Key facts
- Australia is considering deliberately reversing net overseas migration for the first time in its history.
- Past periods of negative net migration occurred during economic collapses, wars, and pandemics, not by design.
- One Nation leader Pauline Hanson proposes cutting temporary migrants by 766,000 over three years to lower rental inflation by 6.5%.
- The Coalition has pledged to reduce net overseas migration to 100,000 per year.
- Experts warn that drastic migration cuts could significantly harm Australia's economy, exports, and government revenue.
- The temporary visa system has grown significantly, leading to an 'underclass' of workers without permanent residency.
Australia is contemplating a significant shift in its immigration policy, considering deliberately reversing net overseas migration for the first time in its history. Historically, periods of more people leaving than arriving have only occurred during severe economic downturns, wars, or pandemics, not as a result of deliberate policy design.
Economist Mark Cully described such a policy as "unprecedented," noting that while governments have cut migration programs in the past, none have attempted to push permanent migration to zero. Even Canada, undergoing a migration "reset," has not seen net migration turn negative.
Pauline Hanson, leader of One Nation, is proposing to engineer negative net migration for three years, arguing this would alleviate housing costs. Her party's economic team estimates that cutting temporary migrants by 766,000 over three years would reduce rental inflation by a total of 6.5%, potentially saving average renters $54 per week. Peter Tulip, chief economist at the Centre for Independent Studies and a co-author of relevant Reserve Bank research, found these forecasts "not implausible and unreasonable" given the scale of the proposed cuts. However, Tulip warned of significant negative economic consequences, including a substantial hit to exports, particularly from the university sector, and a reduction in government revenue, ultimately making the country poorer.
Cully expressed a more dire outlook, suggesting that if deep recessions typically lead to drops in net overseas migration, then deliberately forcing migration negative for an extended period would likely result in a "prolonged economic slump."
The Coalition, in a bid to compete with populist proposals, has also pledged to reduce overseas arrivals. Opposition leader Angus Taylor has committed to slashing net overseas migration to 100,000 a year in the first term if elected, a move described by the Greens as a "race to the bottom" and by experts as the "biggest cut to immigration in the history" of Australia.
Meanwhile, business groups are raising concerns, as Australian employers have become reliant on millions of temporary visa holders for labor, particularly in critical sectors like aged and health care, and agriculture. Experts agree that Australia's migration system has become unbalanced, with a stable permanent intake of 185,000 per year being overwhelmed by an unregulated and uncapped temporary visa system. The proportion of temporary migrants in the total population has more than doubled in the past 15 years, creating what Cully calls an "underclass" of workers without the protections of permanent residency.
Alan Gamlen, director of the ANU's migration hub, argues that the focus on the net overseas migration figure distracts from the real challenge of controlling the temporary visa system. He advocates for a more targeted approach, using a "scalpel, not a bludgeon," to regulate temporary arrivals without crashing the economy. Gamlen also expressed skepticism that One Nation would fully implement its extreme proposals, suggesting it is a political tactic to "talk tough."