Inside Story

Where now for immigration policy?

How will Scott Morrison respond to pressure from the Coalition’s right to cut immigration?

Peter Mares 29 August 2018 1935 words

Surprise pick: David Coleman, appointed immigration, citizenship and multicultural affairs minister this week, shown here with Scott Morrison at Lakemba Mosque, in his NSW seat of Banks, in October 2014. Jeff Tan/Crowdspark/AAP Image

Along with the National Energy Guarantee and corporate tax cuts for the big end of town, immigration was one of the major issues that fuelled the revolt against Malcolm Turnbull’s leadership. High rates of immigration had increasingly been linked in public debate with rising house prices, low wages and urban congestion (not least because senior government figures like Tony Abbott and Peter Dutton repeatedly asserted they were connected).

The new prime minister, Scott Morrison, has been one of the few figures on either side of federal politics willing to say anything positive about immigration. As treasurer, he hit back against Tony Abbott’s call for the permanent migration intake to be cut by 80,000 places annually, pointing out that this could blow a $4 billion hole in the budget over four years. He also challenged the connection between immigration and crime drawn recently by Abbott, Dutton and Turnbull.

If Turnbull were still prime minister, he would be presiding this week over a cabinet meeting focusing on how to respond to Australia’s population pressures. Although a truce seems to have been struck among the Liberal Party’s battling factions following the change of leadership, the twin issues of population and immigration are unlikely to disappear from the political agenda.

Many Coalition backbenchers fear that unless the government is seen to act decisively on public concerns, they will continue to haemorrhage votes to fringe parties on the right, especially in marginal seats in the decisive electoral battleground of Queensland. Some early indications suggest how Morrison might respond to this pressure.

One of the surprises in his ministerial line-up was the appointment of the relatively unknown assistant finance minister, David Coleman, to fill the new-but-old role of immigration, citizenship and multicultural affairs minister. “David has a keen understanding of the many different backgrounds and the many different issues that need to be managed to ensure that Australians who have come from so many backgrounds get that fair go I spoke of,” Morrison said when he announced his new team.

How the prime minister reaches this conclusion is not immediately clear from Coleman’s official biography. Perhaps he bases his judgement on the fact that Coleman represents the relatively diverse (and historically Labor-held) Sydney electorate of Banks, whose population is 44 per cent overseas-born, with people of Chinese ancestry making up the largest migrant group. In Peter Dutton’s seat of Dickson, by contrast, only about 23 per cent of residents are overseas-born, and the largest migrant groups are from England, New Zealand and South Africa.

Regardless of constituency, we can hope that reuniting immigration and multiculturalism would prompt any minister to weigh his or her public pronouncements carefully and put social cohesion ahead of short-term electoral gain.

If Coleman understands the connections between the three elements of his portfolio, and particularly between multiculturalism and citizenship, then he may also want to deal urgently with the massive backlog in citizenship applications. Under Dutton, the number of applications on hand blew out from 23,000 in 2014 to 210,000 this year, and the average processing time is now sixteen months. Denying or delaying citizenship to long-term permanent residents seems the least helpful way to promote a sense of belonging, connection and participation among recent migrants.

Coleman is not in cabinet, and his ministry still falls within Home Affairs, but Morrison, himself a former immigration minister, appears to recognise that it was a mistake to allow immigration to be subsumed into a mega national-security portfolio. “Immigration, of course, forms part of national security policy, but it also has always played an important role in economic and social policy,” he said. “We need a strong focus on our immigration program so it brings the skills and the harmony and the unity that we want from the program.”

Morrison seems to be pushing back against the Dutton supporters, who see demonising migrants from certain backgrounds as a way both to wedge Labor and to claw back votes from the likes of One Nation. By giving Alan Tudge, the former immigration and citizenship minister, a portfolio that combines population with cities and urban infrastructure, he also appears to be seeking to shift debate about population pressures to take in more than just migration numbers.

Morrison and Coleman will probably still have to find ways to appease those within the Coalition’s ranks who feel that cutting immigration would boost their chances of re-election. They should start by explaining to the party room that cutting immigration is easy to say, but hard to do.

Back in the good old days of the twentieth century, governments could increase or reduce the flow of immigrants relatively easily by raising or lowering each year’s migration planning level in the budget. Whitlam cut immigration numbers sharply after winning office in 1972, as did Howard in 1996. But immigration is no longer like that. As SBS Digital Lab’s new data visualisation shows, temporary migration now dwarfs permanent migration. And while government can cap permanent migration, temporary migration goes up and down with the economy, with business needs and with other factors like the relative value of the Australian dollar.

Indeed, Australia’s much-debated crossing of the twenty-five million population threshold earlier this month would not have happened for quite a few more years if not for the presence of more than a million long-term residents on temporary visas. Among them are about half a million international students, and no limit currently applies to the number of additional students who might choose to study here in future. Indeed, our universities and training colleges are doing their best to open up new markets and expand their enrolments.

It is reasonable to debate whether international student numbers should be capped. But we need to understand that this isn’t a lever that government can simply pull at whim. It is a complex issue with profound implications for the economy and the labour market.

According to the latest data snapshot from Universities Australia, international education was worth $30 billion in 2017. Overseas students account for more than a fifth of all university enrolments and tertiary institutions are heavily reliant on their fees. If the industry declines, extensive job losses are inevitable, not just in education but also in related industries like accommodation and tourism.

Other tricky practical issues would also need to be negotiated. If Australia were to cap the number of international students, how would the available quota of places be shared between institutions?

Currently universities and colleges compete with one another on fee levels, reputation, course offerings and the attractions of their home city. If student numbers were limited, things could get ugly. Bigger players might muscle out smaller institutions, and if some universities failed to attract sufficient enrolments they could land in financial trouble.

Meanwhile, the federal government would be under pressure to ensure that the rationed international places were fairly distributed between states and regions. If the government allocated places in this way, though, it would undermine the market competition on which the system is based — competition not just between universities here, but between Australian institutions and rival international providers in a globalised market. In short, capping student numbers could damage the competitiveness of Australia’s third-largest export industry.

International student numbers are likely to decline in coming years anyway, because Peter Dutton made it significantly harder for international student graduates to move to permanent residence. Previously, for example, thousands of students moved onto a 457 temporary skilled worker visa before applying for permanent residency. But the 457 visa was abolished and replaced with a temporary skills shortage visa, which is much harder for students to attain. Other established student pathways to permanent residency — the Regional Sponsored Migration Scheme, for instance — have also been narrowed by a higher English-language proficiency cut-off and a requirement for more years of relevant work experience.

Over time, as awareness spreads of how difficult it has become to switch from successful study to successful settlement in Australia, the recent rapid growth in new enrolments is likely to slow or even reverse.

Alongside overseas students, about 135,000 working holiday-makers are living in Australia at any one time. We could reduce immigration by cutting that program, or by removing the offer of a second visa that encourages backpackers to work in rural areas. But this would hurt the tourism industry and horticulture. Remember what happened when the government tried to tax backpackers at 32.5 cents in the dollar when they harvested fruit and vegetables? Farmers protested that their crops were rotting in the fields, forcing the government into a highly publicised backdown. Far from winding back the working holiday program, the government has been expanding it.

It is much easier to cut permanent migration. Indeed, Dutton has done so as home affairs minister, though without bothering to go through the cabinet process of changing the numbers in the budget. He simply redefined the annual planning level as a “ceiling” rather than a target. As a consequence, the government fell 6400 visas short of the 190,000 planning level in 2016–17 and came in 28,000 visas short last financial year. The official explanation was tougher vetting of applications, but this is far from convincing.

Regardless of why Home Affairs filled fewer places, cutting the numbers in the permanent migration program doesn’t necessarily produce fewer migrants in the short term, since it has no immediate effect on temporary migration. It may result in lower numbers in the longer term, by making it clearer that temporary migration is not a reliable stepping stone to permanent settlement, but such changes won’t be felt until long after the next federal election, far too late to staunch the flow of votes to anti-immigration candidates.

In the meantime, by failing to meet the migration planning level, Home Affairs has probably created a blowout in the number of people stuck on bridging visas as they wait for their applications for permanent residency to be processed. Since Dutton took over responsibility for immigration in December 2014, the number of people in Australia on bridging visas has almost doubled, from 90,000 to 176,000. Many of those people will be the partners of Australians, and can’t morally or legally have their applications for permanent residence delayed or denied.

Another issue that Morrison and Coleman will confront is how to spread migrants beyond the big cities, and especially beyond Sydney and Melbourne. As citizenship and multicultural affairs minister, Alan Tudge had been laying the public groundwork for a major initiative in this regard, not least with questionable statistics that overplayed the extent of the problem.

Before the wheels fell off Turnbull’s leadership, the announcement of a new provisional residence visa was understood to be imminent. Such a visa was canvassed as part of the government’s plan to simplify and modernise the visa system. While no details have been released, the tenor of Tudge’s public comments suggests that a new provisional visa could be used to force migrants to reside in regional areas for a set number of years before they become eligible for permanent residence.

There are many unresolved questions and big challenges ahead. With border control — and presumably boat turnarounds — remaining Peter Dutton’s responsibility, where do asylum seekers, refugees and offshore processing fit into the departmental division of labour? Are asylum seekers who reach Australian territory without authorisation an immigration matter or a national security issue? Who is responsible for finding a resolution of the national shame and pointless cruelty that is Nauru and Manus before more people die? Let’s hope this task falls to Coleman and that, with Morrison’s support, he is able to chart a change of direction and quickly resettle refugees in Australia and New Zealand. •