While Eryk Bagshaw’s article of 8 July 2018 screams Millionaires stream in, the Sun Herald’s editorial of the same day is a bit more sanguine about the benefits and risks of the Business Innovation and Investment Programme that facilitates entry of business migrants and investors. This Programme and its predecessors, while superficially attractive, have a chequered history as recognised by the Productivity Commission in its 2016 Report on the Migrant Intake and Minister Alex Hawke’s decision to initiate a review of the Programme.
The merits of the former Business Migration Program were being questioned as early as the 1980s when former Senator Don Grimes asked about “people who arrived here with $250,000, $500,000 or even more in the bank, which money went into their accounts just before they came to Australia, and suddenly disappeared out of their accounts just after their arrival.”
Numerous allegations of the BMP effectively being outsourced to accredited agents (under former Minister Mick Young) led to a Joint Committee of Public Accounts recommendation in 1991 for the Program to be abolished. Immigration Minister Gerry Hand responded almost immediately to axe the Program and set out to establish a replacement scheme that focused on business skills and a commitment to establish a business in Australia more than the amount of capital held. In time, this included provisional visa arrangements that required the establishment of a business for a minimum period before permanent residence could be confirmed.
In recent years, the Business Innovation and Investment Programme has again focussed increasingly on investment through the Significant Investor Visa and the Premium Investor Visa. The Productivity Commission identified considerable risks with these elements of the Programme including:
- Lack of an English language requirement or an age threshold
- Limited residency requirements
- Perception visas are being “sold” to wealthy foreigners
- Possible pathway for investing “dirty money” in Australia.
Given these risks, the Productivity Commission recommended it would be best for these investment focussed elements of the Programme to be closed down to new applications.
Indeed, the Productivity Commission made the very strong point that “there is little robust evidence that Australia faces significant difficulties in attracting foreign investment for profitable activities. This is particularly true for vanilla investments, such as listed equities and bonds”. Indeed, there is little evidence that our tax arrangements are a barrier to attracting investment or high wealth individuals.
Against this background, a return to focussing on business skills and establishment of new businesses in Australia would have merit.
Abul Rizvi was a senior official in the Department of Immigration from the early 1990s to 2007 when he left as Deputy Secretary. He was awarded the Public Service Medal and the Centenary Medal for services to development and implementation of immigration policy, including in particular the reshaping of Australia’s intake to focus on skilled migration. He is currently doing a PhD on Australia’s immigration policies.