Date posted: 10/05/2023

Federal Budget 2023-24: Skilled migration boost and skills recognition improves

A recap of the key skilled migration announcements for accountants in the May Budget

In brief

  • Skill stream remains the focus of the permanent migrant intake
  • Post-study work rights extended for temporary graduate visa holders
  • Skills assessment pilot projects to improve skills recognition

In line with the migration strategy being developed by the Australian Government, the Budget includes several measures to boost skilled migration and deliver the skills required to support the economy while improving outcomes for skilled migrants and Australian workers.

Boosting skilled migration

Key Budget measures to enable the migration system to bring in the skilled migrants needed are below.

1. 72 per cent of places in the 2023-24 Permanent Migration Program will be allocated to skilled migrants.

Australia’s 2023-24 permanent migration program planning level will be set at 190,000 places, down from 195,000 in 2022-23. This reflects elevated forecast population growth and net overseas migration, of which the permanent migration program is one part.

With Australia facing the second highest skills shortage in the world, and accounting shortages still near record levels, CA ANZ supports the Skills stream remaining the focus of the permanent migration program to help tackle the ongoing labour shortage.

In 2023-24, the Skill stream component of the migration program will be allocated 137,100 visas, down by 5,300 from 142,400 in 2022-23.

This largely reflects reduced numbers of Skilled Independent visas (following closure of the NZ stream of subclass 189 from 1 July this year and introduction of a direct pathway to citizenship for eligible visa holders) and reduced numbers of Business Innovation and Investment Program visas, to allow a greater focus on addressing immediate workforce shortages.

CA ANZ’s joint submission with CPA Australia on the 2023-24 Permanent Migration Program advocated that annual planning caps on the quantity of migrants in the Skill stream should be removed and replaced with an approach based on migrant quality to both address skills shortages and develop the nation’s human capital.

Avoiding planning targets that can change annually will also increase certainty for prospective skilled migrants and employers, reduce visa processing times and improve Australia’s competitive position relative to other countries who are competing for the same skilled labour.

We have also advocated for planning and coordination at all levels of government to provide the infrastructure and services required to support the migrant intake.

2. An extra two years of post study work rights will be provided to Temporary Graduate visa holders with select degrees.

Providing the ability to work post study is a smart strategy to improve the pipeline of skilled labour in key sectors as Australia faces fierce competition for international students from countries like the United States, the United Kingdom and Canada which all offer work rights. This is an important consideration for globally mobile talent when weighing up their alternatives. 

CA ANZ recommended in its joint submission with CPA Australia on the review of Australia’s migration system that accounting graduates should be included amongst those who are eligible for extended post-study work rights, given current and expected labour shortages that cannot be filled by local supply. 

As the Skills Priority List will become increasingly important in determining migration policy, it is important the list properly recognises the ongoing shortage of and demand for accounting, audit and finance professionals which will only increase as the workforce ages and retires.

3. Increasing the Temporary Skilled Migration Income Threshold (TSMIT) to $70,000.

The Government has previously said it is necessary to increase the minimum salary an employer must pay a temporary skilled worker to help prevent exploitation and increase fairness for both migrants and Australian workers. This is because the TSMIT has not been increased for a decade and evidence shows this has put downward pressure on wages earned by foreign workers.

While migrant exploitation is gravely concerning, in CA ANZ’s view there are better ways to increase fairness for migrants and Australian workers other than introducing a wage threshold. 

Assessment of migrant quality remains the best way of determining salaries and earnings potential. If a wage threshold is introduced, a key principle is that it should not be too low which could leave workers open to exploitation or too high which could create worker shortages.

Factors other than wages levels, such as visa status, can also contribute to exploitation. Migrants on temporary visas without pathways to permanency are at greater risk of exploitation. 

To this end, CA ANZ is pleased Australia’s Home Affairs Minister has also announced a pathway to permanent residency will be introduced for all temporary skilled workers by the end of 2023. This will provide greater certainty and security to both employers and migrants and help increase the skill level within the existing capped permanent migration program. 

Improving skills recognition

To improve skills recognition, the Government is also rescoping two Skills Assessment Pilots to provide onshore migrants with fast tracked skills assessments, free employability assessments and access to further training to improve their employment prospects.

CA ANZ has strongly advocated for improving skills recognition including calling for a review of the criteria used to assess the quality (or human capital) of migrants, including recognising shorter form credentials and prior learning.  

Assessors, including professional bodies, are well placed to independently assess the Australian Qualifications Framework (AQF) level equivalency of shorter form credentials and prior learning. Guidance is provided by the National Microcredentials Framework and the Joint Statement of Principles for Australian Professions’ Micro-Credentialing.

To support the Government’s aim to provide further training to skilled migrants to improve their employment prospects, the Professional Year Program for Accounting (Accounting PYP), or a version of it, could be provided to recent and prospective skilled migrants. 

The Accounting PYP is a work readiness program, approved by the Department of Home Affairs and available to international students with an accounting degree from at least two years of study at an Australian university. This program delivers better employment outcomes and could also be adapted for other areas of skills shortages.

The Budget also announced a welcome Mechanism for the Mutual Recognition of Qualifications which will ensure students from India and Australia have greater certainty that the qualifications they attain will be recognised by both countries.

Outcomes of the Jobs and Skills Summit

Building on the outcomes of the Jobs and Skills Summit CA ANZ attended on behalf of the profession in September last year, the Government will provide $125.8 million over 4 years from 2023–24 to alleviate critical skills shortages by strengthening the migration system through the following measures which we advocated for:

  • $75.8 million over two years from 2023–24 to extend funding for visa processing officers to ensure timeliness of visa processing, and to improve existing visa processing systems including upgrades to visa ICT systems;
  • $50.0 million over 4 years from 2023–24 (and $15.3 million per year ongoing) for additional enforcement and compliance activities to maintain the integrity of the migration system and enhanced safeguards and protections to protect migrant workers from exploitation.

Return to Federal Budget Coverage

Equipping you with the information and commentary you need to know about the Federal Budget.

Read more

2023-24 Permanent Migration Program

CA ANZ’s joint submission with CPA Australia on Australia’s 2023-24 Permanent Migration Program.

Read more

Review of Australia’s migration system

CA ANZ’s joint submission with CPA Australia on the review of Australia’s migration system.

Read more

Search related topics