Australia has outsourced migration policy to the private sector

The government focus on economic migration has meant increased private sector power over who becomes Australian. Kit/Flickr, CC BY-NC

Australia’s migration policy has shifted significantly in the past 20 years, leaving a system subject to widespread rorting and controversy.

If there is a single lesson to be learnt from the revelations of rorting in the 457 visa system, it is that Australia’s migration programs need to be opened up to greater scrutiny, and that government, not the private sector should drive migration policy. A dedicated low skilled work visa with appropriate labour market testing could be a step in the right direction.

How we got here

The burgeoning of Australia’s temporary migration program, with a growing focus on skilled migrants, reflects the changing focus of successive federal governments.

The first shift has seen the permanent migration program evolve from one with a focus on family and humanitarian migration to economic migration.

A second big shift has been the introduction of temporary pathways for migrants to work in Australia. In recent years, 100,000 – 135,000 temporary migrants have been admitted annually, mainly through the subclass 457 temporary visa scheme. These migrants are employer sponsored, and are entitled to work for 4 years.

Although the government determines a list of skilled occupations temporary migrants must possess to be sponsored, it is employers who determine how many migrants within any particular occupation actually enter Australia. We have written in The Conversation before about how this skilled occupation list is highly problematic as it includes occupations that are not experiencing a domestic skill shortage. This has led to an over-supply of some skilled occupations in the Australian labour market, such as cooks and accountants.

The most common pathway to permanent residency is by first entering Australia as a temporary skilled migrant, in a two-step migration process, meaning that to a large extent, who becomes Australian has been outsourced to the private sector.

Problems go beyond 457 visas

It is within the 457 visa scheme that there is alleged to be widespread rorting. Employers are alleged to have sponsored migrants to work in areas of employment on the government’s skilled occupation list, only to then employ them in much lower skilled jobs. Migrant workers who find themselves working in jobs not commensurate with their level of skill, are unlikely to complain as they are tied to their employer, and risk losing their jobs and their visa if they do.

Outside the standard sponsorship arrangements under the 457 visa, there are two limited exceptions for the employment of low and/or semi-skilled migrant workers. First, the Pacific Seasonal workers scheme facilitates the employment of Pacific workers in the horticultural industry, for which there has been a very limited take up.

Second, a labour agreements pathway facilitates the employment of workers under the 457 scheme who are not on the skilled occupation list. This scheme is underused because of an excess of regulation, with agreements taking between six to eight months to negotiate. Each agreement needs to be individually negotiated with the Department of Immigration and because the agreement has the status of a commercial contract, it is not tabled in Parliament or available for public scrutiny.

Thus, apart from the efficiency problems for employers, there are very real public transparency and accountability concerns arising from the continuing operation of the labour agreements stream.

International students compete for low-skilled jobs

In the last 10 years there has been a dramatic increase in unskilled work being done by migrants on visas dedicated to purposes other than work, namely, international students and working holiday visa holders. These visa schemes do not contain the same protections for workers on dedicated labour migration schemes.

As at 30 June, there were 160,503 working holiday makers in Australia, of whom 38,862 had taken up the option of a second working holiday visa to work in regional Australia. And there were 304,251 international student visa holders with the right to work up to 40 hours a fortnight during the course of their studies in any job in any industry in Australia.

In the 2012-13 financial year, 142,405 students stayed in Australia on other visas at the conclusion of their studies. More than a quarter of these were on new Temporary Graduate (subclass 485) visas introduced in 2013 to provide graduates with the ability to work for two years in Australia. The subclass 485 visa is not subject to labour market testing, and graduates are not required to work in the area of their studies. As a result, tens of thousands of international student graduates on these visas are competing directly with domestic graduates for entry into the labour market.

Finally, mention must be made of a new group of migrants residing in the Australian community – asylum seekers on bridging visas, who used to have the right to work legally, but no longer do as a result of a policy shift. As at 25 February 2014, there were 23,616 asylum seekers in the community on Bridging Visa Es, of whom 19,353 had no entitlement to work.

The no work condition in BVEs makes asylum seekers particularly vulnerable to exploitation in the workplace. There is a real risk that employers will prefer to illegally employ a willing and enthusiastic asylum seeker than to pay an Australian worker the minimum wage for the equivalent job.

Australia should consider a low skilled work visa

Australia’s current migration policy is unwieldy and anomalous in many ways. It does not formally acknowledge the unskilled work done by migrant workers, leaving this work under–regulated to the detriment of both migrant and local workers. The working holiday maker scheme and the international graduate students visa are having as significant an impact on the Australian labour market as the subclass 457 visa. Yet, this reality is being largely ignored by policymakers as the two former visa types are not officially for a “work” purpose.

Australia needs a more considered, coherent and transparent approach to determining how many temporary migrant workers to admit, under what conditions and for what jobs.

One way forward is to develop an explicit and formal entry pathway for low and semi skilled migrant workers. This should be subject to stringent labour market testing to ensure that the skill shortages are genuine and to ensure that local job opportunities, and apprenticeship and training programs, especially for young Australians, are not being displaced.

If there is a genuine skill shortage, then it is acceptable for this to be filled by a migrant worker but if the skill shortage would be better met through training domestic workers, then this is the more appropriate outcome.

Associate Professor Alexander Reilly and Dr Joanna Howe are Lecturers in Law and members of the Public Law and Policy Research Unit at the University of Adelaide.