Immigration: A Central Issue in the Upcoming Election Campaign
As Australia edges closer to the upcoming election, immigration has emerged as a pivotal policy issue garnering significant attention. The opposition leader, Peter Dutton, has positioned the Coalition government’s immigration strategy at the forefront of its campaign, proposing cuts to the two principal migration programs: permanent migration and net overseas migration. His assertions directly correlate the influx of migrants with escalating housing prices, creating a narrative that resonates with many voters struggling with the cost of living crisis.
“The first and foremost interest in mind is to get young Australians into housing,” Dutton emphasized, framing the debate around young Australians’ access to homeownership.
The Proposal to Reduce Permanent Migration
The Coalition’s push to reduce the Permanent Migration Program from 185,000 to 140,000 annually is rooted in a desire to alleviate housing pressures. Critics of this approach argue that now is not the ideal time for such drastic reductions. Permanent migration is crucial not only for Australia’s economic vitality but also for addressing the challenges posed by an ageing population.
Interestingly, Labor’s recent budget failed to address the future of the permanent migration numbers, leaving citizens unclear about their plans should they secure re-election. Historically, a migration intake between 160,000 and 220,000 has proven beneficial for the Australian economy, a trend maintained from the Gillard government to the present day. The proposed cut, however, raises red flags as it threatens to exacerbate existing pressures in certain visa categories, particularly the Family stream for partners and children and the Employer Sponsored stream.
The Pressure on Visa Categories
Peter Dutton’s plan is likely to face backlash due to the overwhelming demand in specific family visa categories, which are approached on a demand-driven basis. Reports indicate that applications from family members of Australian citizens could reach as high as 110,000 by June 30. This figure is rooted in legal rights under the Migration Act, which affirms a family’s entitlement to permanent residency.
Moreover, the Employer Sponsored stream is also grappling with mounting pressure, as employers are increasingly relying on this category to fill significant labor shortages. The Coalition’s proposed cuts do not provide clear answers on which categories would potentially be affected, leaving many employers worried about their ability to secure necessary workforce talent.
The Effect on Housing
Despite Dutton’s connection between immigration cuts and housing relief, the reality is more complex. Recent statistics suggest that around 60% of those granted permanent residency already reside in Australia. Therefore, reducing the overall intake may have a minimal effect on housing demand since these individuals are not adding to the overall population influx.
Scrutinizing Net Overseas Migration
The net overseas migration category, which primarily includes temporary residents, skilled workers, and international students, is projected to see 260,000 migrants by 2025-26 as estimated by Treasury. Dutton’s intention to slash this number by 100,000 immediately raises eyebrows, as achieving such reductions isn’t feasible on short notice. Although the arrival of new migrants can affect rental demand, especially near universities and public transport hubs, the reality of departures will prove far more challenging.
Following the COVID-19 border closures, there has been a notable stagnation in departures, with most temporary migrants holding valid visas until at least mid-2027. Thus, the timeline for achieving such immigration reductions is unrealistic, and the assertion that net migration significantly impacts housing affordability lacks supporting data.
Assessing Localized Rental Demand
While new temporary migrants can affect local rental markets, the demand often remains concentrated around specific areas. According to census data, a sizable portion—30-40%—of international students and working holidaymakers tend to find housing in specialized arrangements or share accommodations, thereby diluting their impact on broader housing demand.
Beyond the Election: Underlying Migration Issues
Australia contends with a severe shortage of construction workers, estimated at around 130,000. While both major political parties recognize the need to boost apprentice numbers, the apprenticeship process is notably slow, unlikely to meet urgent demands. To address this shortfall, a more proactive approach to bringing skilled tradies from overseas is essential, but current immigration policies hinder such strategies.
Another critical issue lies in managing individuals who remain in Australia after exhausting their visa options. Currently, over 92,000 people lack final protection and continue to remain in the country—a problem exacerbated by previous governments and still unresolved under Labor’s tenure.
The Need for Thoughtful Policy Over Political Rhetoric
The current electoral discourse surrounding net overseas migration often descends into panic rather than practical solutions, clouding the true challenges facing Australian migration policy. While both parties commendably avoid racial overtones or xenophobia in their debates, the tendency to scapegoat immigration has emerged as a distraction from substantive policy discussions required to address the real issues hindering the migration system.
By focusing solely on immigration numbers, politicians deter attention from the more complex factors affecting housing and labor markets. A paradigm shift in policy direction is necessary—one that embraces evidence-based strategies rather than populist narratives that simplify the multifaceted nature of immigration and its economic ramifications.
