Former Productivity Commissioner: mass immigration squeezing life from cities

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By Leith van Onselen

After last month destroying the flimsy arguments for mass immigration perpetuated by the boosters at the RBA and the Australian Treasury, The Australian’s Judith Sloan has penned another article arguing that Australia’s record migrant intake is squeezing the life from Australia’s two major cities:

The permanent migrant numbers are set at 190,000 a year and, unless the government changes its mind, it will remain so for the next three ­financial years. The government is wont to quote the numbers on net overseas migration, which include temporary workers and international students, boasting that the NOM is less than it was under Labor.

This is just an excuse on the part of the government to mask what is, by many people’s assessment, an extraordinary number of permanent migrants who are ­allowed to enter the country each year. And note that nearly three-quarters of these migrants head for Melbourne or Sydney. Note also that immigration is contributing more than 50 per cent of our population growth.

And let’s face it, the skill cate­gory in the permanent entry program is relatively easily gamed. It is also clear that more inter­national students who have graduated here are entering the country through the family category, not the skill category.

The bottom line is that the ­intake of 190,000 is way too high; it is placing unacceptable pressures on the urban amenity of Melbourne and Sydney. The roads are choked, the schools are full to overflowing, the hospitals are struggling to cope and parts of the cities are unrecognisable from just a few years ago.

If the government had any sense — and I know that’s a big call — it would significantly cut the ­annual intake for at least several years to ease the problems associated with mass immigration.

What about the “cultural enrichment” and “vibrancy”, Judith? Think of the culture!

But seriously, Judith Sloan is right on this issue. The massive increase Melbourne’s and Sydney’s populations in the 12 years to 2016 is clearly unsustainable:

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With net overseas migration (NOM) into both jurisdictions at all-time highs – 185,500 (combined) in the year to June 2017 – accounting for three-quarters of national NOM:

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Both cities are bursting at the seams, suffering widespread infrastructure bottlenecks and extreme problems with housing affordability. And this situation is worsen with both cities’ populations expected to hit at least 8 million people mid-century!

My only minor gripe with Sloan’s commentary is that she has under-quoted Australia’s permanent migrant program by only mentioning the 190,000 non-humanitarian intake. If the humanitarian intake (circa 13,000) is included, then Australia’s permanent migrant program is actually just over 200,000:

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Nevertheless, Judith Sloan was the Commissioner in charge of the PC’s 2006 review into the Economic Impacts of Migration and Population Growth, so on this topic she carries significant weight and her views should be taken seriously. And, not surprisingly, Sloan has found only modest (if any) per capita economic benefits from immigration, but significant costs to incumbent workers’ wages, congestion, housing affordability, and the environment.

It’s time that our politicians and left-leaning media stopped ignoring the issue. Australia’s living standards are at stake.

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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.