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2003-04 Migration Program will increase benefits to Australia.

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2003-04 Migration Program Will Increase Benefits To Australia

MPS 18/2003

The government will build on the established Migration Program by leveraging benefits from the overseas student program and further targeting skills, the Minister for Immigration and Multicultural and Indigenous Affairs, Philip Ruddock said today.

Australia's 2003-04 Migration (non-Humanitarian) Program will remain in the range of 100,000 to 110,000 plus a parent contingency reserve. (see Attachment 1)

'As I announced last year, the program, barring exceptional circumstances, will remain at this level until 2005-06,' Mr Ruddock said

'Due to lengthy negotiations over legislation to implement the new parent visa categories which I announced on 5 March 2003, I have also decided to roll over 2,500 places from the 2002-03 parent contingency reserve into 2003-04.'

This will bring to 7,000 the total number of places available to parents in 2003-04. There will be a total of 1,500 places in the existing parent categories and 5,500 in the new contributory parent categories.

The family stream including parents will be 47,100, the biggest since 1995-96 when parent numbers were around 9,000, however families are now making a greater contribution to the support provided for


The policy changes the Government has made since the mid 1990s mean the program continues to deliver major economic and budgetary benefits.

The skill stream will increase to between 63,300 and 68,300, the highest skill stream on record.

'Our research shows the benefits of our highly skilled and targeted migration program,' Mr Ruddock said. (see Attachment 2)

'In particular, Australia continues to achieve a 'brain gain' and skill stream migrants quickly establish themselves in the labour market and apply their skills and qualifications.

'I am continuing to look at ways to help regional Australia obtain greater benefits from migration,' Mr Ruddock said.

'Last year I announced a number of possible measures to improve the dispersal of the intake to regional Australia. Most of these have been implemented.' (see Attachment 3)

General skilled migration applicants assessed on or after 1 July 2003, will gain an additional five bonus points if they have studied for a minimum of two years at an Australian university, TAFE or private education provider in regional Australia or a low population growth metropolitan centre.

'I will also be considering other initiatives, some of which are likely to flow from the Commonwealth/NSW Working Party report which Premier Carr and I have commissioned'.

A number of general changes will also take effect later this year:

• To enhance the focus on skills in demand, there will be an increase from 5 to 10, in the points awarded for general skilled migration applications assessed on or after 1 July 2003, with occupations in national demand and from 10 to 15 where they also have a job offer.

• Given the successful labour market performance of migrants with Australian qualifications, a number of measures will target the upper end of the overseas student market. o Graduating overseas students applying for general skilled

migration on or after 1 July will be required to have completed a minimum of two years study physically in Australia before they qualify for bonus points or the work experience exemption (currently only one year is

required). o The points awarded for completion of an Australian upper second Class Honours (or higher) or Masters qualification following completion of an Australian bachelor level

qualification, both obtained while studying in Australia will increase from 5 to 10.

o The points awarded for completion of an Australian Phd with a minimum of two consecutive years of full time study physically in Australia will increase from 10 to 15.

The additional points will be awarded for applications assessed on or after 1 July 2003.

These changes will further enhance Australia's competitive advantage in attracting skilled people.

Further information on the changes occurring from 1 July 2003 is available on the Department's website at

See: Attachment one: Migration (Non-Humanitarian) Program Planning Levels Attachment two: Migration Program - Key Results from Latest Research Attachment three: State Specific and Regional Migration

31 March 2003

Attachment 1 - Migration (Non-Humanitarian) Program Planning Levels

Category 2002-03 2003-04

Family Stream Spouse/Interdependency Fiance1 Child2 Parent Other3

32,700 4,800 2,700 500 2,500

30,200 5,200 2,800 500 1,900

Total Family 43,200 40,600

Skill Stream Skilled-Australian Sponsored4 Skilled Independent ENS/LA/RSMS/STNI5 Business Skills6 Distinguished Talent 1 November

10,500 32,200 9,800 8,000

170 30

11,800 33,400 10,500 7,400

200 0

Total Skilled Skill as % of Total Program

60,700 57.8%9

63,300 56.8%10

Special Eligibility 1,100 1,100

Program7 (+/- 5,000 from mid-point) 100,000-110,000 100,000-110,000

Parent Contingency Reserve8 Existing parent Contributory parent

1,000 5,500

Total Parent Contigency Reserve8


Total Program (with contigency reserve) 106,500-116,500

Note: Program numbers do not include New Zealand citizens and are detailed at the mid-point of the programs planning range. 1 Net outcome as places taken by provisional visa holders who do not subsequently obtain

permanent visas are returned to the Program in the year that the temporary visas expire. 2 Includes child-adoption, child dependent and orphan minor. 3

Includes aged dependent, carer, orphan unmarried and remaining relatives. 4 Includes brothers, sisters, nieces, nephews, non-dependent children, working age parents, grandchildren and first cousins who have been skill tested.

5 Includes Employer Nomination Scheme, Labour Agreement, Regional Sponsored Migration Scheme and State/Territory Nominated Independent Scheme. 6

Net outcome as cancelled visas are returned to the Program in that year. 7 To be maintained till 2005-06, other than in exceptional circumstances. 8

Parent legislation introducing the new Contributory Parent visa classes has passed Parliament for implementation on 1 July 2003. The 2,500 places for 2002-03 will be rolled over to 2003-04, giving a total parent contingency reserve of 6,500 places in 2003-04 - an additional 1,000 places in existing parent categories and 5,500 places for new contributory parent categories. 9

Calculated for planning level at the mid-point of the range. 10 Calculated for mid-point of the range 111,500 (including parent contingency reserve). The slight reduction in the percentage from 2002-03 is due to the addition of the parent contingency reserve to the total Program in 2003-04.

Attachment 2 - Migration Program - Key Results from Latest Research

Australia's Migration Program is delivering major benefits in the following areas:

• Enhancing our skilled labour force • Reducing the gap between higher and lower income Australians • Contributing significantly to the Commonwealth Budget: and • Adding to Australia's Gross Domestic Product (GDP)

Enhancing Australia's skilled labour force

To ensure that our workforce of the future contains the skills we need to succeed in a competitive world, we need a continuing emphasis on migrants who have the language and job skills to quickly find their feet in the Australian labour market.

The latest research from DIMIA's Longitudinal Survey of Immigrants to Australia (LSIA) demonstrates that new migrants are indeed quickly settling in and contributing to the economy of their new country.

Within 18 months of their arrival:

• new skill stream migrants are achieving labour force participation rates higher than the Australian average; and • all migrants on average are achieving participation rates nearly 10 per cent higher than those of migrants who arrived between 1993 and 1995 • migrants with Australian qualifications have a higher participation rate (90%)

than those with overseas qualifications (80%)

Within 18 months of their arrival:

• new skill stream migrants are achieving unemployment rates lower than the Australian average; • all migrants on average are achieving unemployment rates half those of migrants who arrived between 1993 and 1995.

Within 18 months of their arrival:

• new skill stream migrants are achieving weekly earnings higher than the Australian average; and • all migrants on average are achieving indexed weekly earnings 50 per cent higher than those of migrants who arrived between 1993 and 1995.

Brain gain, not brain drain

It is very important for Australia not only to gain new skilled workers through our Migration and Temporary Entry Programs, but also to keep them, especially at a time of globalisation and rapid growth in the international movement of skilled people.

New research from Dr Bob Birrell of Monash University shows quite clearly that Australia continues to enjoy a substantial "brain gain". Dr Birrell has shown that:

• In 2001-02 we gained a total of 29,380 (net) skilled and professional workers. This was the result of a net long term and permanent loss of 29,990 skilled Australian residents, countered by a net gain of 59,370 long term and permanent skilled arrivals.

Of the total net gain of skilled people in 2001-02:

• About 80 per cent were managers or professionals. The remaining 20 per cent were skilled tradespersons and associate professionals • There was an encouraging increase in the number of nurses we were able to attract in 2001-02, with the net gain jumping to 1,094 from 697 in the

previous year.

The benefits of skilled immigration for unskilled Australians

It is clear that skilled migration increases Australia's Gross Domestic Product (GDP) and the budgets of both the Commonwealth and States and Territory governments. But are the gains of skilled immigration shared equitably with less skilled Australians? In 2002-03 DIMIA contracted Professor Ross Garnaut to examine this issue.

Professor Garnaut's first finding is that the proportion of migrants to Australia with less than year 12 education has fallen greatly in recent years, from around 55 per cent in 1980 to 12 per cent in 1999-00. In the USA, where the trend has been in the other direction, much of the widening wage gap between unskilled and skilled workers has been attributed to the high proportion of unskilled immigrants to that country.

Professor Garnaut found that lower income earners in Australia benefit from skilled immigration in four ways:

• Skilled immigration makes Australia's economy more efficient, lowering the cost of a number of important goods; • Young skilled migrants increase government revenues, which in Australia tends to redistribute income from relatively rich to relatively poor Australians

through the budget process;

• Increased revenues are also used to expand the supply of public goods and other areas of socially beneficial public expenditure. • Unlike in the USA, Australia's emphasis on skilled immigration does not put pressure on the wages of lower skilled Australians.

* Information in this paper is based on research in progress by Professor Sue Richardson, National Institute of Labour Studies, Dr Bob Birrell, Monash University, and Professor Ross Garnaut, ANU. Further research into the fiscal and economic benefits of migration

is also being conducted by Econtech and Access Economics.

Attachment 3 - State Specific and Regional Migration

The Government's regional migration initiatives have met with considerable success to date. By this June we will have influenced the location decision of 22,000 migrants over the past seven years through our efforts to improve the dispersal of migrants and to meet skill shortages in regional areas.

State specific and regional migration initiatives have been progressively improved over the same time in close consultation with State and Territory Governments and regional authorities. There is always room to do more.

When I announced the 2002-03 Migration Program on 7 May 2003, I referred to a package of possible enhancements to our regional initiatives to enable an even higher number of skilled and business migrants to settle in regional Australia.

Wide consultation on the enhancements has subsequently occurred with State and Territory Governments and other interest groups including an external reference group of regional representatives and another external reference group on business migration.

A number of the possible enhancements I announced have been implemented. These include measures to increase the number of potential skilled migrants on the Skill Matching Database (SMD) that is currently used by employers, Regional Certifying Bodies (RCB) and State and Territory governments. To date these enhancements have had a significant impact, resulting in a three-fold increase in numbers on the SMD.

The increased use of labour agreements is being encouraged to enable peak industries to fill regional labour shortages.

From I July 2002 the potential length of temporary residence visas for doctors in 'areas of need' has been extended for up to four years. Visa numbers in this category continue to grow strongly and reached 3,888 in 2001-02 and are likely to exceed this level in 2002-03.

Final consultations with State/Territory Health Ministers are currently taking place regarding special sponsorship and nomination arrangements. This proposal involves special sponsorship/nomination arrangements for the Regional Sponsored Migration Scheme and the temporary Medical Practitioner visa for professional health workers. It allows for sponsorship by the community, such as the local council, regional health organisation or regional medical centre.

I have also introduced changes to the long-term temporary business category to allow RCBs a greater role to support sponsorships in regional Australia. From 1 November 2002 the skill and salary threshold requirements for Temporary Business (Long Stay) (subclass 457) nominations can be waived in exceptional cases. Waiver of these thresholds requires RCB certification that the position in a regional area is necessary to

the operations of the business and cannot reasonably be filled from the local labour market.

From 1 March 2003 I have introduced a two-stage process (ie a provisional visa and then the granting of permanent residence once a business is fully established) for the Business Skills categories. This new arrangement has a much greater emphasis on State and Territory Government sponsorship and support at both stages. Immediate permanent residence is only available for high calibre business migrants who have State/Territory Government support.

My Department continues work in partnership with State/Territory Government agencies, local government and regional development agencies to improve awareness raising and assistance in using State specific and regional migration initiatives.

Adjustments to the bonus points regime for overseas students applying to migrate will be introduced from 1 July 2003. The objective is to encourage a greater proportion of students to consider studying at and eventually settling in regional Australia. Key aspects of this proposal are:

• providing additional bonus points for overseas students who have recently completed their qualifications by studying and living nearby for a period of at least 2 years at the campus of an Australian university, TAFE or private education provider in regional Australia or a low population growth metropolitan centre, and

• increasing the period of time students are required to attend a tertiary institution in Australia to be exempt from the work experience requirement from 12 months to 2 years.

Regional Australia is defined for these purposes as any Statistical Division with a population of less than 200,000. In addition, a low population growth metropolitan centre for these purposes is one with a population growth rate between the last two censuses of less than 50 per cent of the national average.

The Premier of NSW and I have established a joint Commonwealth/NSW Working Party on Migration to Sydney and Regional NSW. The Working Party is preparing a report on options to divert the level of skilled and business migration from Sydney to regional NSW and reduce the level of temporary and permanent migration to Sydney. Further initiatives are likely to flow from this report. Announcements on any further initiatives will be made in due course.