in the Budget is the policy to abolish Temporary Protection and Safe Haven Enterprise visas, which was costed at $407 million over 4 years from 2022–23 (Labor’s plan for a better future, p. 9). Advocacy groups, members of the crossbench and think tanks have been pressing the Government to act on the commitment.

The Minister for Immigration, Citizenship and Multicultural Affairs, Andrew Giles, has recommitted to the policy, including via Twitter on 6 September 2022, stating ‘we will keep this promise and meet our commitment as soon as possible’.

Another policy costed in the election commitments, but not reflected in the Budget, was increasing the Temporary Skilled Migration Income Threshold (Labor’s plan for a better future, p. 9). This proposal is identified in the Jobs and Skills Summit Outcomes document as one of the ‘areas for further work’ (p. 4) along with other initiatives broadly in line with the ALP’s 2021 National Platform, such as addressing migrant worker exploitation and expanding pathways to permanent residence for certain temporary migrant workers.

Net overseas migration and post-pandemic recovery

The revised assumptions used in the budget papers foresee migration returning to pre-pandemic levels more quickly than envisioned in earlier budgets. The forecasts in Table 2 below are produced by the Centre for Population within the Treasury, and show that net overseas migration (NOM) is set to reach 235,000 in the current year (instead of 2024–25 as indicated in the March 2022–23 Budget) and continue through the forward estimates.

Table 2 Net overseas migration, for years ending 30 June

Net overseas migration	2018–19	2019–20	2020–21	2021–22	2022–23	2023–24	2024–25	2025–26
2020–21 Budget (October)	239,700	154,100	-71,600	-21,600	95,900	201,100
2021–22 Budget (May)		194,400	-96,600	-77,400	95,900	201,100	235,000
2022–23 Budget (March)			-89,900	41,000	180,000	213,000	235,000	235,000
2022–23 Budget (October)			-85,000	150,000	235,000	235,000	235,000	235,000

Source: Australian Government, Federal Financial Relations: Budget Paper no. 3, Table A.5, various years: 2020–21 (p. 86); 2021–22 (p. 104); 2022–23 (p. 114); October 2022–23 (p. 108).

NOM is the difference between arrivals to Australia and departures from Australia. Migrant arrivals to Australia are counted in NOM if they are in Australia for a total of 12 months or more during a 16-month period. This parameter is not the same as overseas arrivals to Australia or the number of places available in the permanent Migration Program; however, arrivals and migration planning levels may influence NOM in different ways.

Data from the Australian Bureau of Statistics (ABS) indicates that although arrivals in September 2022 were still well below the pre-pandemic levels (just over 1 million, compared with over 1.7 million in September 2019), the levels have increased substantially since the re-opening of borders in February 2022 (ABS, Overseas arrivals and departures, Australia, August 2022, graphs 1.1 and 1.3).

Population growth is also forecast to be higher than indicated in the March 2022–23 Budget: 1.1% in 2021–22 and 1.4% in 2022–23 and 2023–24, instead of 0.7% in 2021–22, 1.2% in 2022–23 and 1.3% in 2023–24 (Budget strategy and outlook: budget paper no. 1: 2022–23, p. 37; Budget strategy and outlook: budget paper no. 1: October 2022–23, p. 47).

Migration is one of the Budget’s key receipts measures: increasing the Migration Program by 35,000 places in 2022–23 is estimated to increase receipts by $935 million over 4 years from 2022–23 (largely through higher personal income tax receipts), while payments (including for migrant services) will increase by $487.2 million (Budget paper no. 1, pp. 89; 155). It is not explicitly stated whether the Government intends to maintain the Migration Program at the higher level of 195,000 places in future years. See also pages 66–67 of Budget paper no. 1 for more detail on the role of migration and population in GDP and medium-term economic projections.

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