How to understand 457 visa statistics: Don’t read the Australian

 

In August last year, I wrote about some poor reporting on 457 visa statistics. Natasha Bita in the Australian wrote:

RISING  unemployment has dampened demand for migrant workers, with 40 per cent fewer foreigners seeking visas to work here last financial year.”

This was nearly completely incorrect. The “demand” didn’t really do anything. Instead, a giant price increase on 1 July brought forward thousands of visa applications into June 2013:

This price increase did not create demand. Instead many visa holders already in Australia applied for a renewal a bit earlier than they would’ve otherwise and a number of businesses brought forward overseas hires. All of this masked what was a very standard year in 2013-14.

Ten months later. Same journalist, same paper… same mistakes:

Indian, British and Chinese workers are queuing for jobs in Australia, with applications for 457 work visas jumping by 15 per cent in a year.”

By definition, if you have artificially low numbers for 2013-14, you are going to see increases the following year even with the status quo. The same price hike on 1 July 2013 is “causing” the current rise in visa applications. This is because the 15 per cent “jump” is occurring in 2014-15, referenced against 2013-14, the year with artificially low numbers.

This isn’t rocket science. The current movements in visa application trends are probably about 10 per cent related to the labour market and 90 per cent related to the decision in the 2013-14 Budget to jack the fees of 457 visas by 200-800 per cent (depending on family size). This should wash out of the system over the next 6-12 months.

The public are told a nice narrative that correlates succinctly with the numbers. What a shame the narrative is completely unfounded.

There are many culprits here.

Let’s start with the Department of Immigration and Border Protection. They could have mentioned even a little bit of this background in their quarterly reports (March 2015). Instead, they are making the reports harder to understand by taking away some important contextual graphs on page 1. Of particular note was the graph that showed the actual number of 457 visa holders in the labour market, “Number of primary subclass 457 visa holders in Australia at the end of each month”:

Screen Shot 2015-07-06 at 8.56.38 pm

Looking at the graph, you see the number of 457 visa holders in the labour market moves slowly over time and never erratically (noting, of course, the dip in December as people holiday outside of Australia).

Unfortunately, you cannot see this graph in the latest report. For some reason, it has been removed. You instead need to dig into a pivot table that currently has a broken link. Yet even the text report says “The number of primary visa holders in Australia on 31 March 2015 was 106,750.” An extra couple of clicks and you can find out that the number at 30 June 2014 was 108,870. Doesn’t sound like a rollercoaster ride of 15 per cent increases and 40 per cent slumps to me.

I’d be very surprised if Natasha Bita read my previously blog post. Reading obscure migration blogs is not recommended for reporting in national newspapers. However I would’ve happily taken her phone call in my day job at the Migration Council Australia. I’ve spoken to numerous journalists – including three from the Australian – about migration trends and what my interpretation is of the latest statistics. I know a handful of other people who provide similar opinions. Instead, her article is a complete grab-bag of seemingly random statistics with a misleading central point (noting it is not deliberately misleading).

Lastly, I’ll take some of the blame. I got really hot under the collar when I read Ms. Bita’s article from last August. I made a commitment to myself that I would work harder to try and explain migration and the labour market – as I see it – to more people in the media, whether this be by random emails or actively following up what I regarded as mistakes. I started strong but a disappointing experience in March this year dissuaded me from keeping it up. My resolve has firmed once again.

There are really interesting, difficult policy questions regarding migration policy and the labour market in Australia. Yet the tosh that gets served up in the media makes it all but impossible for even interested readers to understand what is occurring. More damagingly, poor reporting prevents policy settings from being more closely examined. The hospitality industry continues to run rampant with the 457 visa program, with little regard for policy goals, the people they exploit or wages they seek to undercut.

This is horrible for policy outcomes and underpins ignorance in the community on how migration effects the labour market. The rising public debate about the migration provisions in the Chinese-Australia Free Trade Agreement will demonstrate how this ignorance can harm social cohesion and attitudes to migrants in the community.


Migration and Development in an Australian Context

The development blog Devpolicy have kindly published a piece of mine, titled ‘Migration and Development in an Australian Context‘. Full text below. Devpolicy are one of the very few Australian outlets who have an active interest in how migration to Australia can stimulate development in the Pacific. I’d encourage you to read their blog whenever you get the chance.

Would you rather be rich in a poor country or poor in a rich country? Dani Rodrik asks this question in his keynote presentation [pdf] to a recent World Bank conference on migration and development.

Yet this isn’t a question at all if you only focus on income.

Rodrik shows a rich person from Niger has a representative income of $2,918 while a poor person from Norway has a representative income of $13,049. This disparity reflects the fact that “the bulk of global inequality is generated by income gaps between countries, not within countries” (for an excellent breakdown of between and within country inequality, see Branko Milanovic’s article ‘Global inequality of opportunity: how much of our income is determined by where we live’).

There is a loud public debate about inequality in Australia and only muffled whispers about the role migration might play in addressing inequality. ‘Between country inequality’ is the poor cousin of ‘within country inequality’ notwithstanding the fact that a person moving from the Solomon Islands to Australia would rank amongst the most powerful mitigating forces of global inequality.

Yet Rodrik does not propose radical solutions. He values the role of the nation-state. His conclusion – there is more opportunity for labour mobility from poor to rich countries but limits are important – points in part to a policy solution of iterative expansion and regularisation of migration pathways, carefully managed by migrant-receiving countries.

If you accept this argument, Australia is well positioned to further the migration and development agenda. Our geography allows for highly effective management of our borders. Our economy and existing migrant community stimulate demand from people across the world to migrate to Australia.

The Center for Global Development ranks Australian highly on migration as a development tool due to both a “large share of foreign students from developing countries” and a “large number of immigrants from developing countries entering Australia”.

This status quo is positive but has occurred almost completely by accident. Australia has a generous immigration framework not because it fosters development for other countries but because both major political parties in government see it as beneficial for Australia. As far as I’m aware, no Immigration Minister has set out to boost Australia’s development effectiveness by tinkering with the standard migration programs that do the heavy lifting of immigration to Australia.

The one program with an explicit mandate to boost development is the Seasonal Worker Program. The introduction of the program was recognition that there is a place for migration in Australia’s development arsenal. However as readers of this blog are all too aware, the SWP is a program lacking success to date. This is in part because it is not a standard migration program. Whatever the rhetoric about the benefits for regional Australia, the program settings erred towards a development-centric approach instead of one focused on domestic employers.

Stephen Howes has written extensively (here and here) on the changes announced last week to the Seasonal Worker Program (SWP). Taken as a whole, these changes point to a shift in how the SWP is considered by government.

For a start, the Northern Australia White Paper is not the place you would immediately think of for a detailed discussion on Pacific labour. Yet by linking Pacific labour mobility explicitly to domestic policy concerns, such as labour demand in Northern Australia, the government has reinforced a central theme of Australian immigration policy: first and foremost, success will be judged by the benefit provided to Australia and Australians. If the SWP is to succeed in Northern Australia, it will be because Northern Australia needs the SWP, not because the SWP will help Pacific development.

Some might protest that we can surely accept more migrants from poor countries because it is the right thing to do, not because it is good for Australia. Unfortunately for people who advocate from this position, the last six years of Seasonal Worker Program highlight some of the problems inherent in this approach.

While the recent changes are promising, the government still has some serious legwork to do. Advocacy and promotion to potential employers should be priority number one following the liberalisation of the regulations. The biggest risk is inaction and bureaucratic drift across multiple agencies. With working holiday visa holders likely running to exit the horticultural sector and heading straight into the tourism sector, employers will need assistance to ensure a smooth transition as possible.

As nothing catalyses action like a target, I would like to propose one: 10,000 visas granted for the Seasonal Worker Program in 2017-18, with 50 per cent going to Northern Australia. We know labour demand exists for migrants to do this work but it is backpackers who predominantly undertake it. A target of 10,000 visas for seasonal workers would not undermine opportunities for Australians and it would show a public commitment to the program, from the government directly to employers.

However not all of the changes announced in the White Paper were positive. Other changes to the working holiday visa program – to allow participants to come to Australia for two years full-time work – push the program further away from its original intention. ‘Cultural exchange’ is being replaced as the primary consideration by labour concerns. The fact this program overwhelmingly facilitates migration from developed countries should give us pause. A low-skilled labour migration program that mostly excludes developing countries is not something to expand.

Finally, it is never too early to think about what should be next. What are other potential migration pathways to encourage Pacific development while meeting the standard of net benefit to Australia? Will the government’s proposed two-year microstate visa lead to more permanent migration opportunities? Can a visa lotto program – such as the U.S. diversity lotto or the New Zealand Pacific Quota – emerge in Australia? Can migration provide effective short- and medium-term relief from natural disasters like Tropical Cyclone Pam in Vanuatu? What are the major barriers to working holiday agreements with Pacific island countries? Working through how ideas like these can be incorporated into Australia’s immigration framework should be higher on the agenda for those with an interest in Pacific development.


How many ways can you define a person? New Zealand citizens in Australia

Last week the ALP introduced a private member’s bill to extend HELP eligibility to some New Zealand citizens. You can read the bill and explanatory memorandum here.

This is just one example of how New Zealand citizens who are long-term residents in Australia are excluded from full participation and support in Australian society. Source: Wikipedia, creative commons

To demonstrate the ad-hoc approach government has towards this group of 500,000 people, the team at OzKiwi have combed through various pieces of legislation and highlighted how New Zealand citizens are defined as residents. Note the different definitions are substantial and contained in pieces of legislation that have a heavy effect on New Zealand citizens living in Australia:

New Zealanders Residency Status – Comparison of Legislation (Table compiled by Oz Kiwi)

Legislation

Status of New Zealand Citizens

Health Insurance Act 1973

‘Australian resident’ is defined to include New Zealand citizens living in Australia.

Higher Education Support Act 2003

New Zealand citizens have been excluded since 2005 on the grounds that only Australian citizens and permanent humanitarian visa holders are eligible for HELP Loans.

Income Tax Assessment Act 1997

SCV holders are permanent residents

Migration Act 1958 ss. 30, 32 and 204

There are four separate, and inconsistent definitions that apply to New Zealand citizens:

  •   s30(1) – a permanent visa, due to its indefinite status;
  •   s30(2)(c) – a temporary visa, on the basis that Special Category Visa holders have a specified status (New Zealand citizenship) under s32 of the Act;
  •   Section 32 defines Special Category Visa as a class of temporary visas (also referenced in Regulation 5.15A of the Migration Regulations);
  •   s204 defines permanent resident as a person (including an Australian citizen) whose continued presence in Australia is not subject to any limitation of time imposed by law. (An SCV is an indefinite, albeit temporary visa, therefore captured by s 204 ).

Migration Regulation 1.03

‘Australian permanent resident’ is defined as the holder of a permanent visa. This excludes all SCV holders, even though they are entitled to reside permanently in Australia.

Migration Regulation 5.15A

Defines the Special Category Visa as ‘temporary visa’.

National Disability Insurance Scheme Act 2013

For the purposes of paying the NDIS levy New Zealanders are classed as residents under the Health Insurance Act 1973. But for the purpose of being entitled to NDIS services, a person must be an Australian citizen, permanent visa holder or a protected SCV-holder. Therefore, non-protected SCVs MUST pay levy, but cannot access the NDIS scheme.

Social Security Act 1991

s. 7 defines a ‘resident’ as an Australian citizen, permanent visa holder or Protected Special Category Visa holder. Therefore, does not capture New Zealand citizens who arrived post 26 February 2001, commonly referred to as ‘non-protected’ Special Category Visa holders. (Note: this is not a defined term in the Social Security Act or the Migration Act.) The current definition of resident was inserted by the Family and Community Services Legislation Amendment (New Zealand citizens) Act 2001, replacing an earlier definition that included all SCV holders.

s. 861 (12) provides for a separate definition of ‘resident’ for the purposes of the Job Commitment Bonus. This definition is stated to have ‘the meaning given by section 7 (disregarding subparagraph 7(2)(b)(iii))’ – in other words, it excludes all SCV holders, including protected SCV holders. This definition was added by the Social Security Amendment (Increased Employment Participation) Act 2014.

Superannuation Guarantee (Administration) Amendment Bill 2015

1.23 A ‘temporary resident’ under the Migration Act 1958 would also include a New Zealand citizen, even though New Zealand citizens can generally stay indefinitely in Australia.

2.122 […] New Zealand residents would also be included in the exclusion of temporary residents from the prompt of choice as well so as not to cause confusion for employers.

Norfolk Island Legislation Amendment Bill 2015

Inserts a new subsection 7(2AA) into the Social Security Act 1991 that would exclude permanent visa holders who are New Zealand citizens on Norfolk Island from the definition of a ‘resident’ and thus social security eligibility. Permanent visa holders of all other nationalities on Norfolk Island will be included in the definition of ‘resident’. This has the effect of placing restrictions on NZ citizen permanent visa holders on Norfolk Island that apply to no other group of permanent visa holders in any part of Australia.

For more information on advocacy efforts, see the Oz Kiwi website here.


Would you rather be rich in a poor country or poor in a rich country?

“Would you rather be rich in a poor country, or poor in a rich country?”

Dani Rodrik asks this provocative question to set up his thesis on whether nation-states are the enemy of global equality.

By taking a top 10 GDP per capita country (Norway) and bottom 10 GDP per capita country (Niger), he demonstrates this isn’t really a question at all: In Niger, the richest five percent of the population have a representative income of $2,918 compared to a representative income of $13,049 for the poorest five percent of Norwegians.

Rodrik argues that the nation-state is central to growth and is not the enemy of global equality. However at the same time, there are good arguments for both “expanding labour mobility, at the margin” and “placing limits that would leave us far short of full mobility”. You’ve got to love economists. Yet even if you advocate for completely open borders, it strikes me you could get behind this as an incremental measure towards a more open global environment.

The point that struck me the most was: “It would be a pyrrhic victory to remove restrictions on labor mobility to the point where it weakens the capacity of nation states to provide the public goods needed for high productivity.”

If you take this as true, then perhaps the most important question in development economics and political economy is where that point is, closely followed by how we can get there. The events of 2015 appear to show that we are a long way from answering this and the risk of going backwards is firmer today than the same time last year.

H/t Chris Blattman (and read the full slide-show, it is excellent).


Increasing migration restrictions in the UK: working holiday visas

The UK Government has been on a five year journey to lower the number of migrants arriving. To this point, they are failing spectacularly given recent economic growth and migration numbers are higher than at any point in the Cameron government. Despite this, they continue to believe in a fantasy of reducing these flows to under 100,000 per year.

The latest strategy is to “tighten the rules” on working holiday visa holders from outside European Union countries.  As Jacquelin Magnay points out in the Australian:

“Current unrestricted movement throughout the EU has resulted in more than 318,000 new migrants in the past 12 months. Fewer than 16,000 Australians now arrive in Britain each year to work, well down on the 40,000 of a decade ago.”

The new rules will create a backlog, a deliberate queue to try and stop these people arriving.

Just like trade barriers, further increasing migration barriers in an increasingly globalised world will have a range of effects. The most insidious will be the long-term lack of good will on migration policy amongst countries. This British rule will place substantial limits on a soft institution that hundreds of thousands of past Australians have enjoyed.

More troubling, this will likely be used by future Australian governments to go down the same track. As we see on the citizenship debate, the “reforms” to British citizenship have been rolled out as an example and justification for the current push for more restrictive policies and increasing executive power.

Australia has one of the most open working holiday visa programs in the world. This comes with a range of policy issues which have long been ignored but at its essence, it is a positive program that can foster closer ties between individuals, communities and countries.

When one country unilaterally imposes migration barriers, reciprocity in a global system will take a hit. This is another example of the increasing trend for countries to impose more barriers to people movement in contrast to everything else we hear about an ever more globalised world.

 


Would you work at the Department of Immigration?

Would you work for the Department of Immigration?

Bernard Keane today called the department “utterly morally bankrupt” and “couldn’t see how anyone in good conscience” could work there.

More acutely, today’s First Dog on the Moon cartoon highlighted four prominent real life examples of what many would consider beyond the pale in terms of work duties, prefaced by the following quotes:

“You want to contribute to the glorious defence of our nation’s borders, to protect our wide brown land from tiny boats full of unarmed women and children. Good on you!”

“Simply complete this multiple choice questionnaire and we will determine your suitability for working in what is basically an enormous remorseless bureaucracy tacked on to a sinister program to systematically punish and dehumanise the desperate and the broken.”

Hearing about the sexual abuse allegations on Nauru sickens me. The Australian government and public, no matter how we choose to wipe our hands, has responsibility for people taken to other countries. This responsibility grows inversely to the capacity of those countries to provide adequate care for people. This is the real world result of policy played through a strictly political prism.

Yet.

Good people do work at the Department of Immigration ‘in good conscience’. I know a few and I’ve been told of more.

What happens if these people leave? They are replaced by someone who will perform poorly and without the daily struggle to try and improve the outcomes of people who are stuck in a real life nightmare. It might be something as small as replying to emails in a timely manner to ensure something gets done. It might be something much larger like questioning the why or the how of an operational matter. When the motivation to do that act is lost, when good people leave, the environment descends even further.

I happen to agree in part with Bernard Keane. When I was at the department, I made the personal choice to not work in the detention divisions. I’m not a martyr because of this and I didn’t shout it from the rooftops. But I didn’t feel I could perform those positions, both in a personal capacity and in line with my employment conditions.

Despite this, the people I had the most respect for were those who did take on those positions with clear eyes and a commitment to try and improve things where they could. A case manager who took each initial refugee interview seriously and on their merits despite hearing the a similar story 40 times in that week. A detention centre manager who provided pastoral care for their staff instead of creating a vitriolic environment, that led directly to dangerous conditions for both staff and migrants. An operational support staffer stationed on Nauru not because of the travel allowance but because they care deeply about what is at stake for young children.

These people will never be publicly recognised for doing their job effectively. That’s part of being a public servant.

It’s easy to say everyone should perform that way but the reality is that does not occur. Do not think for a second that there is a limit to bad behaviour. Environments can always be worse and what seemed bad last year quickly recedes into history. Think about how asylum policy has evolved and you can see how this works.

And I haven’t even discussed the majority of staff who work in roles that actively generate positive economic, social and cultural outcomes for Australia. There are over a thousand visa processing officers, greasing the wheels of our skilled, family and humanitarian migration programs. There are people working on the labour market, student visas, research and evaluation and a host of other matters. In this group of people you will likely find some of the strongest opponents of the current asylum policies anywhere in Australia.

Decent people can disagree on these questions. Personal experience and values will shape an individual decision.

I’ll end with this. From my understanding, the Department of Immigration and Border Protection is going to have over 12,000 staff come 1 July 2015. While some have left recently, particularly senior managers, I’d argue the department needs every single good staff member to both mitigate the worst effects of our asylum policies and improve the margins, the space where most public servants do the majority of their work. In addition, the people who create and support Australia’s excellent modern tradition of mass migration need to be there.

(Endnote: Initially I thought “It’s easy to be a journo and throw these quips around” but this is exactly the wrong type of argument people should prosecute, particularly if they work at the department. The media, at its best, provide the single greatest check on security and asylum policy. Perhaps I simply wish more nuance could be had in a public discussion that is largely nuance free.)


A submission to the 2015 ALP Draft Platform

The ALP recently released a draft platform and asked for submissions. The platform will be debated at the upcoming 2015 Conference.

I kept my comments to the section on skilled migration. I tried to write this submission in terms similar to the platform itself, so there is are not many policy details but more high level statements and comments. I also attempted to make my contribution able to engage with and pragmatic, knowing this is a tricky area for the ALP and we should be finding places of agreement as well as defining disagreement.

My submission is below and was provided the 18th of May.

ALP Policy Platform submission

Thank you for the opportunity to provide feedback on the draft national platform.

I previously worked at the Department of Immigration and currently work for the Migration Council Australia. This submission is provided in a strict personal capacity.

Section 55: There are demonstrated benefits of circular migration to both origin and destination countries. I believe the term ‘brain drain’ is an overly negative stereotype and the emigration of Australians can have long-term benefits to the Australian economy from return migration. An estimated ~1 million Australians live overseas and as a party, I believe there is value in better engagement and capacity using the Australian diaspora. New Zealand has a defined policy around its diaspora that could be considered. This would help encourage return migration and to import knowledge and innovation in a global economy.

Recommendation: Remove the term ‘brain drain’ and commit to engagement with Australia’s diaspora.

Section 59-60: There are multiple references to the role of temporary and permanent migration. This is the single most important policy for Australia’s skilled migration framework. I believe there should be pathway to permanent residency based criteria around time spent in Australia. The worst possible outcome is a migrant who is ‘permanently temporary’, excluded from full engagement in Australian society. This also undermines working conditions for Australian citizens and permanent migrants.

Recommendation: A commitment that no migrant will be ‘permanently temporary’.

Section 61-62: An increasing number of permanent migrants are granted their visa in Australia. This has increased from 23 per cent in 1996 to 50 per cent in 2014. This trend will continue to increase in the coming years and the implications should be explored more fully.

For example:

  • 70 per cent of 457 visa holders who stay in Australia for 10 months intend to become permanent residents. The term ‘temporary’ in this circumstance is a misnomer and hurts policy development.
  • Instead of providing information on workplace rights and responsibilities and welcoming permanent migrants to Australia’s community (Section 61.4), this process should have occurred on entry to Australia.
  • ‘Short-term skill shortages’ (Section 62:1) is the objective of temporary migration yet permanent migration is predominantly targeted at medium- and long-term critical skill gaps. There is some contradiction here.
  • Temporary and permanent migration decisions are often driven by decisions of migrants. This is missing from consideration in Section 61 and 62. While there is a legislative difference between an employer sponsored temporary and permanent visa, there is very little different between the two people in the labour market.

These trends are recognised in Section 65. Yet given these examples, I believe there is justification to merge Section 61 and 62 to demonstrate a policy approach that is more reflective on what actually occurs in the labour market with regard to skilled migration. Section 65 should also be incorporated as a general statement of principles.

By creating such a clear delineation between temporary and permanent migration, policy options become restricted and fail to capture migrants who can fall through the gaps.

Recommendation: Combine Section 61 and 62, with reference to similarities and differences of temporary and permanent migration.

Section 63: I support the commitment to removing the possibility to engage in sham contracting.

This section also provides a logical place to reference a commitment to ‘whistle-blower’ provisions for migrants who are exploited, regardless of their visa status. This status would not penalise migrants and provide a unique bridging visa allowing full work rights without a sponsor for a defined period of time.

Recommendation: Include a commitment to ‘whistle-blower’ status for migrants who are exploited in the labour market.

Section 64: I support Ministerial Advice Council on Skilled Migration. I believe the Council should work in similar fashion to the Productivity Committee, providing reports via formal terms of reference from the Minister for Immigration. In addition, a biannual labour market report would be released on how migration policies are functioning.

The Council should also have a demonstrated commitment to publicly releasing all reports. There should be a process to engage externally as the Council deems fit.

Recommendation: Include provisions where the Minister for Immigration can formally request specific reviews. Reference a commitment to transparency for the Ministerial Council.

Section 65: As discussed previously, merge with sections 61-62 to better article policy to temporary and permanent migration pathways.

The reference to requiring labour market testing for permanent residency is poor policy. This would hurt migrant’s settlement prospects and be an unnecessary barrier to gaining permanent residency. The previous commitment to permanent residency, “Labour prefers permanent skilled migration to temporary skilled migration” (Section 60), is undermined by constructing new barriers to permanent migration. Labour market testing would also stymie encouraging employers to sponsor temporary migrants for permanent residency, as referenced in the third sentence of Section 65.

I also believe “any transition to permanent residency status should not be automatic” is too strict. There are currently migrants who fall through the gaps, as it is easier to access temporary migration than permanent migration. Over time, this will lead to a growing population of migrants who are ‘permanently temporary’.

By providing a pathway to permanent residency based on time-criteria, for example 10 years, this will limit exploitation in the labour market and better support working conditions for Australian citizens and permanent residents.

I believe it is morally unjustified to tell a person who has lived in Australia for 10 years on a temporary visa to ‘go home’ given Australia is now their home. Even in cases whereby the labour market conditions have shifted, this should not force those who have made Australia their home to be removed.

Recommendation: Remove references to labour market testing for permanent residency status. Reference a commitment to a pathway to time-based criteria for permanent migration.

Section 66: I support the commitment outlined in this section. I believe now is the time to initiate a full re-write of the Migration Act. The Act was written in 1958 and the Regulations in 1994. In this time, migration has completely transformed. The Act is not able to deal effectively with a range of issues, such as the migration zone, the intersection with the Fair Work Act or temporary and permanent visas. In addition, policy is so broad that there are multiple occasions where legislation is poorly interpreted. A commitment to re-write the Migration Act would create a critical opportunity to address Australia’s migration policy framework for the 21st century.

Recommendation: A commitment to introduce a new Migration Act.


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