Scott Morrison (Cook, Liberal Party, Shadow Minister for Immigration and Citizenship) Share this | Link to this | Hansard source

I am pleased to rise to speak on the Migration (Visa Evidence) Charge Bill 2012 and the Migration (Visa Evidence) Charge (Consequential Amendments) Bill 2012 and to indicate the coalition will not be opposing these bills.

The bills were referred to the Joint Standing Committee on Migration because the coalition had some concerns about the modelling that had been used and the lack of detail provided to explain this modelling. We were also concerned about whether there would be any unintended consequences in relation to access to education and Medicare entitlements to visa holders. The committee has now completed its advisory report, which largely addressed the issues that the coalition had raised, and I thank the committee for their work. In particular, we are satisfied with the department's reassurances that the impact on visa holders access to services will not be compromised. We are also pleased to note that humanitarian entrants and some others will be exempt from the fee completely. We also note there will be a differentiated fee structure in place to allow for upward adjustments of the introductory flat fee of $70. The committee made two recommendations which we also support: first, that DIAC provide greater detail in the explanatory memoranda to more clearly explain the policy rationale and costing methodology; and, second, that the bills be passed without amendment. The stated reason for the bills is to introduce a charge for requests for evidence of a visa and is intended to discourage reliance on visa labels by immigration clients and foreign officials and to promote the use of online visa validation under the Visa Entitlement Verification Online or VEVO.

The coalition are very supportive of a shift in favour of electronic visa handling and had a record of this in government. We are pleased that the government have indicated that this is the direction in which they are also heading. We are also pleased to see that the department is actively engaged in plans to promote the uptake of VEVO and is working with other countries to clarify Australia's visa requirements. The moves are important if the purpose of these bills is to be realised and the coalition support these plans. We are also pleased the government have signalled that the Department of Immigration and Citizenship will be moving closer toward a user-pays model with respect to these matters and on the face of it that seems to be a sensible approach. The bill feeds into some very important discussions that I would like to address today surrounding the economic nexus between immigration, customs, and quarantine operations, as our principal border agencies. There are three elements that warrant particular consideration in this place in the context of this bill: future trends and visa management; the revenue raising of border agencies and our ability to support our border agencies; and fiscal responsibility, more broadly, in relation to the immigration portfolio, which in part,, has demanded the need for the measures that are before us today. This bill will impose a $250 charge limit for request for visa labels to be inserted into a visa holder's passport. As noted earlier, the introductory flat-rate fee will be $70 and some visa classes will be exempt from the fee. Importantly, the bill will allow for future increases in that fee if a stronger price disincentive is required to further discourage requests for visa labels. The intent here is to discourage reliance on visa labels and the increased use of electronic systems to validate a non-citizen's right to enter Australia. This bill signposts an important shift in thinking within the immigration portfolio from hardcopy, paper based applications to more sophisticated, more efficient and more effective online management. According to the government's figures a total of 1.365 million visa labels were issues over calendar year 2011. By any measure, this represents an incredibly high volume of service undertaken at immigration counters in Australia and our missions overseas. The government has apparently made previous attempts to reduce the demand for hardcopy visa labels in the past with little success. In the absence of any requirement for individuals to have a hardcopy visa the proposed fee represents a strong price signal to discourage unnecessary service.

Based on the estimated revenue of $90 million over three years, I note that the government is estimating that the number of evidences would decline by more than 90 per cent to 120,000 per year. I think this is a very ambitious estimate, and if not realised would deliver a significant revenue windfall. Like every other estimate this government tends to make in terms of its budget, it would be foolish to bank on it until we actually see the revenue generated. With ever-improving technology and amassing intelligence databases, the ability to use electronic matrices to process, scrutinise and manage visas across the board should be used to as great an extent as possible, and this reflect coalition policy. We should be exploring opportunities to advance and build upon our current systems with the goal of making them more robust and with greater integrity. I encourage the government to pursue these measures enthusiastically.

The electronic lodgement of visa applications in particular correlates very strongly with achieving border management objectives by streamlining entry processes, significantly reducing the cost of border management while at the same time, I believe, providing the tools to better manage our borders from a nation security perspective. In Australia at present, excluding the Electronic Travel Authority, around 30 per cent of visa applications are submitted electronically from offshore. The rest are done in the old-fashioned way: by paper and snail mail. That is not a figure that the government should be proud of or this parliament should be proud of. For many visa categories there is no option to apply electronically; applications must be done by hardcopy. I understand why on specific occasions that is necessary, particularly in terms of verification. However, maximising the use of electronic lodgements, backed up by effective risk profiling, is the way forward for border security, efficiency, and fiscal responsibility. This approach will yield significant benefits not only for DIAC but for other agencies as well. While this bill on its own may be small, if this is an indication of a much bigger shift in thinking towards electronic processing and immigration then I consider this to be a positive sign and the coalition support this attitude.

The management of Australia's borders is highly complex and involved. Our agencies seek to coordinate the movement of both people and goods in and out of our country, and to ensure lawful regulation and governance of each person, and each parcel for that matter. As an island, we face cross-border threats from not only crime, terrorism, drugs and immigration fraud but also pests, diseases and people smuggling. The success of our border protection operations has wide-reaching ramifications. It is critical to our national security, while the seamless flow of people and cargo is vital to our continued success as an open-trading economy. Naturally, it involves cooperation and coordination to the highest degree and under a broad range of circumstances between the three key, primary border agencies who work in this critical space and, in many cases, share joint responsibilities. Collectively the Department of Immigration and Citizenship, the Australian Customs and Border Protection Service and the Australian Quarantine and Inspection Service employ 17,428 staff, and cost almost $4.4 billion per year to run in this current budget year. If we exclude non-border services such as the Cultural Diversity and Settlement Services program managed by the Department of Immigration and Citizenship then we are looking at a cost across these three agencies of around $3.9 billion in 2011-12 and a staff of around 16,000 over these three agencies. These agencies are tasked to control the flow of people, goods, flora and fauna and any other biological matter across our borders. Failure to resource these national functions has serious consequences for our national security, our economy and our environment. It pays us to get this right, so the move towards these fee services is a way of ensuring that we can do just that. There are opportunities to raise revenue within each of these portfolio agencies. Naturally, there are also costs that must be met — much greater for some outcomes and outputs of these agencies, within their output classes, than for others.

There are serious issues that have consequences for national security, and obviously there are elements of expenditure that cannot be compromised. Inputs and outputs need to be carefully managed. Australia's border agencies operate as key revenue generators and collectors for the Commonwealth across the spectrum, collectively raising billions of dollars from administered and own-source revenue, excise and customs duty, visa application charges, passenger movement charges and an array of import processing charges. Had the government's proposal, which was considered by the House yesterday, to increase the passenger movement charge actually been about genuinely funding border control functions, and directly into those functions, rather than being a naked tax grab, perhaps it would have had more merit.

It follows that where there are opportunities within these areas to raise revenue and find more efficient ways of doing more with less, and doing it more effectively with less, we should be making the most of those opportunities. We should also be ensuring that these resources go into funding our border control operations, not the government's largesse. The net border cost to taxpayers, notionally, for our three border agencies in 2011-12 — taking into account other service related incomes, currently represented and administered in own source income within the budget, and for things such as the visa application charges and the charges and fees that are the subject of this bill—was estimated at $2.2 billion. So we are a long way shy of self-funded border agencies in this country.

Over the forward estimates, immigration and citizenship represents the dominant component of our border related expenditure. We should be charging market value and we should be competitive but, at the same time, we must be conscious that there are costs that must be met. In his second reading speech, the minister—who is here with us—admitted that the Migration (Visa Evidence) Charge Bill is unashamedly designed to generate revenue, and I hold nothing against him for that goal; that is its purpose, as well as the purposes we have talked about here today. That is a fair enough goal when this revenue is going directly into the government's agency to perform these tasks.

It is estimated and expected the measures proposed in this bill will generate $90 million in revenue of three years. But, as I indicated before, I suspect that this is a very modest figure and has been significantly underestimated. The minister claims that the modelling undertaken by the department confirms that the charge will have minimal impact on the education, tourism and employment sectors and that immigration clients will eliminate the current financial burden that visa labels impose on the Australian taxpayer. On that basis, that the impact is as is claimed, the coalition does not oppose these bills. However, we do look to the committee report continually in terms of how these matters can be managed in practice.

While the coalition supports these measures and whilst the moving towards a user-pays model is undoubtedly important, it is a terrible shame that the revenue raised will be simply overwhelmed by the department's rising costs, courtesy of the government's border protection failures. More than 2,000 people have arrived now since the government handed down its budget just six weeks ago. That is more than three times the rate of arrivals that were estimated in the government's budget.

We also have a new front opening up in terms of border protection issues in the Cocos and Keeling Islands. The establishment and setting up of a facility in the quarantine station, the deployment of additional resources, maritime assets for customs and border protection and the other costs of charter services and matters related to that will only add further to the costs the department is going to face. It is a shame that the $90 million raised from this measure in the three years will be spent in just 90 days to pay for the already budgeted blow-outs for the 2012-13 year. That will be $1.1 million to be paid out each and every day in the next financial year on the government's current budget before they will inevitably have to revise it, compared to the figures that were put before this parliament a year ago. The figures for next year are up $424 million for 2012-13 in terms of what was handed down in the 2011-12 budget. That is $1.1 million each and every day that taxpayers will be paying. So the revenue raised in this measure before us today will be swallowed up in less than 90 days, even though that revenue will be raised over three years, because of the failures of the government's border policies.

More than 19,000 people have arrived since the Labor government decided that it was a good idea to get rid of the solutions imposed by the Howard government that had worked and were working. It is estimated that those 19,000 people have provided around $190 million—that is gross revenue based on the $10,000 per person fee, charge, price or ticket paid for by these individuals which has been confirmed via entry interviews and in evidence before Senate estimates—into the pockets of people smugglers like Captain Emad, and now Captain Ewaz and how ever many more captains are out there in this battalion of people smugglers that are moving onshore. This is the revenue that they are raising courtesy of this government's border policies.

We have seen blow-outs occur in the past and I have no doubt that we will continue to see blow-outs occur, given the rate of arrivals since the budget is three times what was estimated by the government. The existing blow-out of $4.7 billion to date from the last three years will only be added to as the government once again faces up, as they do with every MYEFO, to tell us that it is all going to cost a lot more. In the past year at the portfolio additional estimates there was a blow-out of $866 million. Since those portfolio additional estimates there has been a further blow-out of $840 million, as presented in the budget just six weeks ago. There was a blow-out in those figures also of over $220 million between November when they first considered the papers and the publication and review of those at the additional hearings in the Senate. When it comes to border protection failures, the costs only go in one direction under this government, and that is up. The revenue is taken and put in the pockets of people smugglers like Captain Emad and Captain Emaz under this government. Some of these alleged people smugglers are sail-in fly-out—they are our new SIFO, like Captain Emad. It is estimated they have put in their pockets something in the order of up to $190 million over the last few years.

They will keep arriving and they will keep coming as long as this government is in office and as long as they remain the government that they are. It is not just Labor's failed policies that are a problem on our borders anymore; it is the Labor party themselves that is the pull factor. This Labor government have become their own pull factor for boat arrivals. Their soft-touch reputation has gone global and it has gone viral around the world. That is why we continue to see the arrivals that we see. If the government are serious about saving taxpayers' money and generating efficiencies in the immigration budget then it should adopt good policy not pursue failed policy and untested policy. The coalition's policy has been set out now for over a decade on these matters, but sadly, I fear that any policy this government might seek to introduce on the matter of our borders will fail, because it will be overwhelmed by the enormous pull factor presented by their own presence in office.

Tony Zappia (Makin, Australian Labor Party) Share this | Link to this | Hansard source

I speak in support of both the Migration (Visa Evidence) Charge Bill 2012 and the Migration (Visa Evidence) Charge (Consequential Amendments) Bill 2012. This legislation was in fact referred to the Joint Standing Committee on Migration. The chair of that committee and the deputy chair in presenting our response to the referral to the committee spoke on these bills on Monday. Effectively, the committee recommended passage of the legislation. It did so after a brief inquiry in which information was sought from the department. In fact, some 13 questions that go into the very detail of the contents of this legislation were raised with the department, and the department kindly responded to those questions and enabled the committee to prepare its response. Having listened to the members opposite and in light of the recommendations of the committee, I have no doubt whatsoever that this legislation ought to be supported.

The legislation deals with a couple of critical matters. The visa charge bills amend the Migration Act 1958 to introduce a charge for requests for evidence of a visa issued as validation of noncitizens' immigration status and entitlements in Australia. The Migration (Visa Evidence) Charge Bill 2012 introduces a charge with the maximum limit of $250 for requests for visa evidence and a method for indexation of that charge. The Migration (Visa Evidence) Charge (Consequential Amendments) Bill 2012 provides for regulations to implement and calculate charges for different forms of visa evidence and visa classes. The new charge is intended to encourage visa holders to use the department's online visa entitlement verifications system, otherwise known as VEVO, for visa validation. The measure will also support immigration processing during the transition to labels-free travel based on electronic verification. Currently visa evidence is provided without a fee which imposes an administrative and cost burden on the Department of Immigration and Citizenship.

In his first reading speech, the minister made the point that during 2011 some 1,365,000 requests were made for onshore and offshore visas. That was made up of 455,000 onshore and 910,000 offshore visa requests. That is a lot of applications. Further, the processing of these visa evidence requests is the highest volume service conducted at immigration counters both in Australia and overseas. Their requests may be made at the time of the visa being issued or later, and the visa evidence is issued without cost to the visa holder. It is effectively to address those issues that this legislation is being brought in because once the legislation is brought in I have no doubt that it will discourage the reliance on visa labels, which are being sought right now by people who apply for visas. Whilst I can understand why those visa labels are being sought because in some cases they need to be used as additional proof of people's status, the reality is they do not need them anymore, particularly if they go to the online visa verification system that is being proposed. That is the way of the future, so it makes absolute sense to start saying: 'You have an alternative. If you want to continue to apply for visa labels then because of the cost burdens that are being imposed on the department, it is only fair and reasonable to seek to recoup the costs that are being incurred by government for the provision of that service.' My understanding is that the changes proposed will be implemented over the next 18 months and it is not the case that in all cases fees will rise. I understand that in some cases—perhaps relating to students and other cases that I am aware of—the fees in fact might be either waived or reduced.

I wanted to address one of the matters that was touched in the response to the committee's inquiry by the deputy chair in her remarks to the chamber which related to the cost of the visas. The department's advice to the committee revealed that the $250 limit and the highly differentiated fee structure are in place as a framework for the upward adjustment of the $70 charge. I want to specifically quote a section of the committee's report in respect of this. Section 3.35 says:

It is proposed that the Migration Regulations will be amended to initially set the VEC at $70 for the provision of evidence in the form of labels. The Migration (Visa Evidence) Charge (Consequential Amendments) Bill 2012 provides that the Migration Regulations will be able to set different charges for different circumstances and classes of visa, and for a method of calculation to be developed to allow this. This has been included to give flexibility to increase the $70 in some circumstances if it does not succeed in reducing reliance on visa labels. These provisions also enable the charge to be set at a higher rate, if required, to process a label quickly outside of normal processing times.

That is a direct response from the department to a question that was raised by the committee. Section 3.39 of the committee's report says:

The current Visa Application Charge cap is around four times the price of the average migration fee, and this was used as a guide when setting the limit for the VEC, with $250 being just over four times the then proposed VEC of $60. It was not proposed to the Government that the VEC cap be charged – it is a cap on price to prevent arbitrary taxation, not a price itself.

I use those quotes to try and explain how the fees were arrived at, given the comments that were made in the committee's discussions. There was also some questioning of how the $90 million amount was arrived at. My understanding is that the amount is actually $600 million, and perhaps the minister, being here, might like to comment on that. That would in turn explain the difference in the drop that is expected as a result of these new processes coming into effect.

In closing, there is every likelihood that in the future we will see more and more people apply for visas to this country for a whole range of reasons, not least of which is that international travel is becoming easier and easier as the years go by. For those reasons, it makes good sense to have in place a system that is more efficient and recoups the cost that the government will undoubtedly incur as a result of that increased travel. I commend the legislation to the House.

Teresa Gambaro (Brisbane, Liberal Party, Shadow Parliamentary Secretary for Citizenship and Settlement) Share this | Link to this | Hansard source

I also rise to make a brief contribution to the Migration (Visa Evidence) Charge Bill 2012 and Migration (Visa Evidence) Charge (Consequential Amendment) Bill 2012. As indicated by my colleague the shadow minister for immigration and citizenship, the coalition do not oppose the bills. As explained by the explanatory memorandum, the intent of the bill is to amend the Migration Act 1958 to introduce a charge for request for evidence of a visa issued has validation of a non-citizen's immigration status and entitlement in Australia. The Migration (Visa Evidence) Charge Bill 2012 introduces a charge with a maximum limit of $250 for a request for visa evidence and a method for indexation of that charge, and the Migration (Visa Evidence) Charge (Consequential Amendment) Bill 2012 also provides for regulations to implement and calculate charges for different forms of visa evidence and visa classes. The reasoning behind these changes is to encourage visa holders to use the Department of Immigration and Citizenship's Visa Entitlement Verification Online, VEVO.

The current situation is that visa evidence is provided without a fee, which imposes a huge administrative and cost burden on the Department of Immigration and Citizenship. The idea is that if a visa holder has to pay a fee to get a hardcopy of the visa evidence, they will be far more likely to use VEVO than request the hardcopy evidence. In the second reading speech for the Migration (Visa Evidence) Charge Bill 2012, the Minister for Immigration and Citizenship, the Hon. Chris Bowen MP, advised that one-third of visa holders request hardcopy evidence of their visa and during 2011 this amounted to a staggering 1.365 million requests, broken down into 455,000 onshore and 910,000 offshore. The coalition are supportive of the concept of ensuring greater efficiency within the department through the promotion of an online mechanism. The Joint Standing Committee on Migration conducted a brief inquiry into the particular bill. One of the aspects the committee sought advice on was the consultation undertaken by the department to assess all the negative impacts on particular sectors. It was particularly interested in the transition to a visa label free travel. As the committee report states:

In addition to the request made at the time of issuing a visa, visa labels may also be requested at a later time. Resident non-citizens may make these requests for a range of reasons such as the perceived need for evidence for work entitlement, Medicare Centrelink benefits, for proof to third parties or foreign embassies of the right to return to Australia, or simply as a souvenir.

Additionally, offshore visa applicants may require hardcopy visa evidence to comply with local laws to exit or transit to another country. In these circumstances a migration officer may make the request on their behalf or if there are special requirements, such as for processing humanitarian visas.

The Department noted that while the number of visa requests seems high, requests for hard copy evidence accounts for only one third of the total visa caseload. The remaining two thirds of the visa caseload are processed without a hardcopy visa label electronically.

So essentially the rationale is that if two-thirds of the visa holders can use the VEVO then surely a large percentage of the other third can also be encouraged to by introducing a charge. The department also advised that the pricing model introduced under visa pricing transformation is consistent with international benchmarks for visa and associated services. I did have concerns about how these charges might affect adversely or disproportionately certain categories of visa holders or those from different countries where they have to have a hard-copy visa. But, as the committee report said, in evidence the department gave reassurances that a growing number of countries are now allowing nationals to exit or transit their country without a visa label. DIAC is also actively promoting the message that Australia does not require a person to have a visa label in their passport to travel to, enter or remain in Australia. I am really pleased to see, however, that it is proposed that the charge be waived for humanitarian entrants, among other specified groups.

The other aspect of the bill that I have a concern with was the modelling, particularly the modelling the department used to predict the revenue that would be generated and the subsequent decrease in the use of hard-copy visa evidence. The department told the committee that the initial decline of 40 per cent was modelled, increasing to a 55 per cent drop over four years. I was really pleased that the department was able to come back to us with those figures. The committee and the coalition accept the department's explanation, and I commend the bill to the House.

Chris Bowen (McMahon, Australian Labor Party, Minister for Immigration and Citizenship) Share this | Link to this | Hansard source

I thank honourable members who have contributed to this debate, particularly the honourable member for Makin for his learned and considered approach in his work on the committee on this. He has clearly given these matters a lot of thought. I also thank the member for Brisbane for a likewise thoughtful approach. I note the contribution of the member for Cook, which was heavier on rhetoric than substance, but I do note his contribution. I thank the honourable members for their comments.

As honourable members have said, this bill presents a package that will enable the government to impose a charge for the production of visa evidence. This is the first of a series of new related charges to be implemented under the Visa Pricing Transformation Program, which I previously announced as a major reform to the way we price our visas to bring Australia into line with international best practice, ensure our competitiveness and also ensure that taxpayers are receiving an appropriate return for the work that goes into visa processing.

As honourable members have said, visa labels are not required in the vast majority of circumstances, yet a very large number of people still request visa labels for the reasons that the member for Makin and the member for Brisbane referred to—often as simple as requiring a souvenir in their passport of their trip to Australia. While I understand that and respect that, it is not necessarily the job of the Australian taxpayer to subsidise that, so it is appropriate that a charge be in place to say to people, 'If you want that souvenir there is a cost to it, and this is the cost.' The cost has been announced in the budget at $70 per visa label. We believe that is an appropriate cost. This would encourage clients and stakeholders to use electronic confirmation of a person's visa as the primary driving force behind the introduction of the visa evidence charge. The money raised is substantial. That is appropriate, and we make no apologies for that. It is substantial based on the fact that these are not labels that are required in the majority of circumstances. Our substantial consultation shows no or limited impact on those key markets to the Australian economy: tourism, students et cetera because they are not requirements under any of those visas for travel to Australia. Therefore this is a sensible bill. I welcome the support of the opposition. I thank honourable members for their contribution and commend the bill to the House.

Question agreed to.

Bill read a second time.

Ordered that this bill be reported to the House without amendment.