Posts Tagged ‘deficit’

move2nz investigates family category changes

May 26, 2012

You will have seen move2nz’s comments about the original interview Nathan Guy gave which he now confirms was the official launch of these policy changes.

Reading the initial updates on the Immigration New Zealand (INZ) website I was very concerned, so concerned in fact that I immediately wrote to the Immigration Minister to ask for clarification. You can download a copy of my letter here  pdf document[446 Kb]. I will let you know if I get a reply.

Here are some points to consider that will affect a great many people and a look at what is being gained through these changes.

When will existing applications be processed?

What the immigration website indicated was that new applications under Tier One of the Parent Category would go straight to the front of the queue for allocation and processing. Applications for the Parent Sibling and Adult Child Stream would be added to the queue behind these and last of all would come the new Tier Two Parent application.

  1. Tier One applications entered under the new Parent rules;
  2. Existing applications entered under the old rules (both ‘Parent’ and Sibling/AdultChild’);
  3. Tier Two applications entered under the new Parent rules.

There are 4,000 places in the annual quota – that’s 4,000 people not 4,000 applications (family category applications on average represent 1.93 people). What the INZ site appears to say is that the quota will initially be filled each year from Tier One, then any additional places will be allocated to the older applications and finally any places left will go to Tier Two.

The problem is that the old Parent Category with a quota of 4,000 was always over-subscribed.

More than 4,000 places have been approved already this year and the new rules for Tier One are unlikely to reduce this number.

So after 4,000 places have been taken by Tier One applications each year what happens to the older applications and Tier Two?

This is the main issue raised in my letter and I am deeply concerned that it will be years, possibly even decades, before these applications are finally allocated for processing unless the old quota of 1,400 places for the Sibling and Adult Child Category is left in place until these are cleared.

Of course a lot depends on how many people will be sitting in that queue behind Tier One waiting to be allocated a case-officer. So just how many are there and how long would it take to clear this backlog?

Just how big is the queue?

Immigration department statistics are a little out of date, only showing to January 2012 but more recent figures are shown each fortnight on the release showing numbers of Expressions of Interest selected under the Skilled Migrant Category.

At the bottom of the page this confirms that on May 16th the INZ had 6,406 applications entered under what is now the old Parent Sibling and Adult Child Category representing 12,348 people.

News stories have confirmed that the INZ accepted 7,400 applications before closing this Category which would represent approximately another 14,264 people giving a grand total of around 26,612 people standing in the queue to be allocated a case-officer.

Even if the old quota for the Sibling and Adult Child section of the category of 1,400 was maintained (and the immigration department have indicated this will not be the case) I calculate that it would take 19 years to clear this number, a completely unacceptable length of time.

Just what the Minister proposes to do to meet promises made of less than two years before applicants are allocated a case-officer will hopefully be revealed soon. I have great faith that the Minister will uphold the integrity of his department and not leave people waiting for decades to be allocated a case-officer.

What will be gained from these changes?

I may be speculating here, but for the first time in recent history the INZ is carrying a significant deficit, calculated to be as much as $44 million by the end of June.

As the INZ’s processing work is funded through fees paid by migrants it is little wonder that the department has a deficit after the Skilled Migrant Category, making up 60 percent of all approvals, was cut by nearly a third from January 2010 – a move I calculate loses the INZ $16.7 million per year in fees and levies (not including EOI payments).

The NZ government has confirmed many times that there is no new money in this year’s Budget to be delivered soon meaning that this massive deficit (which represents nearly a quarter of the INZ’s entire budget for processing) can only be cleared either through raising the number of migrants paying fees back up to 2009 levels, or through ‘efficiencies’ that would see migrants paying more than the cost of processing their applications. It is interesting that a new EOI stage and fee have now been added for parents.

Certainly closing an immigration category bringing just 1,400 people who could not claim benefits into New Zealand each year is exceedingly unlikely to save the $40 million expected and needed to clear this huge shortfall created as a result of policy changes.

Of course letting in an additional 7,400 applications, many of which will be incomplete, will create additional delays and backlogs adding more and more pressure to INZ staff who are likely to be squeezed pretty hard to clear this massive backlog of applications.

Please bear in mind when you are talking to immigration officers that this situation has been created as a result of policy changes completely outside their control. They will be doing a very hard job while watching a new computer system being built which will be likely to replace at least some members of staff, so please take it easy on them.

A backwards step

Finally as a parting thought, although I have no issue with the government’s right to change immigration policy it is hard to regard these changes as a positive step.

Government press releases have confirmed a long term goal to “attract and retain skilled migrants” however policies introduced appear to working counter to this.

Attraction of skilled migrants has suffered a huge knock with huge cuts to the Skilled Migrant residence Category and the Essential Skills temporary work category implemented intentionally since the start of 2010. These latest changes are likely to threaten retention rates through removing family support.

Although the family members targeted by these changes do not necessarily generate significant income for the New Zealand economy it is clear that they are not a drain on it. Less than 2 percent of migrants claim core benefits in New Zealand, any amounts collected by family migrants would be claimed back by government from their sponsor, and employment rates put forward as a reason to close this category show that workplace participation just amongst these family members (i.e. excluding the skilled workers) of 66 percent compares well the New Zealand average of 68.2 percent.

In my experience of working with thousands of migrants a core issue reducing retention of highly skilled workers is lack of family support at key life stages. For example when a child is born or gets sick new mothers often look for the support of their mother to get through and many have to leave New Zealand to get this.

As any family with children will know, the wider family around you makes an incredible difference. I’m not just talking about baby-sitting, but it touches everything through general support and the feeling of safety and well-being created from having people who love you and will watch out for you and yours.

Most migrants leaving speak of a feeling of vulnerability which has grown to unmanageable proportions being so far from people who love them.

Many New Zealanders will understand this very well – one of the most common times for New Zealanders to head home is when they start a family and realise home is where the heart is. It’s not just about a place, it’s about having the security of your family around you.

I believe this change to block certain parents and any other family unable to make it through the Skilled Migrant Category – so stringent that it is open only to approximately 2 percent of any population – will most certainly decrease retention rates of skilled workers who are the main contributors to the $1.9 billion to $3 billion (net of costs) added to the New Zealand economy by migrants every year.

Mike Bell
Site architect, – helping migrants become kiwis since 2005


Immigration department ‘own-goal’?

March 28, 2012

Drop in migrants hits Govt coffers

Immigration New Zealand could be heading for a record deficit because of the drop in numbers of people coming to this country.A briefing paper to the Immigration Minister says the agency’s memorandum account is forecast to hit a deficit of $44 million at June 30, up from a deficit of $28.1 million recorded last October.

“This is largely a result of a drop in visa application volumes following the global financial crisis and the Canterbury earthquakes,” the paper says.

This looks like a huge ‘own-goal’ for the immigration department leading to the first deficit since the current system was introduced in 2001.

While government reports might point to earthquakes and the global recession for the shortfall this does not stack up and the department has been unable to provide any evidence to support this when asked.

Strangely the fact that policy was introduced in January 2010 to cut the number of Expressions of Interest (EOIs) selected by the immigration department under the Skilled Migrant Category which makes up 59% of New Zealand’s Residence Programme. Since then the number of perfectly acceptable EOIs left to expire has been steadily rising as only a third of the EOIs available are being selected.

These policy changes helped drop the New Zealand residence programme figures 4,263 below the minimum quota last year – the first time the quota has been missed since it was introduced. This would have cost the department over $6.2 million in lost fees and levies.

This process has continued and as a result the shortfall caused by policy is calculated to double in the current year with the Immigration department on target to miss the old residence programme quota by a whopping 33%. The drop of 8,442 migrants below quota will lose the government over $12.2 million in fees and levies for residence alone.

This situation could easily be helped by simply putting selection rates for skilled visas back to 2009 levels – there are plenty of applicants available – over 1,200 were left in the pool last selection – but that does not look likely.