What does the Federal Budget mean for immigration in Australia?
More jobs, more growth – those were some of the key themes of this year’s Federal Budget as the nation continues the transition away from the mining boom into a more diverse economy.
The Budget Paper for the Department of Immigration and Border Control provides some positive signals for business.
The government has announced reforms to the visa and migration framework, such as improvements to automation in visa processing, offering self-service options and use of more sophisticated assessment capabilities in order to save the Government $180 million over three years from 2017-18. There are associated reductions in Department of Immigration and Border Patrol staffing forecast (from 13,750 to 13,445 in 2016-17). It is stated that these savings will be fed back into other policy priorities.
Whilst these improvements towards greater efficiency sound positive, it remains to be seen whether the efficiencies will create a better service experience for the user of the system. The efficiencies should help to reduce processing times and ensure appropriate allocation of staff resources for effective decision making.
The Government has stated that the total income of the Department of Immigration and Border Patrol will increase by $740.8 million to $17,486.7 million. Revenue from visa fees will increase by $79.4 million to a total of $2,027.7 million.
Revenue raising initiatives include:
- Revenue from visa application fees is expected to increase to $2,027.7 million in 2016-17, an increase of $79.4 million (or 4.07%) over the 2015-16 estimate. “The increase is primarily due to the expected growth in visa applications” – meaning we can expect to see more migration to Australia.
- Tourist Visas will increase revenue by $1.5 million from 2016-2020 by introducing trial visa arrangements in key markets. This includes a visa fast-track service for nationals from India and the UAE, and a three-year multiple entry visa for low immigration risk nationals from India, Thailand, Vietnam and Chile.
- Increase in customs duty of $580.6 million (up 4.32% to a total of $14,009.2 million compared to 2015-16). While Free Trade Agreements (FTAs) decrease duty revenue, the net increase is attributable to the Tobacco Excise announced in this Budget, and the shift from domestic production of tobacco products to overseas imports.
- Removal of the tax-free income threshold on income earned by backpackers. Backpackers will pay 32.5 cents in every dollar earned in Australia from 1 July 2016.
- Increases to the cost of an Australian passport by $20 to $274 raising $173 million over four years. This change commences 1 January 2017. The fee for priority processing of passport applications will increase by $54 to $181.
Further opportunities will open up through existing free trade agreements “that are already delivering new jobs and markets for Australian producers, manufacturers and service providers right across the country”. These agreements provide opportunities for greater mobility of labour to support tourism, business and large projects.
The Budget is otherwise silent on the changes we can expect to see to Australia’s immigration program as part of the National Innovation Agenda announced in December 2015. The Innovation Statement included measures to support innovation and entrepreneurship with a special class of visa for entrepreneurs and permanent residence pathways for researchers and graduates in STEM subjects from the Australian education system. Innovation and entrepreneurship need to be considered in a global context, as other countries are increasingly focussed on attracting new businesses and ensuring an adequate supply of STEM skills. Other countries a source of not only competition for skills, but also supply. As Australia moves to develop a national innovation and entreprenuership strategy, sound immigration policies need to be implemented.
Download a copy of our Immigration Briefing – Federal Budget 2016-17 here: