Minister for Home Affairs Clare O’Neil delivered an address to the National Press Club on 27 April 2023 to outline planned reform of Australia’s migration system.

She proposed three new pathways for temporary skilled workers to come to Australia as follows:

• Pathway 1: a pathway for highly specialised skilled workers to drive innovation in the economy, and to help build the jobs of the future;
• Pathway 2: a mainstream temporary skilled pathway to bring in the core skills needed;
• Pathway 3: a pathway for workers in essential industries such as aged care.

We have outlined below some of key points of her address.

TSMIT increase: The Temporary Skilled Migration Income Threshold (TSMIT) for employer-sponsored visas which has been frozen since July 2013 will increase from $53,900 to $70,000 as of 1 July 2023. Minister O’Neil stated that $70,000 is the threshold that the TSMIT would be today if it had not been frozen for the last 10 years;

Changes to the points-test: The points-test will be re-designed. The Australian Government believes the current points-test is not working properly. Minister O’Neil indicated the current bar is set too low, and that the points test rewards persistence rather than the skills we need for Australia’s future;

Student visa cohort: The Australian Government believes that current student visa requirements are a low bar and intends to tighten requirements for prospective international students, to ensure that students who are in Australia are actually here to study. There will be faster and less complicated pathways for high performing international students with skills and capabilities that are needed in Australia;

Occupation lists: The Labor Government intends to move away from rigid occupation lists and have a broader description of skill needs. Minister O’Neil gave examples of the care industry and the tech, engineering and construction sectors. She stated that rather than the Minister deciding what are the skills shortages in the economy, she wants a data driven approach and to take this out of the realm of politics where it does not belong;

Increased pathways to permanent residency: Minister O’Neil indicated that all skilled temporary workers will have a pathway to permanent residency by the end of 2023, and that the Australian Government wishes to increase competition for permanent resident places.

Skill shortages: Jobs and Skills Australia (JSA) will be given a formal role, with input from business and unions. JSA will look at evidence of where labour shortages exist and help the government to properly integrate the needs in our jobs market, our training and education system and our migration system in order to have a cohesive approach to dealing with skill shortages.

Federal and state/territory collaboration: There will be much closer collaboration between the Federal Government and the states and territories to ensure that they can better plan for housing and infrastructure, provide proper support to new migrants and achieve the right outcome for migrants and Australians;

BIIP: Minister O’Neil noted that the Government haven’t said that they will abolish the Business Innovation and Investment (BIIP) visas at this stage, but indicated the program needs a radical restructure.

Minister O’Neil noted that the purpose of the reforms is to ensure that the government has the right policy settings in place and that Australia has the skills needed to meet national challenges. She indicated that the focus is not about having a bigger migration program, and she anticipated that it would most likely be a slightly smaller migration program over time.

Subsequent to her address to the National Press Club, Home Affairs Minister Clare O’Neil released the draft outline of the government’s migration strategy.

Draft Migration Strategy

The draft strategy asserts the need to deliver structural reform so that our migration system can play a part in helping manage national challenges including an aging population, declining productivity growth and a complex geostrategic environment.

In addition to what was mentioned in the Minister’s address to the National Press Club, the draft migration strategy also mentions the following proposed changes:

• Reshaping of the Global Talent and Business Innovation & Investment Program visas and creating a simple pathway for migrants who are needed to drive innovation in the economy;
• Simplifying the visa system and making the system more efficient;
• Measures to even up the playing field for small business by exploring a switch to monthly employer fees and charges, rather than a large up-front investment to sponsor a worker;
• Formalising feedback between the migration system and the training and education system, to ensure that skill shortages are addressed in a comprehensive manner;
• Reforming policy settings that contribute to exploitation, including by improving the ability of temporary workers to change employers and enforce their workplace rights, without jeopardising their ability to stay in Australia;
• Improving and streamlining skills recognition to enable more migrants, including secondary visa holders to work in the labour market at a level that is commensurate with their qualifications.

Minister O’Neil indicated that one of the big untapped levers is the capacity of partners of skilled migrants to contribute to the economy. Data suggested that secondary visa holders are not engaging with the labour market to the degree that their qualifications suggest they could, due to the very cumbersome process of having their overseas qualifications recognised.

The Australian Government will consult state and territory governments and key stakeholders including business, unions and civil society from May-June 2023 on its draft migration strategy. It intends to release its final migration strategy later in 2023.