Posts Tagged ‘parent category’

NZ Residency – changes to the Family Stream

May 12, 2012

As highlighted on move2nz.com earlier in the year, the report prepared for the incoming Immigration Minister Nathan Guy confirmed plans to make significant changes to the Capped Family Stream of New Zealands Residence Programme.

I will comment about the lack of honesty in the Minister’s reasoning presented for these changes separately as that deserves its own space.

Here I present a summary of the changes announced this week to the Capped Family Stream of New Zealand’s Residence Programme. These changes to both the Parent and Sibling and Adult  Child categories are significant and come into effect almost immediately (May 16th 2012).

Deep Concerns

At first reading I am extremely concerned about how these changes will affect those who have already paid the NZ government $780 to lodge their applications.

It appears that applications on hand, especially those in the Sibling and Adult Child category, have been relegated to a point in the queue which can never be reached because categories in front of them will be constantly replenished (and over-subscribed) meaning these applications may never be processed.

If this is the case I shall be investigating the legal position on this – taking money for services which will never be provide (even services which will be provided in ‘several years’) is likely to be  a serious breach of contract and deeply unfair.

Parent Category

Closure

The Parent Category will close from May 16th 2012 until July 2012 (date yet to be decided) at which time the new rules will be in place. The new rules will implement a fresh two-tier system with the same quota for parents of around 4,000 places per year.

Requirements on health and character will not change but an English language requirement has been added and the ‘centre of gravity’ rules changed. Parents will not be able to have any dependent children.

A two-tier system The Parent Category is currently run on a two-tier system splitting the quota between the fast tracked Parent Retirement Category (which includes a requirement for $1.5 million in settlement and investment funds) and everyone else.

The Parent Retirement Category will remain relatively unchanged, but changes implemented from May 16th create a new two-tier system within the other Parent Category:

  1. Tier 1 requirements:
    • have a guaranteed lifetime minimum income of NZ$27,203 per annum for a single person or $NZ39,890 per annum for a couple, or
    • bring at least NZ$500,000 in settlement funds to New Zealand, or
    • have a sponsoring adult child who has an annual income of at least NZ$65,000, or joint income of NZ$90,000 when combined with their partner’s income.
    • Tier One applicants will not be subject to a “centre of gravity” test whereby the number of adult children in New Zealand need to be at least as many as the adult children in the home country.
  2. Tier 2 requirements:
    • Tier two applicants must have a sponsoring adult child who hasan income of at least NZ$33,675 per annum, and
    • Any other children the applicant has must live outside the countryin which the applicant lives.

The effect of changes

For most parents this change to the Parent Category will cause very little difference.

The Parent Category already plays second fiddle to the Parent Retirement Category (for parents with $1.5 million in their pockets) which has first bite at places in the quota). In my experience almost all parents will have a pension, settlement funds, or children earning a reasonable salary.

The main change is for the sponsor as they will now be responsible for covering any costs to government of their parents for ten years instead of five.

I can’t imagine this will make much difference to government costs as in the last census migrants (as in all migrants including parents) were shown to contribute over $3,000 to the economy each per year. Rather than acting as a drain migrants actually add wealth.

An extra tax on migrants

One of the changes made to the Parent Category that will create a difference is the introduction of an Expression of Interest costing $420 to be made prior to any application. The reasons for this are officially given as:

The extra NZ$420 fee for Parent Category EOIs pays for the work INZ undertakes in processing them. This work is separate from the work done in processing Parent Category applications, so INZ needs to charge a separate fee for it.

This is not correct.

The immigration department’s costs of processing applications are met by fees collected from migrants. Until recently the amount being paid by migrants always met the costs of the INZ meaning that the amount being charged to migrants was about right.

However from January 2010 policies were introduced by the then Immigration Minister Jonathan Coleman which intentionally cut the department’s income through reducing the number of applications accepted through the Skilled Migrant Category by nearly a third.

The effect of this change was naturally a deficit calculated by the department to be likely to reach $44 million by the end of June.

I was wondering how the department was going to recoup this massive sum, nearly a quarter of their annual budget, and here is part of their answer: an EOI system which is effectively a new tax on migrants.

A long wait for Tier-2

As I mentioned in my article on the changes to the Sibling/Adult child category the quota for the sibling and adult child component of the Capped Family stream is being stripped away. Applications already entered will be processed in date order if there are any spaces left after Tier-1 of the Parent Category has been filled.

This means a wait of potentially several years for the over 6,000 sibling and adult child applications currently held by the immigration department.

The wait for Tier-2 of the Parent category is likely to be even longer as these will be added to the back of this existing queue which will be processed in date order.

As a result it is likely  that any Tier-2 application entered after July 2012 when this stream reopens will wait at least several years to be allocated a case-officer to process what are generally fairly simple cases for healthy applicants who can demonstrate their relationship to their sponsor.

Links:

Sibling/Adult Child Category

Closure

This category will be closed from May 16th and no applications will be accepted after the 15th.

What happens to existing applications?

The INZ have confirmed that applications entered before 16th May will be processed, unfortunately it looks like this is going to take longer than expected. A lot longer.

For the past couple of years applications have sat gathering dust for an average of 2 years before a case-officer was allocated and processing could begin. This was causing some problems for applicants because during that time while they needed a job offer which would stay open for them they had no right to be in New Zealand unless they could get some other temporary visa to allow them to work.

That ‘two years’ just turned into ‘several years’ because of the changes announced today.

The new Parent Category will have a quota of approximately 4,000 people per year, a drop from the old Capped Family Category quota of between 4,950 and 5,500 per year as only the parent quota remains.

That quota will be initially filled with Tier-1 Parent Category applications. If the quota is not filled then other applications will be collected to meet the difference:

Existing Sibling and Adult Child applications will be processed with other Parent Category applications in date order, only after tier one Parent Category EOIs and if numbers allow.

A long wait

The number of applicants with the immigration department for what is now the old Capped Family Stream (parent, sibling and adult child) has been steadily rising despite the best efforts of the department for years because numbers being entered were higher than the quota.

The most recent immigration department figures available (January 2012) show 6,028 applications on hand for this stream.

How long it will take to clear this backlog is anyone’s guess, but it is likely that it could take a very long time indeed. Requirements for Tier-1 of the new Parent Category are likely to be met by the parents of skilled migrants who have sold a home to come to New Zealand or draw an overseas pension meaning that it is possible that the quota of 4,000 people (i.e. 2,000 couples) will be filled every year leaving no space for these older applications. Certainly in recent years this quota has been oversubscribed by parents.

The result of taking away the quota for siblings and adult children, squeezing this in to any gap left in the parent category, will be that thousands of people who have entered applications in good faith will now have to wait considerably longer for their applications to be processed.

Many will be forced to give up their plans of living in New Zealand if they cannot use the Skilled Migrant Category or face living in limbo for what is likely to be several years.

For parents falling into the new Tier-2 stream the situation appears to be even worse. Their applcations will be added to the 6,028 and processed in date order. Any new applicants will know that they have at least 6,000 other people standing in front of them in the line and are unlikely to reach the head of that queue in their lifetime.

Why government could not have continued processing applications in the same way without accepting any more I don’t know, but I suspect that it has something to do with the immigration department’s deficit and a need to reduce operating costs.

As that deficit was created intentionally as a result of policies introduced by the last Minister this knock-on effect is particularly unfair and may well cause many skilled migrants to change their plans about moving to New Zealand.

Links:

Discussions on these changes can be posted here or on move2nz.com.

Mike
move2nz.com

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