Starting this month, the federal government will issue up to 15,000 sponsored parental visas to migrants who wish to bring their elderly parents to live in Australia for a continuous period of three, five or 10 years.
However, members of the Indian community have attacked these visas, labelling “unfair” the need for private health insurance, the minimum family income threshold of $83,454.80, and the application fee of $5000 for a three-year visa, $10,000 for a five-year visa and $20,000 for a ten-year visa. From SBS Hindi:
“This visa is discriminatory,” says Jasvinder Sidhu, a Melbourne-based community leader.
“Many migrants won’t be able to afford the high fees of this visa. The conditions are already harsher in this visa as compare to normal visitor visa. One has to have health insurance for this visa. It is an actively discriminatory visa against migrants,” says Mr Sidhu.
A long-term visa designed to reunite families is a long-standing demand of some migrant communities in Australia. Mr Arvind Duggal of Adelaide has been running a campaign to support this demand. He says the new conditions make this visa unaffordable for many migrants.
“Why visitor visa should have an income test?,” asks Mr Duggal.
“This visa does not help the migrant communities waiting for a visa to bring their parents to the country. This visa has an unfair fee structure. There is an unnecessary income test”…
Mr Duggal says many migrants will not be able to pass the income test… “The government had promised a fair visa. It is not that visa,” Mr Duggal told SBS Hindi adding the fight for a fair parents visa will continue.
This visa is “unfair” alright – unfair to Australian taxpayers.
The Productivity Commission’s (PC) 2016 Migrant Intake into Australia Report estimated that parental visas cost Australian taxpayers between $2.6 and $3.2 billion in present value terms, with the cost likely to rise over time as numbers increase. The PC also concluded that “the case for retaining parent visas in their current form is weak”:
“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”.
The PC’s subsequent Shifting the Dial: 5 year productivity review also doubled-down against parental visas, claiming that their long-term costs to the Budget are immense:
… parent visas, which provide a short-term benefit to the budget via visa charge income, but impose very large costs in the longer term through their impacts on expenditure on health and aged care, and social transfers. In previous work, the Commission estimated the budgetary costs associated with the 2015-16 parent visa intake alone to be $2.88 billion in present value terms over the lifetimes of the visa holders. By comparison, the revenue collected from these visa holders was only $345 million. Ten year estimates of the fiscal effects of the current parent visas would show a similarly stark disjuncture between revenue and costs, and would therefore provide the insights for a more informed policy decision on the pricing or desirability of these visa types than the current decision-making framework.
These new parental visas are unambiguously poor policy and a very bad deal for incumbent Australian taxpayers. This is because the additional elderly migrants will add pressure to already strained economic and social infrastructure and will not work, pay taxes, or contribute in a meaningful way to the economy.
Existing residents will be required to foot the bill for the additional government investment on hospitals and infrastructure required to keep up with the expected influx.
Moreover, because these migrants will be elderly, and likely be heavy users of health services, they will place upward pressure on private health insurance premiums for everyone else. They would also place greater pressure on health care professionals – both private and public – whose training is paid for, to a large extent, by the taxpayer.
Stupidly, our federal politicians have gone against the PC’s recommendations and chosen to increase the quantity of elderly migrants flowing into Australia, thus adding to strains on infrastructure, housing, the Budget, as well as exacerbating the ageing of the population.
Given the huge taxpayer cost of parental visas, and that these funds could be better spent elsewhere for the benefit of the incumbent population (e.g. raising Newstart), there is a strong case for abolishing parental visas altogether, rather than expanding them as the federal government has done.
