Australia: Tighter Immigration Rules On The Way?

Expat Briefing Editorial Team, 20 January, 2014

Australian Prime Minister Tony Abbott came to power in September promising to strengthen Australia's porous borders against illegal immigration like never before. But what about the new government's attitude to immigration of the legal kind?

Like the United States, Australia's modern history is built on a foundation of immigration, and a steady influx of migrants seeking a better life in the aftermath of the Second World War and beyond helped to transform the country into one of the world's wealthiest nations.

It remains the case that Australia is among the top-tier of countries for those seeking to better themselves both financially and in terms of their overall quality of life. Australia's favourable climate, allowing people to pursue an "outdoors" type of lifestyle, means that the country is usually rated highly in the expat opinion polls as a place to raise a family. But its cities are also among the most desirable expat destinations in the world. Indeed, according to a survey from the Economist Intelligence Unit, Melbourne remains the world's most liveable city and three other Australian cities are among the top ten, including Adelaide, Sydney and Perth.

Figures attest to Australia's pull within the global migrant community. According to the Australian Bureau of Statistics, over one quarter of Australia's population of 22m were born overseas. More than 158,000 migrants arrived in Australia between July 2008 and June 2009 from over 200 countries with most originating from New Zealand, the United Kingdom, India China, and South Africa. And on September 17, 2013, 2,500 new Australian citizens from 92 countries took part in Australian Citizenship Day celebrations around the country.

This isn't to say that Australia utilizes an "open door" policy on immigration. Far from it. The visa system is set up so that skilled workers and/or those better able to support themselves have a much better chance of getting in than the unskilled or those expected to contribute little to the Australian economy.

Still, immigration has become a sensitive political issue that tends to polarise opinion among the Australian public. There is a growing feeling that the country's infrastructure is struggling to cope with the ongoing influx of migrants, and the age-old fear that foreigners are taking Australians' existing jobs rather than filling new vacancies is never far from the surface. Add to this the fact that the country has become a magnet for the poverty stricken and persecuted of South East Asia, who are arriving on an almost daily basis by boat seeking economic betterment or political asylum, and the whole immigration issue quickly turns toxic.

Abbott's government has reacted strongly to the illegal immigration issue by more or less turning the policing of Australia's borders over to the military. Thankfully, the new administration is content to leave the handling of immigration through normal channels to the civilian authorities! However, there are indications that the government wishes to tighten up a few things.

Immigration Policy – 457 Visa Rules Tightened

In October 2013, Australia's Immigration Minister Scott Morrison highlighted the Government's support for skilled migration into the country, although he warned that those who abuse the visa system would see a "tough" response comparable to the way that the Government deals with people-smuggling.

Speaking at the Migration Institute of Australia, Morrison explained that the Government would never accuse migrants of taking Australian jobs, and that the 457 skilled migrant scheme was a "vital asset for the Australian economy." However, he added that its misuse would "diminish" its value for Australia, and he called on businesses to help prevent this from happening.

The 457 temporary work visa allows approved businesses in Australia to employ a skilled worker from overseas for up to four years, so long as the required role cannot be filled by an Australian national. A recently study by the Migration Council Australia found that four out of five companies were using the opportunity to provide training and development for Australian workers.

Subsequent to Morrison's speech, the government has amended the 457 visa scheme with the introduction of a labour market testing requirement for employers, although the legislation includes a number of exemptions.

The requirement relates to mainly technical and trade occupations that are eligible for sponsorship under the program. Employers who wish to sponsor a visa will have to take steps to see if a position can first be filled by an Australian citizen or permanent resident, and to provide details if the position follows a redundancy or retrenchment within the employer's organization. The legislation also encourages record-keeping as regards the labor market testing, although this has not been made mandatory.

The main exclusion is for occupations equivalent to Skill Levels 1 and 2 as defined by the Australian and New Zealand Standard Classification of Occupations system. This means that most management and professional occupations will not be affected, although nurses and engineers are among the list of occupations for which testing is now required.

There is also an exemption for cases where labor market testing would conflict with Australia's international trade obligations. This applies where an applicant is a citizen of Chile or Thailand, or a citizen or permanent resident of New Zealand; where an applicant is already an employee for an associated entity in Chile, New Zealand or in an ASEAN country, or has been working full time for the nominating business for the previous 2 years; and where a business is operating in a WTO member country and seeking to sponsor senior management staff to work in Australia.

In general however, the government intends to monitor the 457 scheme much more closely. As Morrison explained: "The Coalition has always approached this issue from the perspective that Australia's migration programme is intended as a supplement, not a substitute, to the Australian workforce and there are particular challenges at the moment with changes in the resources sector and the level of peak employment that's been experienced there and in other parts of the construction sector where people who were working in those roles are returning to their suburbs and communities around Australia and are seeking employment back in those places. Many of those jobs when they were away working somewhere else would have been taken up by others who may have accessed this programme. So that is an environment we need to be very, very conscious of and the government is sensitive to those issues out in the community as we speak. That's why the 457 programme has to be managed carefully and sensitively with integrity."


Morrison also complained in his speech about the misuse of student visas as a "backdoor to permanent migration," although the current government appears to be extending the policy of visa streamlining for students introduced under the previous Labor administration.

In October 2013, it was announced by the Immigration Department that overseas students planning to study at a non-university higher education institution in Australia may benefit from plans to extend streamlined visa processing from March 2014.

In place since 2012, visa streamlining for overseas university students designates visa applicants with a Confirmation of Enrollment as being a lower immigration risk regardless of country of origin, meaning that applications are processed more quickly, and that in most cases less documentary evidence is required. To benefit from streamlining, visa applicants must be enrolled either for a bachelor, masters or doctoral degree, or be taking part in an eligible exchange program. Those enrolled on package courses must take their preliminary courses at the participating non-university provider, or with a nominated educational business partner.

To be eligible for the extended scheme, an education provider must be registered on the Commonwealth Register of Institutions and Courses for Overseas Students, and be designated as "low risk" for immigration. "Low risk" status will be determined by data relating to student visa refusals (including fraud), visa compliance, and details of actual students. The provider must also have had least 100 students with active student visas during 2012-13. All applicants will still need to meet requirements relating to health and health insurance, character, and English-language proficiency, and be able to support themselves financially for the course of their studies.

However, while studying in Australia might be a popular route towards eventual long-term residency there, it certainly isn't the cheapest way to get into the country! Analysis by HSBC has shown that Australia is the most expensive location for overseas students, with fees and living expenses amounting on average to USD38,000 – six times the USD6,285 paid by foreign students living in Germany.

Investor Visas

A major immigration priority of the new government is attracting foreign entrepreneurs intending to start a business and create jobs in Australia, and Immigration Minister Morrison has made clear his wish to "reboot" improvements to the ‘Significant Investor' visa introduced under Labor in 2012.

Although the Liberal/National Coalition wholeheartedly supported Labor's idea for the Significant Investor visa, also known as the ‘888' visa, it has suffered from implementation problems and there is now a considerable backlog of applications awaiting approval.

Under the current rules, investors must invest at least AUD5m (GBP2.7m) in an approved investment fund. If approved, they will be eligible for a Business Innovation and Investment (Provisional) (Subclass 188) visa which lasts for four years. Providing that the investors spend at least 160 days in Australia over that four year period and maintain their investment in the approved fund, they will be able to apply for a Significant Investor permanent resident visa (subclass 888).

Introduced in November that year, the first visa under the new scheme was only granted in May 2013. Up to that time, there had been 435 expressions of interest for the visa, with 279 people invited to apply and 171 primary applications were lodged. However, by November 2013, only 28 such visas had been granted.

"Potentially the scheme could and should and I still think can attract millions if not billions of overseas capital investment into projects that will stimulate our economy and create jobs and capital for hundreds of Australians and many small businesses," said Morrison in his Migration Institute speech. "But where commitment and delivery were critical to get this programme up and running to send a positive message to potential investors and participants in the programme, the implementation simply fell away."

"Effectively what I'm saying is the programme needs to be rebooted," he continued. "We need to get it back and ensure the processes are right and the criteria is as it should be and that is the work we are going through at the moment."

Morrison revealed that the government intends to review the investment criteria for the programme, with a view to having a more flexible approach that could see more of the investment capital attracted under the programme being available to more small- and medium-sized businesses including entrepreneurial start-ups.

Additionally, the residence requirements for the secondary applicants and family members of the principal applicant will be examined, Morrison explained, "because we're looking to see that family anchor themselves here in Australia."


So, judging by its actions so far, the new government intends to manage immigration more tightly than the previous government, with a preference given to those with skills or money to invest in the Australian economy. We can see this from Morrison's comments on the 457 and 888 programmes and the introduction of labour market testing. It remains to be seen whether the government has more radical changes up its sleeve, but by and large, the door looks like remaining open for skilled workers and investors.

An overview of Australia's immigration and residence rules can be found in the Australia Country Section of Expat Briefing.

Tags: business | interest | Immigration | Students | Work | Study | Invest | Africa | Immigration | investment | New Zealand | United States | Chile | South Africa | Australia | Thailand | United Kingdom | legislation | environment | education | fees | trade |


Features Archive