A new Grattan Institute report titled It all adds up: reforming points-tested visas shows that points tested visas are not working as well as they should, and Australia should reform the system to select the most skilled migrants for the limited number of permanent skilled visas that are on offer each year.
On current trends Australia will offer around 800,000 points tested visas over the next decade but the points test does not reward the most skilled applicants offering these visas to only those areas where there is deemed to be a skilled worker shortage.
The Grattan Institute says simple reforms would build a more prosperous country. This could start with points tests that would reward the most highly educated applicants and those with strong English language skills. Migrants trained in any highly skilled occupation should be able to apply. The Institute says points visas should be targeted at young, talented people and not used to solve short term skills shortages.
State and reginal points tested visa programs should be abolished and more skilled independent visas offered in their place.
Grattan Institute modelling shows that reforming the points test as they recommend could give an $84 billion boost to Australian government budgets over the next 30 years. A further $87 billion boost could come by replacing state and regional points tested visas with just one single points tested visa program. That would be a boost of $171 billion over the next three decades.
Recommendations by the Grattan Institute are:
1. Reform the points test
Change the way points are offered based on the applicant’s age.
Offer more points to applicants with higher degrees, excellent English language skills, and/or skilled spouses.
Abolish bonus points for Australian study, regional study, a professional year, and specialist education qualifications.
Offer points for any high-skilled employment experience and especially for high-paying Australian work experience.
Make points-tested visas available to applicants who can satisfy a skills assessment for any skill level 1, 2, or 3 occupations.
Set the minimum points floor for qualifying for a points-tested visa to 300 points.
Guarantee an invitation to apply for a visa to applicants with at least 400 points.
Apply ranked choice selection to the allocation of all permanent points-tested visas.
2. Abolish state and regional points-tested visas
Abolish state and regional points-test visas and expand the number of skilled independent visas granted each year.
State governments should instead invest more in supporting employers, including state government employers, to make use of employer sponsorship to secure the skilled workers they need.
Retain regional employer-sponsored visas, pending the findings of a review.
3. Reform the skills recognition process
The federal government should commission a review of the skills assessment and occupational licensing processes.
4. Invest more in attracting skilled migrants to Australia and supporting them when they arrive. The federal, state, and territory governments should invest more in attracting skilled migrants to choose Australia and helping them settle and thrive in Australia.
5. Strengthen the evidence base for skilled migration
Review the points test regularly, including via an independent analysis of the outcomes of skilled migrants in Australia using linked administrative data.
Boost the analytical resources within the Department of Home Affairs, to better inform migration policy design.
Establish a new body, similar to the UK’s Migration Advisory Committee, to offer independent advice to government on visa policy changes.
Review visa charges every two years.
The Grattan Institute report and their proposed changes to the points tested visas summary are available online
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