Permanent visas - 457s and Government policy

[Alan Collett]

Musing on why the Australian Government now appears to preference general skilled visas (subclasses 189, 190, 489) over the permanent employer sponsored visas (subclasses 186 and 187).

The former do not have a guarantee of employment in Australia, and often have difficulty securing a position in their skilled occupation.

The latter are already working in Australia, and are paying income tax.

Surely the better outcome for Australia is a skilled migrant who is employed and is paying tax?

Is it simply that Government can't prosecute the case adequately with the Australian people?

Or are we going to see a scaling back in the general skilled visa program in the next few weeks (eg a raised points threshold)?

We live in relatively uncertain times.

Best regards.

[NicF]

There is probably an element of the political and the fact that there has been a lot of reporting recently about the abuse of 457 visas.  Ditching them though is ridiculous as it's not going to stop the people that were abusing them from abusing the new visas instead.  They could have reduced the lists of eligible occupations without changing anything else about the visa, but that wouldn't had quite such a political impact.  If they really wanted to stop abuse they could have introduced further checks and controls rather than ditching the visa.  It's all to make the government look like they are doing something to help the average Australian get a job.  Maybe an attack on skilled visas will be next.

[Alan Collett]

5 minutes ago, NicF said:

There is probably an element of the political and the fact that there has been a lot of reporting recently about the abuse of 457 visas.  Ditching them though is ridiculous as it's not going to stop the people that were abusing them from abusing the new visas instead.  They could have reduced the lists of eligible occupations without changing anything else about the visa, but that wouldn't had quite such a political impact.  If they really wanted to stop abuse they could have introduced further checks and controls rather than ditching the visa.  It's all to make the government look like they are doing something to help the average Australian get a job.  Maybe an attack on skilled visas will be next.

Yes, the issue with the rorting of the 457 program is - IMHO - more an issue of compliance, and a failure on the part of the DIBP to tackle abuses.

Why can't the Australian Government lead public opinion, rather than be a slave to opinion polls (says he, despairingly) ...

Onwards!

[VERYSTORMY]

There are a fairly big bag of issues that need to be addressed. One is the potential that employers are using the 457 to bring in staff that could be found locally, but the 457 allows them to pay less. For example, there were several posts a couple of years ago from people being offered sponsorship as heavy diesel fitters in Kalgoorlie. There are no shortage of unemployed heavy fitters in Kal, but there are not many willing to work for the $50k being offered!

There are though as well, a big bag of questions about regional needs. As someone that has spent a lot of time in regional Australia in every thing from living in Mandurah to working in some of the smallest and most remote places, I have big doubts about the real demand for people in them. There is demand for some occupations which they cant fill, such as schools in some struggle to get teachers and other similar occupations, but in many cases there is also a lot of unemployment and occupations which could be filled by training locals.

The 457 / 186 / 187 has its place - I arrived in Oz on a 457 and then a 186. But, it is abused by some and employers need to train staff and invest more in that than saying they cant find someone as say a retail manager so they need to hire from international.  

[Alan Collett]

Controversially: having scaled back the list of occupations (retail managers to be excluded), established the market value salary - which is already required to be more than a threshold minimum level of pay, and required an employer to contribute to training of staff, or a training fund, why shouldn't an employer choose whoever he or she wants to work for the business?

Particularly if the local workforce isn't willing to work for the market rate salary on offer?

Best regards.

 

 

 

[VERYSTORMY]

2 hours ago, Alan Collett said:

Controversially: having scaled back the list of occupations (retail managers to be excluded), established the market value salary - which is already required to be more than a threshold minimum level of pay, and required an employer to contribute to training of staff, or a training fund, why shouldn't an employer choose whoever he or she wants to work for the business?

Particularly if the local workforce isn't willing to work for the market rate salary on offer?

Best regards.

 

 

 

Because bringing in cheap labour to keep the salary rate for an occupation artificially low doesn't help anyone. Businesses think it helps them, but long term it doesn't as a low wage economy means people have less money to spend on the products the same businesses want to sell.

If a business finds that it cant attract staff because people don't want to work for the salary offered, then the business needs to offer more pay. Bringing in people is not the answer.

You also mention taxes and people on 457's paying them. Which assumes that they are a net contributor. But are they? Is a family of say two adults and two kids earning say $60k a year a net contributor? They are paying about $11k a year in tax. Does you think that covers healthcare, education and all the other services that a government provides? For example, the cost to the taxpayer of educating one child in NSW is over $15,000 per year.

[Alan Collett]

But the business has to demonstrate a market rate salary is being offered - so how is that bringing in cheap labour?

I accept that the rigour in assessing the market rate could be improved, but doesn't the market rate salary requirement counter the argument in your first two para's?

Healthcare and education for 457 visa holders: there's a mandatory requirement to maintain health insurance for those who are in Australia on 457s, and in several (most?) States there's a requirement to pay/contribute towards the cost of Government schooling.

Best regards.

[VERYSTORMY]

3 hours ago, Alan Collett said:

But the business has to demonstrate a market rate salary is being offered - so how is that bringing in cheap labour?

I accept that the rigour in assessing the market rate could be improved, but doesn't the market rate salary requirement counter the argument in your first two para's?

Healthcare and education for 457 visa holders: there's a mandatory requirement to maintain health insurance for those who are in Australia on 457s, and in several (most?) States there's a requirement to pay/contribute towards the cost of Government schooling.

Best regards.

I think the interpretation of cheap labour I have is different to yours. For example, if the salary for a IT manager would be $100k. But, by bringing in lots of IT managers the salary can be reduced by supply and demand to 90k, then that is cheap labour.

There is no requirement for a 457 from a country such as the UK with a reciprocal agreement to maintain health insurance on a 457 and many do not as I am sure you know as it is a regular question on the forum. Yes, some states charge for education. But nothing like the full cost - WA is $4k per family. NSW is a think $4k per child - but as mentioned the NSW cost of educating a child is a lot more than that and these are only two government services of the hundreds federal government does and which have to be paid for from taxation.  

[Raul Senise]

The proposed changes to the 457 to ENS pathway make absolutely no sense.

The employer nomination scheme is the most successful visa program, as in most cases, the applicants are already working in the role and continue to work in the role and/or occupation after achieving Permanent Residency, thus filling skill shortages.

The skilled program (189/190) in comparison does not have the same success, as many migrants cannot find employment in the occupation they have been nominated in, as they have never been tested in the Australian labour market. You then have the situation where highly qualified migrants take low skilled employment, as they have no other choice. This in my opinion does more damage for Australian job seekers, as competition for non or low skilled jobs increases.

I agree with Alan that rorting of the 457 program is a compliance issue which DIBP already have powers to address. The vast majority of business using the subclass 457 program use it properly to supplement their skilled workforce when required. 

IMHO the latest changes are very much a political move aimed at bolstering support by taking advantage of the general public's ignorance of a highly emotive, complex and misunderstood program. The changes will hurt Australian Business, which in turn will hurt Australian job seekers.

 

 

 

[Beffers]

10 hours ago, Alan Collett said:

But the business has to demonstrate a market rate salary is being offered - so how is that bringing in cheap labour?

I accept that the rigour in assessing the market rate could be improved, but doesn't the market rate salary requirement counter the argument in your first two para's?

Healthcare and education for 457 visa holders: there's a mandatory requirement to maintain health insurance for those who are in Australia on 457s, and in several (most?) States there's a requirement to pay/contribute towards the cost of Government schooling.

Best regards.

Is there really a mandatory requirement for 457s to have health insurance? I know of people who have cancelled their health insurance as soon as they are onshore? Interesting...

[MaggieMay24]

Perhaps the change in immigration policy needs to be coupled with a change in welfare benefits.  If the government made it more difficult for unemployed, able-bodied residents to sit on their butts and collect dole payments, there may be a shift away from needing to bring in foreign workers.

[Alan Collett]

1 hour ago, Beffers said:

Is there really a mandatory requirement for 457s to have health insurance? I know of people who have cancelled their health insurance as soon as they are onshore? Interesting...

Reciprocal Health Care arrangements for UK citizens satisfy the requirement for private health insurance.

Best regards.

[Alan Collett]

8 hours ago, VERYSTORMY said:

I think the interpretation of cheap labour I have is different to yours. For example, if the salary for a IT manager would be $100k. But, by bringing in lots of IT managers the salary can be reduced by supply and demand to 90k, then that is cheap labour.

There is no requirement for a 457 from a country such as the UK with a reciprocal agreement to maintain health insurance on a 457 and many do not as I am sure you know as it is a regular question on the forum. Yes, some states charge for education. But nothing like the full cost - WA is $4k per family. NSW is a think $4k per child - but as mentioned the NSW cost of educating a child is a lot more than that and these are only two government services of the hundreds federal government does and which have to be paid for from taxation.  

I very much doubt that the influence of a 457 visa applicant (or even a number of 457 visa holders in the same occupation) will have the level of downward pressure on salaries with the order of magnitude which you are suggesting.

Agreed about UK citizens and health cover.   Noted re education costs.

However, what the Government has done is to throw the baby out with the bath water.   If visa holders having RHCA is the problem require all 457 visa holders to have private health cover irrespective of the availability of cover through a RHCA.

If education costs for dependent 457 visa holders is an issue require all to pay for education costs - or increase Visa Application Charges.

There has to be a more well thought through strategy than what has been presented so far.   Surely ...

Best regards.

[Guest263228]

1 hour ago, MaggieMay24 said:

Perhaps the change in immigration policy needs to be coupled with a change in welfare benefits.  If the government made it more difficult for unemployed, able-bodied residents to sit on their butts and collect dole payments, there may be a shift away from needing to bring in foreign workers.

Don't see the two as being very relevant myself, but often aired by certain folk in time of economic downturn. Few can afford to sit on their butts, as you put it in modern day Australia, and expect to pay the rent, mortgage and provide food on the table.

This argument is as old as the hills are extremely ill founded. The argument should be to train people to undertake positions now over taken by 457's, but hardly just that category. With not far short of two million in Australia, on one sort or another temp/study visa (from mid 16 figures)there are ample numbers of people out there than local based workers, whom will perform the most manual of chores.

  

[Alan Collett]

Maybe the 457 program should only have ANZSCO Groups 1 and 2, with a minimum salary requirement of (say) $150k?

Best regards.