Budget Review 2020–21 Index

Dr Susan Love and Harriet Spinks

Net Overseas Migration

Net Overseas Migration (NOM) forecasts are a component of the assumptions used in the Budget. The forecasts in the Table below are produced by the Centre for Population within the Treasury.

Table: Net overseas migration, for years ending 30 June

Source: Australian Government, Federal financial relations: budget paper no. 3: 2020–21, Table A.5 p. 86.

NOM is the difference between migrant arrivals in Australia and migrant departures from Australia. Migrant arrivals in Australia are counted in NOM if they are in Australia for a total of 12 months or more during a 16-month period. Migrant arrivals include Australian citizens or permanent residents returning to Australia after a period residing overseas, permanent visa holders, and temporary visa holders who reside in Australia for at least 12 out of 16 months. Migrant departures include visa holders returning to their home countries after a period of residence in Australia, and Australian citizens leaving Australia to reside overseas. NOM affects population growth, which is in turn one of the drivers of economic growth. Population growth is expected to slow from 1.2 per cent in 2019–20 to 0.2 per cent in 2020–21 and 0.4 per cent in 2021–22—the lowest growth in over a hundred years (Budget Strategy and Outlook: Budget Paper No. 1: 2020–21, p. 2-13).

Budget Paper no. 1 sets out assumptions on the return of international travel, beginning with small pilot programs of international student arrivals from the end of 2020 and a gradual resumption of permanent migration in the second half of 2021 (p. 2-6). It also notes possible alternative scenarios, including ‘downside scenarios’ where the opening of international borders is delayed due to further outbreaks of COVID-19, and ‘upside scenarios’ where an early vaccine and successful pilots of international student arrivals could lead to more rapid recovery (p. 2-15).

Actual NOM is calculated by the Australian Bureau of Statistics (ABS). The latest annual figures are for 2018–19. The latest quarterly estimates are as at 31 March 2020. In the twelve months to that date, NOM was 220,500, down by 12 per cent on the previous year but still contributing 61.8 per cent of Australia's annual population growth. The decline was due to an increase in departures, in part because of the impacts of COVID-19, but this reflects only the early stages of international travel restrictions. Australia closed its borders on 20 March 2020, tightly restricting both arrivals and departures. The impact on international travel is presented in the ABS Overseas Arrivals and Departures dataset.

ABS and Home Affairs reports show that in recent years, NOM has been driven mainly by temporary visa holders—they formed 64.3 per cent of overseas migrant arrivals in 2018–19. (Many temporary visa holders leave Australia in future years—52.8 per cent of migrant departures in 2018–19 were temporary visa holders.) The largest category of temporary visa holders making up NOM is international students: 173,000 in 2018­–19, forming 32.2 per cent of all migrant arrivals.

Permanent visa holders, that is, those arriving from overseas counted within the Migration Program, made up only 15.4 per cent of NOM in 2018–19. Permanent visas may also be granted to people already in Australia on temporary visas. In 2020–21, around two thirds of permanent visas are forecast to go to people already in Australia, with more places allocated in particular to partner visas drawn from onshore (discussed further below). The resumption of arrivals of international students will therefore be a key factor in whether the NOM projection is realised for 2020–21 and whether NOM will recover in the forward estimates.

Migration Program

The Migration Program provides permanent visas for skilled and family migrants to Australia. The planning ‘ceiling’ for the program in 2020–21 has been set at 160,000 places, the same as in 2019–20 (although in 2019–20 only 140,366 visas were granted (p. 9), largely due to disruptions caused by the COVID-19 pandemic). However, this does not mean that 160,000 new migrants will come to Australia in 2020–21. Over the last several years, around half of permanent visas granted under the Migration Program each year have gone to people who are already in Australia on a temporary visa. In 2020–21, this proportion will increase to around two thirds. Granting the bulk of Migration Program visas to people already in Australia will allow the Government to fill places in the Program without adding significantly to the cohort of citizens and visa holders overseas wanting to travel to Australia, and increasing pressure on arrivals caps and quarantine capacity.

The family stream of the Migration Program usually accounts for around a third of the places available. In 2020–21 this will increase to around half (77,300 places, plus an additional 3,000 places for child visas). This significant increase in family visa places is due to an almost doubling in the allocation for partner visas—72,300 places in 2020–21, compared to a planning level of 39,799 in 2019–20. The Government has faced recent criticism over what has been described as a ‘blowout’ in processing times for partner visas, resulting in a large backlog of applications. As at 30 June 2020, there were 96,361 partner visa applications ‘onhand’ (p. 50). The significant increase in partner visa places for 2020–21 is likely an effort to clear this backlog.

English language requirement for partner visas

Alongside the announcement of the planning level and visa allocations for the 2020–21 Migration Program, the Government announced that it intends to introduce an English language requirement for partner visa applicants, and partner visa sponsors who are permanent residents (that is, not citizens). Unlike skilled visas, for which applicants must generally demonstrate a specified level of English language proficiency, there is currently no such requirement for applicants for family stream visas, as these are designed to allow people to reunite with family members rather than explicitly to work.

The Government’s rationale for a language requirement for partner visa applicants (but not other family visa applicants, such as parents and children) is that speaking English is ‘critical to getting a job, fully participating in our democracy and for social cohesion.’ Minister Tudge has previously said that English language ability is critical for social cohesion and successful migrant settlement, and alluded to suggestions that ‘basic conversational English capability should be required before receiving permanent residency’. However, a specific proposal to introduce such a requirement for any of the family stream visas has not previously been mooted.

While complete details of this measure are not yet known, the Minister has stated that it will apply from late 2021, and will require applicants and their permanent resident sponsors to have functional English or ‘demonstrate that they have made reasonable efforts to learn English’. The partner visa program involves a two-step process by which applicants are first granted a provisional visa, allowing them to live in Australia while the permanent visa is processed. The English language requirement will need to be met for the grant of a permanent visa, not for the grant of a provisional visa. People living in Australia on a provisional partner visa are eligible for free English language classes under the Adult Migrant English Program (AMEP), and the Minister has indicated that completing 500 hours of these classes will be sufficient to demonstrate an attempt to learn English. Other ways in which this may be demonstrated have not been articulated.

Mandating English language ability as a condition for the grant of a permanent partner visa will require amendment to the Migration Regulations 1994, which will be subject to possible disallowance by the Senate.

Migrant groups have expressed significant concern about this policy, labelling it discriminatory and rejecting the argument that it will assist migrants to settle and benefit social cohesion.

Humanitarian Program

The Humanitarian Program provides permanent visas for refugees and others in humanitarian need. In 2020–21, the planning level for the Humanitarian Program has been reduced by 5,000 places compared to 2019–20: from 18,750 to 13,750. This is a return to the pre-2017 program size.

The number of places available in the Humanitarian Program sat at around 13,750 for many years, before it was gradually increased to 16,250 in 2017–18, and 18,750 in 2018–19. This followed a commitment made by the Government in 2014 following negotiations with the Senate crossbench over the passage of the contentious Migration and Maritime Powers Legislation Amendment (Resolving the Asylum Legacy Caseload) Act 2014. The increased number of humanitarian places was formalised in a Determination made by then Immigration Minister Scott Morrison in December 2014. This Determination did not specify the number of places to be available beyond 2018–19. However, in 2016, then Prime Minster Malcolm Turnbull, in a speech to a Leaders’ Summit on Refugees in New York, stated that Australia’s Humanitarian Program would be maintained at 18,750 places ‘from 2018–19 onwards’. The program did remain at 18,750 places in 2018–­19 and 2019–20, but has now been reduced to 13,750 places.

As the report on Australia’s Offshore Humanitarian Program: 2019–20 shows, the planning level for 2019–20 was 18,750 places. However, the number of visas actually granted was significantly lower than that, at 13,171, due to the impacts of COVID-19—the Government suspended the granting of offshore humanitarian visas on 19 March 2020 (p. 1). Hence, the planning figure for 2020–21 is similar to the actual outcome for 2019–20. It is likely that COVID-19 will continue to disrupt the Humanitarian Program in 2020–21, and the Minister has stated that the reduced planning figure ‘reflects the global impacts of the COVID-19 pandemic which will continue to present challenges to delivery in 2020–21.’ However, the reduction in places appears to be factored into the Budget as a permanent cut. Budget Measures: Budget Paper No. 2: 2020–21 suggests the reduced program size, and reforms to settlement services, will result in savings of around $958 million over the forward estimates (p. 109).

Refugee advocates have condemned the reduction in the Humanitarian Program, arguing that in the current climate there is need for more refugee resettlement places, not fewer.

Social cohesion

The Budget provides for $62.8 million over five years commencing in 2019–20 for a social cohesion measure. This includes $21.5 million in the current budget year and $28 million over the forward estimates, with the remaining $13.3 million having been spent in the 2019–20 year (Budget Paper No. 2, p. 112).

The measure was announced on 28 August 2020 in an address to the National Press Club by the Acting Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs.

Of the total, $37.3 million is allocated over four years for promotion of social cohesion and for countering malign information online. The Minister’s address stated that components of the measure would include a campaign on Australian values, national identity and multiculturalism. Promotion of Australian citizenship and encouraging its uptake would also form a part, with updates to the citizenship test and to the Australian Values Statement also announced.

Enhancing engagement with multicultural communities is allocated $17.7 million over four years. This aligns with a boost to the Department of Home Affairs Community Liaison Officer network announced in the Minister’s address.

The remaining $7.9 million is provided over four years to establish a social cohesion research program, which will be at least in part through a partnership with the Scanlon Foundation Research Institute.

Budget Paper No. 2 (p. 112) further notes that the costs of the measure will be partially met from within the existing resources of the Department of Home Affairs.

The address of 28 August announced changes to the AMEP, with the key elements being to lift the cap on class hours (previously a total of 510 hours of free tuition, with some clients eligible for supplementary hours) and remove the time limits within which clients had to enrol and complete their program. The budget papers note that these reforms make up part of the measure, although there are no additional allocations specifically indicated for the AMEP. The Minister noted that the AMEP is currently funded at $250 million per year over four years.

The Minister’s address noted that people would be eligible to attend AMEP courses until they achieve vocational-level English (IELTS 5.5 or equivalent), beyond the current level of functional English (IELTS 4.5 or equivalent). These reforms will require amendments to the Immigration (Education) Act 1971 which governs the AMEP.

All online articles accessed October 2020

For copyright reasons some linked items are only available to members of Parliament.

Note: This article was amended on 28 November 2023 to provide further detail around who is included in calculating Net Overseas Migration.

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