Federal Budget Update

The Treasurer of Australia, The Hon Josh Frydenberg MP, delivered his first Budget at Parliament House last night, with barely a mention of the word “immigration”.

Apart from tax cuts, this Budget focused on the Government’s commitment of $100 billion to new infrastructure projects, $525 million to skills packages and a number of initiatives to encourage more people to study, train and work in regional areas.

For employers seeking to sponsor overseas workers on a temporary or permanent basis, the Budget did not signal any significant change in policy, apart from the usual increase in Government application fees (see below). Other relevant announcements include:

Skills Training

The Treasurer announced the creation of 80,000 new apprenticeships, $8,000 per apprentice placement to employers, and 10 new training hubs in regional Australia.

There was no reference to the Skilling Australians Fund as a source of funds for these initiatives.

The reason could relate to the forecast that the levy will collect $126 million less in the four years to 2022-2023, than previously forecasted. This reflects lower-than-expected demand for employer nominated visas, however employers will be pleased that there was no mention of increasing the levy.

Whether skills training initiatives will be sufficient to deliver the required skills within the required timeframe to support the new infrastructure projects remains to be seen.

Migration (Permanent Visa) Program Planning Level

The Government had announced the Migration Program Planning Level for permanent migrants prior to the Budget. Although the announcement and media attention focused on a reduction in the migrant intake from 190,000 to 160,000 for the 2019-2020 program year, the actual reduction in number is minor and we do not expect there to be any real change for most employers seeking to transition sponsored temporary employees to permanent residence.

As shown in the table below, the planning level for 2019-2020 differs marginally from the actual number of permanent visas granted in 2017-2018. We understand that the numbers will be similar for this year, 2018-2019.The table shows that in terms of permanent visas, the Government will continue to focus on the Skilled Stream, especially Employer Sponsored (Employer Nomination Scheme) and new Regional visas.

Regional Visas – Skilled Work Regional (Provisional) and Skilled Employer Sponsored Regional (Provisional)

With approximately 20% of the Skilled Stream allocation, it is clear that the new growth area within the permanent migration program is Regional visas.  Two existing regional visas will be discontinued, and two new regional visas will be introduced and accorded priority processing from 1 November 2019. Details are scant at this stage, however the occupations list will be much broader than under current programs, and a pathway to permanent residence will be available after 3 years.

Enhanced compliance is likely to be implemented to ensure that recipients of these visas live in regional Australia.

Global Talent Visas

The Government has allocated $12.9 million over 3 years to continue to attract Global Talent, however the current pilot scheme will be revised; rather the 5,000 Global Talent places will be drawn from the non-nominated and non-sponsored cohort, particularly those with a background in STEM.

Government Application Fees

Budget papers confirmed an increase in Government Application fees for all visa subclasses, except the Visitor Subclass 600. The increase will be 5.4%, effective from 1 July 2019.

This fee increase is expected to increase revenue by $275 million from 2018-2019 to 2021-2022.

New fees will be confirmed as soon as available.

DISCLAIMER This information is current as of 3 April 2019 and subject to change. The information contained in this publication is of a general nature only. It should not be used as legal advice. To the extent permissible by law, Ajuria Lawyers and its associated entities shall not be liable for any errors, omissions, defects or misrepresentations in the information or for any loss or damage suffered by persons who use or rely on such information. Liability limited by a scheme approved under Professional Standards Legislation.