Address To Catalyst Forum On Temporary Migration
Speeches
Date: 07 May 2008
Senator Chris Evans, Minister for Immigration and Citizenship
Address to Catalyst Forum on Temporary Migration
Sydney, 6 May 2008
The title of the seminar is ‘Economic Opportunities for Whom’ – deliberately provocative – and my topic is ‘Temporary Migration: the Answer to Australia’s Skills Shortage?’
Well, yes it is part of the answer. We absolutely need a temporary skilled migration program but Labor has a different view about how that ought to operate and where it fits in the broader scheme of things.
We have a very firm view that there are capacity constraints to economic growth in this country. It was part of our critique during the election campaign that the failure to invest in our people and our skills and our training; the failure to invest in education; the failure to invest in infrastructure, was holding back the Australian economy. We got very strong support back from business who knew that their capacity to develop and grow was being constrained by their ability to get skilled labour; inability to access training supports and those barriers to their capacity to develop.
Now Labor’s view is that we ought to address that in a number of ways but we start with investment in our own people; we start with investment in skills and training. We ran the election campaign talking about an education revolution and we are dead serious about it.
We have failed in the last 10 to 15 years to invest sufficiently in our own people, in their education and giving them the skills to participate fully in our economy.
And the best answer to the skills crisis in this country is to better invest in our own people and one of the crying shames and scandals of this country is failure to invest in its Indigenous people – and I’ll come to the South Pacific proposals later – but I’m very keen to put the argument that as part of any new approach we’ve got to make sure that we are actually connecting Indigenous people with the employment skills opportunities in this country. They are an untapped source of labour. They are actually located in the regions where we have the most economic growth. It is an opportunity that needs to be seized and I for one, although it is not particularly immigration related, am anxious to help seize it.
I’ve learnt since taking on the job that immigration is all about the economy. This is very central now to the economic debate. I’ve spent most of my time since taking on the job engaged in the economic debate about the capacity constraints, about inflation, about our ability to meet the needs of industry.
I think I’ll come to this later but in a sense, the debate has moved on from a debate about skills to the debate about labour. We are just entering a debate about labour shortage and guest workers in this country.
The debate about temporary migration quite frankly is over. Temporary skilled migration – that’s not to say the issues around it are over, there’s a whole range of issues which I’ll come to – but I think the debate if you look at it now is very much about what we have traditionally seen as semi-skilled or unskilled labour and how Australia reacts to that; and the debate we have about that I think will be interesting but I think that’ll be our focus in the next 12 to 18 months.
I want to give you some perspectives from my point of view as the Minister about what’s going on and I guess my first impression is that the system is creaking at the seams in dealing with the challenges of a modern economy. I think we’ve got a sort of 1960s migration structure that is struggling to cope with the demands that are now placed upon it and, to be frank, the focus in the last 5 to 7 years in migration has been on refugee issues.
It’s taking enormous focus inside the Department; it’s been extremely traumatic for the public servants. It’s been a major migration public policy debate and my first job is to fix up the mess that was inherited from the previous government and to return some humanity to the refugee – the treatment of refugees in this country.
So that’s very much part of my focus as well but I’d like to put that behind us. I’d like to fix those problems and move the debate on. It’s not to escape those issues but I think my job is to actually fix the problems that remain in those areas.
But immigration is very much about supplying the nation with the capacities it needs; with the people it needs; with the skills it needs – and that’s where the debate is moving.
One of the first observations I made about the job was when I was asked to approve the annual migration program. That’s as long as our programming goes – one year. What other organisational system works on the basis of a one year program? That’s the extent of it currently. It seems to me we want a much longer term perspective on migration, skills needs, and plan for those skills needs in conjunction with our planning for skills development education in the country.
So that is something I’m looking to address. The other point is that I think the world has changed and the system hasn’t changed very much. We are in a global labour market. Employers are competing for labour internationally; they are looking for much more responsiveness; looking for people tomorrow not in a year’s time and they are in a market where people say well I can take a job here or I can take a job in Germany or I can take it in Dubai, and it’s a competition about wages, conditions, opportunities.
I think there is a bit of a cultural superiority in Australia that everyone wants to come here to live permanently and to work here, and I think we have got to get over that.
There are people who are competing for jobs and for opportunities throughout the world. A lot of people are quite prepared to live anywhere in pursuit of their careers and opportunities.
The other point I make is that the levers available to the Minister for Immigration are much less effective in that market than they perhaps were in the past. We currently have a program of 108,500 permanent migrations to this country. That is out of 500,000 people who come to this country with work rights each year.
I’m pulling the levers for one fifth of the total coming into the country. The others come in under uncapped schemes so to tell myself that I’m running the system, as some people think, is – as I say – kidding myself.
Unless we are going to cap the student scheme, the working holiday scheme, the temporary migration scheme – those schemes are uncapped; they are progressing meeting demand and so the levers that the government has to pull in those areas, short of putting on caps, are quite limited.
So I just wanted to make those observations because those are the sorts of things that influence what I view and what the public ought to deal with.
Look, it’s a complex debate. We are certainly in need of better research. I see a lot of researchers around the room. Should be good for business in the next couple of years because, quite frankly, I think we are highly under funded and underinvested in research in immigration issues. There is a real lack of opportunity and funding for research and certainly within my own Department I’ve already been very disappointed with its own capacity.
Part of that is us actually releasing information that the Department does hold and I’m keen to have a more open approach to that but quite frankly we need much better information that what we’ve got, and a lot of the information we’ve got doesn’t answer the questions I want answered.
There is a lot of politics in this debate. People, you know, those of us who lived through the Hanson era know that immigration can be used politically to great effect. A lot of people were badly hurt by that debate but I think the reality of this is when unemployment is low the migration debate is easier and when unemployment rises it gets much tougher.
At the moment, we are at very low levels of unemployment so I think the migration debate is arguing for a migration program that is easier. Nevertheless, there is real and appropriate fear of migration undercutting Australia’s wages and conditions. That is a legitimate concern and I think also because the employment market is regional, there are some areas where unemployment is not nearly as low.
There are huge groups in our communities who, like the Indigenous groups, like some people in various outer suburbs of Sydney, who are in need of employment assistance and need of skills opportunities. But, for instance in Perth, my wife told my son to get off his backside for the Christmas holidays: “You’re 16, go get a job rather than sitting around playing the X-Box all Christmas holidays.” He dropped his CV around the local area, came back and there were four phone calls waiting for him. No work experience other than a couple of weeks as a checkout chick and he is now working in a café.
But the labour shortage is so acute they’ll take a warm body in Perth and that’s just the reality. Every shop you walk past has a sign: ‘kitchen hand, waiter, shop assistant – start today.’
And sure, there are issues about wage levels, but quite frankly, a lot of them are paying reasonable rates as well – they can’t get people. It is different in different parts of Australia.
Now some remarks about the 457 program. I was talking to John Sutton on the way in. I think we agree that the 457 visa has all the marketability of Work Choices. It’s got the same branding problem.
The reality is we have seen enormous growth in the 457 system. I think the numbers have doubled since 2003-04 and continue to grow. So the system is under strain because of the rapid growth. Like with everything in rapid growth, you have a range of problems that grow off that.
The second aspect I think is worth noting is that the level of skill of those coming in is changed. The demand traditionally was for professionals, engineers, doctors and nurses. Still the biggest intake has been of health professionals. If it wasn’t for Indian doctors you wouldn’t get any treatment in a Queensland hospital. Quite frankly they are absolutely reliant on – despite all the fuss in Queensland on Indian doctors, they are absolutely reliant on imported medical professionals and they still represent a large part of the program.
But what we’ve seen is increasing demand for people at lower skill levels so you’ve got a changing nature of the program and, to be frank, you’ve got a change in source countries.
Where as traditionally we’ve drawn from Britain, South Africa etc., increasingly we are drawing from non-English speaking countries – China, India, and Korea. So a whole different set of issues arise.
Not just in terms of employment conditions but in terms of the Department. The Department has to check papers, qualifications, those sorts of things. Language barriers, translations – all those issues put strains on the system as well.
Now one of the issues I’m most focused on is the integrity of the scheme. People have quite rightly criticised the 457 scheme because of the well-publicised abuses in some instances and I’m not at all going to claim that that’s somehow media sensationalism.
There is a real problem. It’s not a problem for the majority of people. It is still a problem on a minority of cases but is a serious and real problem. And, as I say, partly brought about by the scheme being designed for another era; partly being brought about by the pressures of growth, the lowering of skill level demands and the changes in source countries
People with no English skills are much more likely to be exploited. People with lower skill levels are more likely to face issues about whether they are getting paid the minimum salary level.
In bringing in an engineer for BHP – do I worry about whether they are paying him enough? No – I know he can get $200,000 anywhere in the world; he’s come in from working in Brazil and is going out to South Africa in two years’ time.
My job as Immigration Minister is to make sure he’s got a visa; he is who he says he is; he’s had a security and health check. In terms of his employment conditions I have very little interest but there is a risk analysis that’s got to be applied that hasn’t been applied previously enough. That confidence about an engineer that works for BHP is not the same as the confidence I have about someone bought in to work in the restaurant and café industry in Australia from a non-English speaking background.
The potential for exploitation, the potential for abuse is much, much higher and all of the Department’s figures reflect that. All of our experiences reflect that and if you look at where the problems are – they’re in the areas where traditionally there are industrial relations problems and where the salaries are lower.
So we’ve seen growth in the areas like manufacturing, agriculture, retail, accommodation and cafés. They are also the areas that are paid much closer to the minimum salary level.
But the point to also remember is they’re actually where the exploitation occurs of Australian workers. These are IR problems as much as they are immigration problems. Exploitation in accommodation and restaurants and cafes didn’t start with immigrant workers. And the same is true with agriculture and manufacturing.
One of the questions for public policy as well is: is the Immigration Department the best person to actually police that role? We are an Immigration Department, not a workplace inspector, and I think there are real issues there about how that’s managed that I’m trying to work through with Julia Gillard.
Now, as I say, the success of the scheme depends on public confidence and its integrity. If the public doesn’t have confidence in the integrity of the temporary skills migration program, it will be seriously undermined and, quite frankly, there would be huge public pressure to end it.
Labor is very committed to continuing the scheme because it is meeting skill demands that are necessary for economic growth and the development of our country.
But the challenge for me is to make sure that it is a scheme of integrity. And there are huge issues involved here brought about by the pressures I’ve spoken about. That’s why I’ve appointed Barbara Deegan, who is a senior Industrial Commissioner from the Federal Commission, to look at all the industrial issues. She is going to work with the working party, which we are about to establish, of unions and employers and others. But her job is to work through these issues that are emerging to provide recommendations to bounce of those people involved in the issues in the industry and to try to work with government to find solutions.
And just to mention a few – English language level. The previous government quickly changed the English language level under pressure quite reactively – it had a huge impact on, for instance, immigration from China where people can’t pass the English test. I’m not sure whether it was intended but it’s had a huge impact. But there is a real issue with the English language – it goes to health and safety. In fact we’ve had an accident within the north west of WA where the allegation is that a couple of workers weren’t able to respond quickly enough to an accident in a big mining construction job and that someone was seriously, well, was killed as a result of their failure to understand health and safety procedures.
It’s an allegation; not sure whether it’s true. There is a coroner’s report etc., but it highlights the problem and, quite frankly, it highlights the public sensitivity about those things, so it is a very important issue.
Increasingly, the question of health insurance. We’ve got a gentleman in South Australia who became a quadriplegic when he dived into a creek. Technically his employer, a small employer, is responsible for his health care – huge issues around that whether: (1) people have insured properly, and (2) whether it is reasonable for a small employer to carry the lifelong responsibility for that worker or is there a role for State and Federal governments? Big issues.
Compliance – the Department has a huge job in terms of compliance as the numbers increase. The MSL, the minimum salary level. I want to make it clear: Labor’s view is that the temporary skilled migration program is not a cheap labour program. It’s a skills enhancement program to build on the skills in our local population to meet the needs of industry on a temporary basis.
So it’s not designed, and will not be used, as a means of reducing wages and conditions and there are real problems with the MSL currently. The problems actually go both ways because of the minimum salary levels some industries can’t attract temporary skilled migration because the actual going wage rate is lower than the MSL.
So not only do they have the costs of transporting somebody in, meeting the other requirements but they actually have to pay a higher wage. So I get complaints from some industries they can’t access the scheme because the going rate, the market rate or the award rate or the EBA rate, is lower, particularly in areas like agriculture, etc.
I have other areas where there is a serious concern, which I share, that the MSL is used to provide a lower wage rate.
But for large sections of the program, it doesn’t worry me. As I say, they are in the mining industry, they are in the professions, etc. The MSL is not a consideration. No one is getting paid the MSL.
But there are other industries where the going rate might be $60,000 where the MSL of $42,000 is applied. That would be something that would undermine public confidence in the scheme.
It is not meant to be a cheap labour scheme. Under Labor it won’t be a cheap labour scheme. But those are the issues we’ve got to grapple with and that’s one of the focuses for us.
Equally, the Department has to lift its game. I made some announcements yesterday about how we operate; being more responsive to industry. But there are some fundamental problems the Department’s dealing with: English language testing, we’ve got one provider with a monopoly. The next time you can get a test in South Africa is October – a huge impediment to attracting labour from some of those countries because of the English test. We have to be able to make that more efficient.
Security checks are increasingly a delay on processing; the increased fear of a risk of terrorism means much more security checking done than perhaps in the past; it’s often slow. Health checks in some parts of the world are also quite slow. So while the Department has its responsibility there is a range of external issues that the Department can’t control in terms of its responsiveness.
I think I neglected to make the strong point earlier that we favour permanent migration as the first policy response in the migration program. You would have noted that the previous government increased permanent migration for this year, this financial year by 5,000 over the previous financial year. In March, the Rudd Labor government announced a further 6,000 for this year for the period March to June.
A large increase in the permanent migration for the short period of the year that we were in office and obviously the permanent migration program for next year will be set in the coming budget and will reflect that priority for permanent migration. And I think, as I say, emphasises our commitment to permanent migration as a policy response.
I think the debate is increasingly going to be about labour shortages. If you look at the demands in the press; the demands coming in my office are from the agricultural, horticultural industries for labour. Traditionally you would consider it unskilled or semi-skilled labour. It is interesting that some of the areas in the country that we’ve traditionally been seeing as being a little more prone to racism or conservative views are screaming out for Vietnamese and Chinese workers. It’s an interesting and pleasant development in our political debate but people are seeking labour.
I’ve got the industry associations like hospitality industry, etc. banging on my door about labour programs. They are not really talking about skills or what we traditionally regard is the skilled migration program categories. The pressure on the integrity of the scheme is often coming from people looking to push the boundaries on the skill definition; all the time pushing the boundaries.
You can come in as a chef but you can’t as a cook. There are an awful lot of chefs coming into the country at the moment and, as I say, that’s the sort of pressure on the Department in terms of some of the integrity issues.
I see you are going to debate the South Pacific proposal for bringing in South Pacific labour into the country on a temporary scheme later in the day. I think its good that we engage in that debate. Quite frankly, it’s an issue that will be considered by government reasonably shortly. There is a delegation in New Zealand today led by my Departmental secretary with representatives from a range of other Departments looking at the New Zealand experience, examining how its working there, and their reporting will form part of a report to Cabinet in the next few months which will see us making a decision about whether we go down the same path.
No decision has been made so it’s important I think that we have that public debate. But it is true that we are increasingly having a debate about effective guest worker schemes, be it the South Pacific, be it more broadly. And, as I say, the labour shortages – not just skills shortages – will be driving that debate, and demands from industry to fill those labour needs that they are experiencing.
So it’s not going to be a quiet time in immigration that makes it a very worthwhile time for Catalyst to be debating the issues. I hope the debate goes well. The government is very keen to see the debate progress. We will be players in that but we will be committed to running a fairly strong migration program over the next few years.
As I say, I think we need much better longer term planning. It really does raise the issue of whether we are going to develop a population policy; a bit of a broader perspective on these issues, and I think that will always be very much part of the debate in the coming months.
Anyway, I hope those perspectives help fuel the debate even if I didn’t provide lots of easy answers and I thank you for your attention and wish you well for the rest for the day.
Thank you.
