Each year’s intake of parents of migrants will cost taxpayers up to $3.2 billion, and permanent visas for them should be abolished or the fees greatly increased, says the Productivity Commission in a report that slams current policy for lacking an overall population plan.
The commission says permanent residency for parents should be provided only in extreme, compassionate circumstances and recommends a new temporary parent visa that would make the children or the parents themselves responsible for covering health and welfare costs.
While acknowledging that migration is good for both the economy and the budget, and has broad social acceptance, the commission says there are too many loopholes that allow people with inadequate skills and English language to gain permanent residency.
Migrants make the greatest overall contribution when they arrive at the age of about 25 years. Skilled visa holders still deliver a boost to the budget if they arrive before the age of 40 years. Parents, by contrast, carry by far the highest cost to the economy.
There are two schemes for parents of migrants. One involves a relatively low fee of $7000 and has a waiting period of more than 30 years while the other is supposed to contribute to the costs and is set at about $47,000.
The Productivity Commission says this does not come close to covering the real cost to the taxpayer of a parent visa, which it estimates at between $335,000 and $410,000 after health, welfare and aged-care costs are counted.
With about 8700 parents coming in under both schemes each year, that adds up to between $2.6bn and $3.2bn over a lifetime (after allowing for inflation).
“Given that there is a new inflow each year, the accumulated taxpayer liabilities become very large over time. This is a high cost for a relatively small group,” the report says.
Although it is claimed grandparents contribute to childcare, the commission says this is the case for only a minority of parent visas and, in any event, reduces the cost more for the family than the taxpayer.
The report says migrants have increased their share of the population from 23 per cent to 28 per cent in the past 15 years, while a further 21 per cent has at least one foreign-born parent.
Source: Productivity Commission report
Big impact on population growth
The report says the size of the annual intake has a big impact on population growth. Australia’s population would double to almost 50 million people by 2060 if the migration rate over the past decade of about 1 per cent a year were maintained. If migration dropped back to the long-term average of 0.6 per cent a year, the population would be 40 million by 2060.
At the moment, the annual permanent migration intake is set by the Department of Immigration after a consultation looking at skill shortages and the needs for family reunion.
It says there should be a formal population policy setting out the government’s long-term goals for population growth that would include the impact of both permanent and temporary migration on social cohesion, the environment and the economy.
Ideally, it would be reviewed every five years along with the Inter-Generational Report.
