The latest Intergenerational Report (IGR) from the Australian Treasury warned incessantly that Australia faces an ageing population timebomb in the decades ahead that will slow economic growth and derail the federal budget’s return to surplus.
Given the Treasury’s bluster over an ageing population, it is hard to believe that policy makers still allow migrant Australians to import around 9,000 elderly parents into Australia each year via the permanent parental visa program. Doing so immediately ages Australia’s population while adding directly to the burden on economic and social infrastructure that has been paid for by other Australians.
In its 2016 Migrant Intake into Australia report, the Productivity Commission (PC) estimated that the circa 9,000 elderly permanent parental visas granted every year cost Australian taxpayers between $2.6 and $3.2 billion in present value terms, or between $335 000 and $410 000 per elderly adult, with the cost rising over time as numbers increase. The PC also explicitly recommended that parental visas be abolished, noting that they divert scarce funding away from Australia’s broader welfare system:
“The contributory visa charge of just under $50 000 meets only a fraction of the fiscal costs for the annual intake of roughly 7200 contributory parents. And an additional 1500 parents make a minimal contribution. Overall, the cumulated lifetime fiscal costs (in net present value terms) of a parent visa holder in 2015-16 is estimated to be between $335 000 and $410 000 per adult, which ultimately must be met by the Australian community. On this basis, the net liability to the Australian community of providing assistance to these 8700 parents over their lifetime ranges between $2.6 and $3.2 billion in present value terms. Given that there is a new inflow each year, the accumulated taxpayer liabilities become very large over time. This is a high cost for a relatively small group.
Ultimately, every dollar spent on one social program must require either additional taxes or forgone government expenditure in other areas. It seems unlikely that parent visas meet the usual standards of proven need, in contrast to areas such as mental health, homelessness or, in the context of immigration, the support of immigrants through the humanitarian stream, and foreign aid.
Given the balance of the costs and benefits, the case for retaining parent visas in their current form is weak”.
With this background in mind, it is disturbing to read that an increasing number of Indian-Australians are attempting to bring their parents into Australia via the parental visa program:
Data obtained from the Department of Home Affairs by SBS Hindi indicates a steady increase in the number of parent visa applications lodged by the Indian-Australian community over the past three years.
Over the period January-May 2021, Indian nationals lodged 1,362 parent visa applications as compared to 1,049 in the similar period of 2020.
The same figure during January-May 2019 stood at 662 and at 671 lodgements in Jan-May 2018…
Gold Coast-based migration agent Seema Chauhan told SBS Hindi she has seen a significant increase in enquiries about permanent residency for parents in the last few months and the lodgements of parent visa applications have shot up after COVID-19.
It is only natural for economic migrants to want their parents and family to come and live with them in Australia. But they chose to come to here under their own free will. There should never have been the expectation that they could bring their elderly parents along for the ride at taxpayers’ expense.
These economic migrants chose to be separated from their parents when they came to Australia in the first place.
There is no magic pudding when it comes to public finances, and the massive fiscal cost of parental visas necessarily diverts funding away from other social programs, such as:
- funding for schools and hospitals;
- funding for infrastructure;
- funding for the Aged Pension and Newstart; and
- funding for the NDIS.
The fiscal cost of these visas is already enormous and growing, and poses a threat to Australia’s welfare state as we know it.
These visas also obliterate the false claim in the IGR that a strong migration program is needed to mitigate an ageing population. Instead, these visas directly add to the problem.
In short, parental visas must be abolished, as explicitly recommended by the PC. There is simply no public policy justification to maintain these visas.
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