Australia must abandon temporary parental visas

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By Leith van Onselen

Academics have penned a whining piece in The Guardian protesting at the so-called ‘cruel’ treatment of elderly migrants’ parents under the Turnbull Government’s five-year temporary parental visa scheme, which will come into effect on 1 July 2017:

In the final fortnight of the federal election campaign both the Coalition and Labor responded to lobbying from the migrant community with promises to create a new long-term, temporary visa for parents…

Yet the temporary visa proposal is problematic: without access to government benefits and services – including the aged pension and Medicare – these older, mostly non-English speaking migrants will join an emerging cohort of second-class Australians who are denied full membership of society…

Currently there are two ways to bring a parent to Australia permanently. The first involves waiting up to 30 years for a visa, by which time your parents are likely to be too old to migrate or dead. The second requires paying a fee of around $50,000 per parent in order to jump the processing queue…

The push for a renewable, long-term, temporary visa is a “second best” response to these unpalatable choices…

The new temporary parent visa is designed to allow many more parents to migrate to Australia, while avoiding these fiscal costs via a user pays principle: parent migrants must have private medical insurance and their Australian sponsors (their adult children) must show that they have the resources to support them if necessary. Sponsors will also have to post a bond to offset costs to the taxpayer should the Australian government have to care for their parents.

This might look like a win-win arrangement but it has potential pitfalls. While the proposed five-year visa is described as temporary, it is also renewable, so parents could end up living out the rest of their lives in Australia on a series of temporary visas. They would be, for all intents and purposes, permanent residents, without any of the rights of permanent status, remaining outside the welfare safety net and wholly reliant on family for care and assistance. They would be living in a democracy but denied political representation and the right to vote.

Based on existing demand for permanent parent visas, we estimate that a temporary visa could generate between 10,000 and 30,000 new migrants per year, adding significantly to Australia’s population over time.

…in our view, renewable temporary visas do not sit well with Australia’s aspirations to be a citizenship-centred, multicultural democracy because they risk creating a growing cohort of people who are permanently excluded from social support and political participation…

…adding another category to Australia’s suite of temporary visas is not good policy. A growing population of elderly, non-English speaking migrants stuck on temporary visas is not a positive development in Australia’s migration story and should be opposed. Better approaches are possible.

Where is the economic benefit of allowing a flood of elderly people into Australia? They will add pressure to an already strained system and will not work, pay taxes, or contribute in a meaningful way to the economy.

Moreover, where is the additional federal government investment in hospitals and infrastructure to keep up with the expected migrant influx?

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Sure, the policy will require these migrants to have private health insurance. But given that they would be old, and likely be heavy users of health services, they will place upward pressure on private health insurance premiums for everyone else.

Currently, an uninsured non-resident who turns up at an emergency department gets full treatment irrespective of whether they can or will pay. If they are sick enough (e.g. having a heart attack) they go to the top of the queue and everyone else waits. The costs just end up on a growing list of unpaid and uncollectable debts on a health department ledger.

These elderly migrants will also place greater pressure on health care professionals – both private and public – whose training is paid for, to a large extent, by the taxpayer.

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More broadly, Australia’s infrastructure, public services, housing affordability, and overall living standards are already under strain. Adding aging migrants into the mix will only exacerbate the decline.

The Turnbull Government must junk this policy, as well as endorse the Productivity Commission’s recommendation to cut back on the family reunion permanent migration stream, which is costing taxpayers and estimated $335 000 to $410 000 per adult, or between $2.6 and $3.2 billion in present value terms.

Every dollar spent on these programs requires either additional taxes or forgone government expenditure in other areas.

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If the authors are so worried about social justice, how about turning their attention to the huge numbers of homeless sleeping rough across Australia?

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.