Australia’s Immigration Policy: Political And Economic Lessons For Europe

Far right European politicians have apparently ‘fallen in love’ with a particular aspect of Australian immigration policy, namely, the government’s abysmal treatment of asylum seekers. The current regime of dealing with illegal arrivals seeking asylum in Australia is built on two very contentious elements: turning back ‘boat people’ who seek to reach its shores by sea; running offshore detention centres in poor island states for illegal, sea-borne arrivals at vast expense.

Such a harsh approach is seen by both the current Australian government and the Labour Opposition as the unfortunate, but necessary, price to pay for deterring those who seek to enter illegally. Its advocates contend this approach has been successful in preserving popular support for Australia’s relatively modest Refugee and Humanitarian Program.

Despite being the object of international opprobrium, successive Australian governments – both centre-right and centre-left – have maintained this rather misguided and morally dubious regime of dealing with ‘queue-jumping’ asylum-seekers. The message seems to be: if you wish to seek asylum in Australia join the queue and have the patience to be processed through the normal channels. Both Malcolm Turnbull, the current Australian Prime Minister, and Tony Abbott, his nemesis and predecessor, are united in seeking to promote this policy as worthy of emulation by rich countries of the West. These countries, especially in Europe, are feeling besieged by a huge surge in refugees seeking to escape impoverishment and conflict from various parts of the world. No wonder European populists, who wish to whip up nativist sentiment in the midst of a global refugee crisis, are seduced by this siren song emanating from ‘Down Under’.

It is indeed a pity that that European politicians– or at least some of them – appear to be learning the wrong lessons and to have fallen prey to a distorted narrative of how Australia conducts its immigration policy.

Australia now has three streams in its permanent migration program – family, skill and humanitarian. The skill stream – by far the largest– is in turn supplemented by a temporary migration program. This includes international students in Australia and time-bound migrants that can respond to perceived labour market imperatives.

Cultural diversity

Australia’s bipartisan approach to skilled immigration has been a key instrument of enhancing cultural diversity. Conservative politicians in Europe ought to be reminded that the current Australian Prime Minister is not merely keen to advocate a muscular approach to border protection but fond of saying that Australia is ‘the most successful multicultural society in the world’.

Should European policy-makers accept this as fact or as an antipodean version of post-truth politics? It turns out that Turnbull can appeal to salient facts that lend support to his proclamations, but Australia has some way to go before it merits that title. Despite this caveat, Turnbull should be commended for invoking multicultural cohesion as a key measure of societal success. This is an important message in a European environment of rising xenophobia and nativist populism.

The 2018 Australian government report on ‘Shaping a Nation’ compiles some impressive statistics. In recent years, permanent migration intake has been set at 190,000 annually, with 70 per cent of this skilled migration. There are now 11 Asian countries, with China and India in the lead, among the top 20 source countries for migrants – a far cry from the heyday of ‘White Australia’ policy that was characterised by UK, Irish and other European migrants.

In the 2000s, migration has accounted for just over 50 percent of Australia’s population growth, most notably in its state capital cities, ranging from 32 percent (Hobart) to 63 per cent (Sydney). The migrant share of the population in the state capital cities now average 30 percent. Furthermore, 49 percent of Australia’s population is either a migrant or a child of one. Such statistics make Australia an outlier among OECD countries.

There have been recent calls in some quarters – as in Europe – for sharply reducing the current rate of migration. A good example is the case of Abbott who argues the case for a much reduced migration intake. What can one say about the likely economic consequences of this proposition? Will it improve the quality of life and labour market outcomes, most notably in terms of wage growth, as its advocates proclaim? The available evidence casts considerable doubt on such advocacy.

Bring us your skills

The ‘Shaping a Nation’ report claims that:

Australia’s focus on skilled migration has demonstrated positive effects for economic growth, because our migrants on average lift potential GDP and GDP per capita through …population, participation and productivity. In particular, migration has played an important role in ameliorating and alleviating the adverse effects of our aging population. Further, migrants generate jobs and economic opportunities more broadly, because they lift aggregate demand through consumption and investment. Temporary migrants also lift our exports, particularly in the education sector.

The report finds that migrants, once they have acclimatized to local labour market conditions, have rather similar unemployment rates to Australian-born residents and the skilled ones enjoy a modest wage premium over their indigenous counterparts because they gravitate to higher-paying jobs. It rejects the view that migrants at the low end of the skill spectrum are responsible for a ‘race-to-the-bottom’ scenario of intense competition for limited job opportunities and depressed wages. Migrants seem to complement, rather than compete, with local workers.

The report notes that the fiscal consequences of migration, especially of the skilled variety, are favourable, leaving the government with a lifetime (estimated over 50 years) projected ‘surplus’ of A$ 9.7 billion (€6bn). Skilled migrants (of the 2014-2015 cohort) in employment generate tax revenues that significantly exceed the support they receive through welfare payments and other forms of services. More importantly, the estimates suggest that skilled migrants cross-subsidize the family intake and the refugee and humanitarian programs because these have negative budgetary consequences.

Social cohesion

Any debate over immigration cannot ignore issues pertaining to cultural identity and social cohesion. This is at the core of primordial emotions about the ‘other’ that are evoked by those influenced by a nativist agenda in Europe and elsewhere. The report devotes just two paragraphs to these highly sensitive issues. This is where the ‘Mapping Cohesion Surveys’ become invaluable.

The evidence is encouraging. A solid majority (63 percent) consider Australia’s high migration intake to be acceptable and an even higher majority (more than 80 percent) agree that multiculturalism has been beneficial. Yet, there are areas of considerable concern. As the latest (2017) Survey notes, ‘there is a relatively high degree of negative feeling towards Muslims’, ranging from 25 percent to 41 percent, depending on the survey instrument that is used. Self-reported cases of discrimination based on race, religion and ethnicity have jumped from 9 percent to 20 percent in recent years.

A 2018 Australian Human Rights Commission report laments the utter lack of cultural diversity in leadership positions by examining the background of ‘chief executive officers of ASX 200 companies, federal ministers, heads of federal and state government departments, and vice chancellors of universities’. To their dismay, the authors find that:

…about 95 per cent of senior leaders in Australia have an Anglo-Celtic or European background. Although those who have non-European and Indigenous backgrounds make up 24 percent of the Australian population, such backgrounds account for only 5 per cent of senior leaders. Cultural diversity is particularly low within the senior leadership of Australian government departments and Australian universities.

The report notes that, unless determined public action is taken, including implementing such an elementary step as collecting systematic data on cultural diversity among Australia’s leaders, the problem will remain entrenched and dent the country’s strongly held perception as a ‘fair go’ society.

In sum, it is important for European politicians to jettison their interest in Australia’s cold-hearted and callous approach to ‘queue-jumping’ asylum seekers and focus instead on the promising lessons that can be learnt from its skilled migration program. Such a program has engendered multiple economic benefits and enabled ‘White Australia’ to reinvent itself as a peaceful and prosperous multicultural society. Of course, there are remaining challenges, but migration in Australia has indeed shaped a nation in a positive way.