News & Update

Description

The recommendations by the Grattan Institute proposes substantial reforms to Australia’s points-tested visa system to enhance its effectiveness in selecting skilled migrants. The goal is to better predict and prioritise migrants’ long-term success and economic contribution to Australia.

Key Issues with Current Points-Tested Visas

1. Misaligned Points Allocation:
   • Current Allocation: Points are awarded for a variety of factors including regional and Australian study, professional years, and length of experience.
   • Issue: These factors often do not correlate strongly with long- term economic success and leave many migrants in visa limbo.
2. Complexity and Duplication:
   • State and Regional Visas: Separate streams for state/territory and regional visas add complexity and duplication.
   • Earnings Impact: Visa-holders under these streams generally earn less than other skilled migrants, suggesting inefficiency in these programs.
3. Focus on Short-Term Needs:
   • Short-Term vs. Long-Term: The current system sometimes prioritises short-term skills shortages over long-term economic potential, which may not be optimal for long-term national benefits.

Proposed Reforms

1. Recalibrating the Points Test:
   • Skill and Economic Contribution: The points test should prioritise skills and attributes that predict long-term success and economic contribution.
   • Removing Unnecessary Points: Points for regional study, professional years, and mere length of experience should be reconsidered or removed.
2. Streamlining Visa Categories:
   • Consolidation: Merge state/territory and regional points-tested visa streams into a single points-tested visa.
   • Efficiency: This would reduce duplication, simplify the system, and eliminate the lower-earning outcomes associated with current state and regional visas.
3. Adjusting Points for Key Characteristics:
   • English Proficiency: Increase the weight of English language proficiency in the points system.
   • Education and Experience: Focus on the quality of education and relevant skilled work experience rather than the mere duration.
   • High-Wage Experience: Allocate more points for high-paying work experience in Australia.
4. Addressing Partner Skills:
   • Greater Weighting: Increase points for partner skills, reflecting their significant impact on overall migrant success.
5. Broader Occupation Inclusion:
   • Open to High-Skilled Occupations: Ensure the points-tested visas are available to all high-skilled occupations, not just those in short-term demand.

Expected Outcomes

1. Economic Benefits:
   • Fiscal Boost: The reforms are projected to boost government budgets by $171 billion over three decades.
   • Productivity Growth: Enhanced selection criteria should lead to faster productivity growth, leveraging the skills of high-caliber migrants.
2. Reducing Visa Limbo:
   • Fewer Temporary Holders: By streamlining the process and criteria, fewer migrants would be stuck in temporary visa limbo.
3. Long-Term Success:
   • Economic Contribution: Migrants selected under the reformed system are likely to have a higher long-term economic contribution.
   • Productivity Spillovers: High-skilled migrants can drive productivity spillovers, benefiting the broader economy and labor market.

Conclusion

Reforming the points-tested visa system to prioritise long-term economic potential and streamline processes will significantly benefit Australia’s economy. By focusing on key predictors of success and reducing bureaucratic complexities, the proposed changes aim to optimise the skilled migration program for sustained national growth.

Here is a table outlining the proposed points system as per the recommendations:

Category	Criteria	Points
Age	18-20	95
	21-29	100
	30	95
	31	90
	32	85
	33	80
	34	75
	35	70
	36	60
	37	55
	38	50
	39	45
	40	35
	41	30
	42	20
	43	10
	44	5
	45	0
English	Excellent (IELTS 8+)	90
	Very good (IELTS 7)	45
	Competent (IELTS 6+)	0 (but needed to be eligible)
Education	PhD	60
	Bachelor’s degree or higher from top- ranked university	45
	Bachelor’s degree or higher	30
	Certificate III and above	15
Skilled Work Experience	Skill level 1 occupation (2 years minimum)	50
	Skill level 2 occupation	15
High-paying Australian Experience	Earning $120,000+ (1 year minimum)	90
	Earning $105,000+	70
	Earning $90,000+	50
	Earning $80,000+	40
	Earning $70,000+	30
Community Language	Proficiency	20
Partner Skills	Single	90
	Partner's English: Excellent (IELTS 8+)	60
	Partner's English: Very good (IELTS 7)	40
	Partner's Education: Bachelor degree or higher	30
	Partner's Education: Certificate III and above	15

Note:

1. The total points available in the new system are 500 points.

2. The proposed system aims to ensure that the points-test better reflects the migrants' long-term economic potential by giving greater weight to factors like English proficiency, skilled work experience, and partner skills.

3. Minimum points to qualify for a points-tested visa are 300, and applicants with at least 400 points should be guaranteed an invitation to apply for a visa.

Reference: https://grattan.edu.au/report/it-all-adds-up-reforming-points-tested-visas/