Transcript: Migrant intake into Australia
Audio transcript (edited)
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Thanks very much Ben. I drew the short straw so I'll go first. The first slide's a bit redundant since it's basically the same as the second so. Okay we've got the – talk a bit about how the Commission does its work. It's a very transparent and open organisation and we collect evidence via submissions and meetings and round tables and so forth. And doing our own research, so it's an organisation that tries to be totally transparent. Everything's published on our website and then we inform our thinking on the basis of a draft report and then a final report.
That's effectively how it goes and then the government can either accept or reject our recommendations when the final report is tabled in parliament. So it is all separate to the government. We receive the terms of reference from the government and the terms of reference here, have three major components. Just like any other enquiry there are parts that are easier to understand than others. And they're quite, the tables of reference is much longer than this list here. But the key part of this is to assess the costs and benefits of immigration. I'll talk a bit more about what we mean by that in a second. You can see on the chart here, the slide, about the effect on the budgets for the government. But it's not just that, it's the effect on the economy, on the environment, on the social fabric of our society. All parts of that are part of our enquiry.
We're also looking at the interaction between temporary and permanent migration and I'll show you chart how that's changed over time. Because that's an important part of this enquiry, to understand how that's likely to change in the future. It says here in the terms of reference the optimal interaction. Sometimes you have to be careful about what optimal means in these types of contexts because you can imagine, in terms of an intake to Australia or any other country for that matter. That there's a range, which is likely to be optimal. There's no, I don't think it's fair to say that there's a single rate that's optimal. It's going to be a large range and maybe we'll be able to inform on our recommendations or our findings about what type of range would be.
And our system is primarily based on skilled immigration and we'll talk a bit more about that in a second. And the main thing there, in this enquiry, the third part of this is to look at alternative methods of allocating the quota. Now the temporary migration is uncapped and we'll – I'll explain that in a second. The permanent migration has a quota and people can argue, and if you looked at our website you'll see there's submissions from some people who say that we should have a zero quota. And other people who say there should be no quota whatsoever and a lot of people in between. So it's not a – it's not an uncontested area in terms of what a quota is. But once you have a quota, then how do you allocate the quota is a crucial determinant.
At the moment for our permanent intake we have skills points test and we're asked to look at a particular option, which would effectively mean that there would be a test for health status, as there is presently and on security and then there would be a price. Maybe there would be more than once price but the particular option we've been asked to look at would be that there would be a single price, which would allocate that quota and we're happy to talk, by the way, later on during the questions, anything about this. And if there's any clarifications you want in between that's fine too. But if you want any solid questions, I suggest holding them at the end when we've got a microphone going around.
The PC has done a bit of work in this space before. Not about allocating by a price but it's certainly done work in, for example in 2006 we did a report on the cost and benefits of migration. In 2010 there was a publication about population and migration and in 2011 we had a round table on a sustainable population. So I alluded to before, that we had a fair bit of consultation in terms of our report and as you see we've had meetings including internationally, I think there was more than 80 actually, quite a lot more but anyway that's what's on that chart. It's very data intensive, in fact we've managed to get quite a lot of data. The Department of Immigration and Border Protection has been undergoing a large change, as many of you will have seen. It's moved from an immigration culture to a border protection culture and as such there's been a change in the dynamics of the organisation, but they've been increasing integration of data sets. For example, the Australian Bureau of Statistics under the new statistician David Kalish has been integrating DIPD data, which is quite good. Australian migration data is quite sophisticated with tax data and that will help inform our enquiry.
Similarly we're getting some good data from Canada, which is a very close country in terms of the way in which immigration is managed. As opposed to say, the United States. So we can talk about the international evidence in a second and we are, as well as showing this evidence as we're – in our report, we're also doing some modelling work. Two lots of models in particular, I need to emphasise that models are not, they're not b-all end-all they're just something to help inform the analysis. You shouldn't put too much faith in a model. I used to do modelling at treasury for forecasting and all they are is, whatever the methodology that is used and the assumptions that are made.
But as long as the methodology is reasonable and the assumptions are reasonable. And we publish all of that and other people can criticise us for that. Then it's a useful piece of information. The general equilibrium modelling would be used to assess the overall economic impact of migration, the costs and benefits to the extent that we can model it and we'll talk about the parts that we can't model obviously, as opposed to a partial equilibrium modelling. Which is being conducted here in our team in Melbourne, which about this charging option, which would be a major change in the way in which, the quota is allocated.
And I should say, before I go on, that in terms of that pricing system, the government has already said that it's not entirely favourably disposed to it. But we've been asked to look at it and at this stage I'm not going to say whether we think it's a good idea or not. Or what variations there might be to it. But we will give it a fair look. What we've tried to do is use a framework to inform our analysis. I'm not sure; can you all see this chart here? It's, if you'd imagine what are the types of drivers of migration, prior to the 20th century I think it would be fair to say that, to go back to the ancient world. That it was war and famine would drive migration. Not economic circumstances per se, people didn't migrate to get a higher standard of living in the ancient world.
But from the 20th century I think there's still a war and famine driver of course, but there's been increasingly an income differential that drives migration. And there's another part of that and that's the diaspora. So a whole lot of Greek migrants came to Melbourne, it makes it easier for a potential Greek migrant to come to Melbourne because there's a community in which can assist that person to integrate into the society and find his or her way, or family's way. So from a country that has never migrated to Australia for example, it's difficult to be the first migrant. Obviously when there's been a large number in the past, it becomes progressively easier. So those two factors I think are important to explaining the movement of people from one country to another. And of course the trends change over time, we've had a lot of migration from New Zealand and now some migrants are going back to New Zealand. And perhaps it's due to different economic issues and there are other things to it. So we've tried to analyse it as you can see with the push and pull factors. But I think I tried to – the income differential is a large part of that. And people are going – migrating a lot to better their lives. And whether they take a good decision or not, well that's another matter but that's the objective.
It is interesting also, not only is that an important factor of migration but it is now obviously a lot easier to maintain ones contact with the source country. With technology being as it is. And if you can imagine in the early 20th century when people had to hop on a ship for a you know, six week journey from Europe to Australia with little prospect of ever returning. And not knowing much about Australia it would've been an incredibly difficult decision to make. So today it's not as difficult to take that decision so the costs of moving have reduced quite a bit.
As I mentioned we're not just focussing on economic issues in this enquiry. It's important to look at the social and environmental parts. Not only the parts that can be measured but the parts that are not measurable. What you might call the intangibles. And they are important and it's very easy for economists or any analysts to focus on what's measurable and ignore the things that might be even more important that are not measurable. So we are going to try and incorporate that the best we can in our overall approach. It's, so for example if you look at social and Alison will speak a bit more about this later. It's social cohesion and trust and so forth.
Environmental issues, such as congestion, land fill, climate change issues and so on are all part of the environmental impact. And economic, of course the economic impact on the migrant himself or herself. As well as to the community. In fact you could see, there are three party's affected by migration. The source country, the destination country and the immigrant. And each of them has different impacts upon themselves. So, you know, if large numbers of highly skilled people leave from a source country to a destination country, that source country can be depleted. It's I think what Bhagwati used to call it, we should have a brain drain tax to repatriate some money to the source country. Remittances are important there by the way. Although there is some debate about how it's measured. In fact the World Bank suggests that the actual measures of it might be slightly or quite a lot exaggerated.
And also things such as anti-money laundering and counter terrorist and financing have raised the cost of remittances. But I think remittances have been important for people from poorer countries coming to Australia to help send some of the wealth or the extra income they've earned by coming to a country like Australia back to the source country. Some trends that have been quite evident over the last 10 or 20 years has of course, it's become more temporary. And that's not surprising, people now, highly skilled people in particular are more mobile. So they might forge a career for a year or two in one country and then go to another country.
People often have multiple citizenships, that's been true in the past to some extent. But I think it's even more true today. It's interesting for example, I'm not sure if you're aware that the United States is one of the few countries where citizenship is given by where the actual territory of birth. As a person at the US Embassy told me, if you happen to be born on a plane that was over the territory of the United States, that baby would be a US citizen by definition. Irrespective of parentage. And that's quite unique, America in that respect, compared to other countries.
The people, as it says here, are moving multiple times. I think that's important to remember, so I think allowing multiple citizenship and there's been a bit of debate about that, is important. Because it allows people to set up roots in Australia as well as go overseas and perhaps return. Some countries don't allow multiple citizenship, Japan, Singapore, Germany and a number of others. So there are probably advantages in allowing multiple citizenship as Australia, United States, UK, France et cetera all do.
The way in which students are moving has also been quite dramatic. In 2000 I think there were two million students that had moved across country around the world. And today, sorry, in 2012 there are four million. So it's doubled in the space of 10 to 12 years. And I don't expect that that will decrease. Students are finding it valuable for their own development to study overseas. Either for part of their education or entirely for their entire course. And forced migration and refugees, the numbers in the world have increased. The UNHCR reported that the number of displaced people in 2014 was the highest since World War II. So it's been a dramatic change there too.
And I mentioned remittances so, let me go to this new chart. I think that Luxemburg, population 450,000 should be considered a bit of an outlier but Australia and Switzerland also surprises me to some extent. Australia has a very high percentage of immigrants as you can see in this, as a percentage of our population, about a third. And it's actually increased from 2000 – 2001 to the present. Whereas say, Israel there's been emigration, it's fallen in that period so it's quite interesting how the stats as you can see, going down to the migration and the per cent of migrants in the country, varies quite dramatically. But Australia is way up the top there and as I say, I would discount Luxembourg for a number of reasons, given its small population and it's European migration of course.
It's about, as well as the 30 odd per cent there of immigrants in Australia, another 20 per cent of population are Australian born but have at least one parent that was born overseas. So this is a very large, effectively half the population. And as I was saying before about difference of migration, the green line is natural increase, so birth less deaths and here's net overseas migration. In other words, immigration less emigration and as you can see, from about here, it's now much greater than the natural fertility increase so we can now say that immigration is definitely driving population growth. And perhaps we might be able to publish, we've go somebody to do the analysis if you change the fertility rate and the death rate and you change the net overseas migration. You can project forward about a population fairly easily.
I think about 2005 it broke, it became the major driver. I also said that temporary has grown proportionate to permanent. And the green bars at the bottom, the dark green are permanent migration to Australia. The blue is temporary and the light green is other, which includes citizens of Australia returning, it includes New Zealanders coming to Australia. So you can see that part there but, the key thing is that the temporary – I think to me, the thing to remember about temporary is that it's a – if you could look at the temporary streams, 457 skilled visas, working holiday makers, the seasonal workers and the international students.
The four primary ones, they are very tailored to the economic environment. So I tend to go up and down quite closely to the economic circumstance. Which I think is pretty understandable. If we have a strong economy, people will come and try and seek, your mining companies employ 457 workers for example. The quota is set for the permanent intake. The government sets them by no particular science, but by an analysis of what they think is an appropriate level. They've, if you went back to the 90s they were a lot lower than the levels here. But they've increased now, to about, you know 100,000 or a bit less.
So and then one of the questions we have to consider is not only is temporary volatile to the economic cycle but should – I haven't resolved this yet – should the permanent intake also be more variable to the economic cycle or should it be more static. It's an interesting question. And here's the humanitarian program. We have the parts here, these – that are all about offshore processing. The on-shore processing being the black bars. The thing that's quite malleable about this is the relative growth of the special humanitarian program, relative to the refugee. The refugee being assessed by the UNHCR. The special humanitarian program effectively being decided by government.
That's grown quite a lot compared to the refugee intake and overall the numbers in terms of per cent of the total intake is this line here. Which I think was around about before '85, peaked at about, sorry about 20 per cent is now about, I don't know, about seven per cent I guess, looking at that bar, that line. So it is true to say that that as a per cent of our total intake has declined but that's because we've had a large increase in the permanent intake. But also when you look at the special humanitarian program and I think it was Glen Withers who told – made this point is that true, Alison about, that he was arguing that our system has become progressively more skills based. And that the special humanitarian program tends to be higher skills on average than the refugee intake. So that's an interesting bit of information. And I think that was when I'm handing over to Alison.
So I'm going to take us to the next slide which fills out a bit what Paul was saying. That's looking at our permanent immigration program and how the various categories have changed over the years and so what it's showing that the increase really in that program has been in the skills - the skills area which has increased both in numbers and in proportion. So we've got therefore the family program and the humanitarian declining as propulsion of the program with the skills on - increasing and compared say with the family program on average skilled - people who come under the skilled program are younger. They have better English. As you would expect they're more qualified. They have better employment when they come here. They're more - less - more likely in the labour force. Employed. They're more likely to work in high skilled jobs and earn more.
So one of the other things to thing about is this link between - so we you know we're looking over time. We've had these changes. We've had this change. This move to temporary. This move to skills. This move away from family and humanitarian and when we think about that this slide is sort of saying who's really - who's really moving this.
One of these things we want to think about is who goes from temporary to permanent? One of the big changes is a lot of the people who become permanent immigrants in this country are - become so because they've been a temporary. A temporary immigrant. A 457 and a student in particular. They're the main ones. There are others as well. But they're the critical ones. So I think that GSM - that GSM is graduate student isn't it? Graduate student. 'Cause they've also been students. So a lot of them have been students and so what they're telling us is that - that they're the ones that are becoming permanent. But also that there's a fairly strong still focus on family with that trend. They're I think the major messages from that slide.
So when people come in as temporary they're generally not always coming in as just individuals. 457s are often bringing their families with them. So temporary is not just individual permanent family. It's a bit more mixed than that.
Now as Paul said one of the things that we really have to think about when we're looking at both the temporary and the permanent programs and how well they're operating is how - what are their social impacts? And when we think about social impacts I guess we're still pulling together the information about this. It's still preliminary what we can say. But we think about it in terms of how well people integrate into Australia. You know how much they're part of the Australian society in various ways you know and whether they consider themselves part of the Australian society and whether Australians consider themselves part - consider them to be part and related to that is the idea of social cohesion. You know whether immigration does change the bonds we have between each other. Whether that's the close bonds or the more disparate bonds that different groups have together.
I know you guys know more about social capital and social cohesion probably than we do but you know we need to think about it in those terms and you know I'm - at the moment we can say and you know the experts who we talk to have told us this that we do pretty well in terms of social integration in Australia you know and this slide has one of those - you know has a couple of those indicators. But we're pulling together more than that and I think what we are clear about is that the critical drivers are English-speaking capacity when you come. You know people having English speaking capacity when they come to Australia. Their level of education. You know and that influences both. That third bit whether they get a job. Critical. Critical for social integration whether they can get a job and that will be also be influenced by education. But education also influences a lot of other things, as you know. Whether you can you know sort of understand what's happening. You know whether you can interact and so on. So education is important in another way and so that's very much influenced by who we come in. Which is why we have to think very carefully about our intake 'cause it impacts on integration.
But the other factors that affect integration are how well our institutions work. How well our schools work. How well our labour market works. How well our infrastructure works and we got that. We've - looking at that. But also the particular settlement services we have you know. Do they help people? Do they give people the help that they need when they're coming in? Are they sufficiently targeted? Are there people that are missing out? And we're keen to sort of look at that in some detail. I don't know whether you know your longitudinal studies are showing anything about that.
The other thing that does influence - I think I've gone - I'm - I think - have I gone too fast? Sorry I'm just - it's all right I'm just - I'm - you're - my slides are not quite the same. But I think this slide is really telling a very important story about Australia's social integration, which is not only that, does - while the right hand side. Right hand side? That's this part of the slide is telling us that immigration - when you come in your labour market prospects aren't quite as good as Australians you know. You're less likely to be in the labour force and you are a bit more likely to be unemployed.
However when we compare Australia with other countries our immigrants still do better in terms of their - how they're going in employment and importantly this other slide is telling - this other bit of the slide is telling us that the second generation does particularly well and that's you know and that's really important. That's telling us that they are - they are dealing - they're doing well because we - probably because their parents are getting jobs and getting - are helping out. But also because our schools are working well and I think you know it might be 'cause of the expectations of parents for education. But that is a very important part of Australia's story in terms of social integration. Really how our second - our second generation perform. So we do pretty well.
Also the other thing that's quite important is where people settle and as this slide is telling us one of the things that is - does happen that in contrast with Australians is immigrants tend to go more to larger cities and they - more in Melbourne and Sydney and more in the urban areas generally. So 80 per cent of immigrants live in the major cities as compared with 65 per cent of Australian born and there is some - and they - when they're in the cities they like to be in the inner areas and near the universities and of course near the universities is probably because of our large student temporary population. That's just telling us who they are as much as anything else. You know they're there to go to universities or attend other institutions. There's also some evidence of geographic clustering.
Now we've got to do a bit more about the settlement patterns because one of the things we are interested in exploring is how where people go might effect the environment and effect our demand for infrastructure. So that's something that we're looking at quite closely. We were told by some of the people that we talked to that one of the reasons why Australia does do well in integration is because while immigrants might initially cluster in certain areas they tend to not to stay there for generations. So you don't have successive generation after generation after generation living in the one area and that can help social cohesion. But we haven't - we've got to see - one of the issues around that is having the data to be able to track people longitudinally and where the different generations have gone and that's pretty hard to work out.
One of the things that we do know that's really, really important for how people can settle in a new country is whether they can have their families with them and whether they can bring their families in and so one of the things we are looking at is what's happening with the family reunion category of that total permanent migration. I showed you that earlier slide which showed the decline. One of the things is that the family migration levels are capped at various points through - and so family reunion is sort of allocated through some sort of capping and queuing priority process.
Some of our family visas can't be capped and they include partner, child, orphan, relative and adoption and what we do is prioritise different groups in the family reunion category with particularly child and partners are prioritised first and contributing parents next and I'll say a little bit more about that in a minute. But it's true that the demand for family visas and - is higher than we've been able to allocate each year and you know when we're thinking about having - you know one of the benefits of having our skilled migration program is we know that it's made a big economic contribution to Australia and it's helped people settle because they can get jobs and that's also associated with the fact that we have an employer based program too particularly through the temporary but also through the permanent.
So a lot of people come here because they have already had a job that helps them a lot. But also if we're thinking about how we maintain a skilled population we still have to think about that balance between family reunion and skill because it is clear that the ability to bring in a family is going to influence whether I as a skilled migrant either on temporary or permanent and particularly on permanent is going to be able to come to Australia. So it's something that we do have to - we have to do - think about and many of them are families anyway because as I said some of the - many of the temporary workers already are bringing in their families and this is just showing us that the people - many of the people who transfer from the temporary program, the 457 are actually family members.
Now I mentioned that - oh yes so one of the problems - one of the implications of this - the fact that you know the family reunion scheme has been - is reduced in percentage is a lot of the - the processing times for some of them are very - are very long and therefore people are having to wait for a - particularly long. Now you can see there they're probably not waiting a lot for the child and the spouse. They - you know. But they're waiting a long time if you're a parent. Yes a parent. And older parent. You're waiting over five years you know. In fact it's decades isn't it. It's decades.
Very old by the time they get - - -
Yeah. Unless you are a contributing parent in which case you pay 40,000 - 47,000 to bring your parent in and therefore you get in quickly. So one of the issues is it's a very interesting case study actually and it would be in a sense if we did - when we're looking at the charge which as Paul said is part of our study that we have to look at it makes an interesting case study about you know how the charge might work. Because you know we've got the parents split into contributing and non-contributing with some people coming quicker and so you know do we want to do this more generally with people? You know there's this - you know it's - it pauses us to think about that and through this slide really - sorry. I gave you the wrong one. I'm having trouble seeing. Did you - could you see it? 'Cause I've got the light on.
Yeah and so yes so that's how it's an interesting case study. So when we're thinking about charging we had quite a few different views. On the whole I have to say the views that we got from people who sent in submissions and we talked about weren't very positive about us replacing our current intake with a charge. But there were some that were. There were some that were and one of the - and this the Liberal democrat view is, "Well you know our government's very good at determining who we're - come in. Are they very good at allocating what skills we need? No they're not very good at that so we're better to do it through a price." You know so that's you know the view in the top one.
As opposed to people who are saying, "But you know the way we bring people in now it's really worked for us. You know it's given us economic benefits. You know it's skill based and we've got some family - why would we change that?" That's really the second and then there's also the concern that if we have a charge what will it do to the position of people who come in? And to the nature of our Australian society?
So there are very, very different views about the charge that we are considering as well as doing the modelling that Paul talked about in terms of the impact of the charge in the costs and benefits and a lot of that is going to be through our assessment about how it might change the composition of the migrants that come given that it's the composition of migration that make - as well as what we do to migrants and how we help them come that makes the big difference to what it does to our economy and what it does to our society.
So what we - we're at the moment really doing all the - doing - finalising the analysis and writing up our extensive report. The chapters. We anticipate releasing our draft report in mid November and then we will go through the process of consultation and do further analysis on areas that we think we still need to do some more work on and it will probably include the modelling and we'll have public hearings in early to mid December. Take submissions until 18 December and we have to give our final - we're required to give the final report to the government in mid March. Thanks very much.