When borders reopen, Australia has a chance to reshape its migrant policy, with an opportunity to target younger, more skilled workers, a think tank has revealed.
Australia is not attracting the right migrants, instead it should focus on simplifying the process, taking in younger skilled workers, and paying them more money.
According to the Grattan Institute, Australia’s migration policy has gone in the wrong direction in recent years, calling for the abolishment of the Business Investment and Innovation Program.
Instead, Grattan Institute said Australia should heavily increase the number of visas given to skilled workers, which they state would increase total taxes paid over the lifetime of migrants by $4 billion each yearly intake.
Grattan Institute’s economics policy director, Brendan Coates, said that when we reopen the borders, Australia should unashamedly select permanent skilled migrants for their long-term economic potential.
“Skilled migrants tend to be younger, have more skills, and earn higher incomes than the typical Australian – so they generate a fiscal dividend for Australians because they pay more in taxes than they receive in public services and benefits over their lifetimes,” he said.
He also noted that the Business Investment and Innovation Program, or BIIP, visa-holders bring fewer benefits through other income streams due to being older and earning less income while in Australia.
“The new Global Talent Program, which was being expanded rapidly before the pandemic, should be scaled back while its value is assessed,” Mr Coates said.
“The number of skilled worker visas – allocated via employer sponsorship and the points test – should be expanded.”
“Employer sponsorship should be available for workers in all occupations, provided they earn above median full-time earnings of $80,000 a year.”
Venture Capitalist call for foreign investment
While the Grattan Institute argues for less skilled migrants, the venture capital sector highlights the key role migration plays in helping boost the economy.
Stoic Venture Capital partner Geoff Waring welcomed the Australian government’s proposed review of the tax treatment of venture capital funds as a key measure to help lift the nation’s economy and global competitiveness amid COVID-19, announced during the budget.
“We look forward to consulting with the Australian government to identify how we can enhance Australia’s incentives for investment in venture capital,” Dr Waring said.
“That includes providing supportive tax and investment incentives for migrant investors who contribute significantly to Australia’s venture capital industry.”
Dr Waring said the Business Innovation and Investment Program, including the Significant Investor Visa (SIV), Investor Visa and Premium Investor Visa programs, could be the driving force behind Australia’s ailing venture capital sector.
The SIV has already contributed almost $12 billion in investment to Australia so far.
“Wealthy migrants such as prominent businesspeople from Hong Kong have unique expertise and are keen to bring their capital and talent to a new home,” he noted.
“Skills and experience across a diversity of sectors will help Australia innovate and ensure the nation is prepared to respond to future crises like COVID-19 and the health and economic challenges these pose to our communities.”