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2016 - 2017
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
MIGRATION (SKILLING AUSTRALIANS FUND) CHARGES BILL 2017
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Immigration and Border Protection,
the Hon. Peter Dutton MP)
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MIGRATION (SKILLING AUSTRALIANS FUND) CHARGES BILL 2017
OUTLINE
The Migration (Skilling Australians Fund) Charges Bill 2017 (the Bill) imposes a
nomination training contribution charge payable by persons who are liable to pay the
charge under the Migration Act 1958 (the Migration Act) and the Migration Regulations
1994 (the Migration Regulations). The nomination training contribution charge will
offset expenditure from the Skilling Australians Fund, a training fund administered by the
Department of Education and Training (DET), to support skills development of
Australians.
This Bill is to be read in conjunction with the Migration Amendment (Skilling Australians
Fund) Bill 2017.
FINANCIAL IMPACT STATEMENT
The training contribution charge imposed by this Bill is expected to generate revenue of
$1.2b over the forward estimates. Expected expenditure from the Skilling Australians
Fund over the forward estimates is $1.47b.
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
A statement of compatibility with human rights has been prepared in accordance with
Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 and is at Attachment A.
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MIGRATION (SKILLING AUSTRALIANS FUND) CHARGES BILL 2017
NOTES ON INDIVIDUAL CLAUSES
Part 1 - Preliminary
Clause 1 Short Title
1. The short title by which this Act may be cited is the Migration (Skilling
Australians Fund) Charges Act 2017.
Clause 2 Commencement
2. Subclause 2(1) sets out when the provisions of the Act commence.
3. Clauses 1 and 2 of the Act will commence the day the Act receives the Royal
Assent.
4. Clauses 3 to 10 of the Act will commence at the same time as Schedule 1 to the
Migration Amendment (Skilling Australians Fund) Act 2017 (the Amending Act)
commences. Schedule 1 to the Amending Act will commence on a single day or
days to be fixed by Proclamation, unless the provisions do not commence within 6
months of Royal Assent, in which case they commence on the day after the end of
that 6 month period.
5. Subclause 2(2) provides that any information in column 3 of the table is not part
of this Act. Information may be inserted in this column, or information in it may
be edited, in any published version of this Act.
Clause 3 Act binds the Crown
6. This clause makes it clear that the Act binds the Crown in right of each of the
States, of the Australian Capital Territory and of the Northern Territory. The
effect of this is that the States and Territories will be liable to pay the nomination
training contribution charge as required by the Migration Act.
7. Although this clause provides that the Act does not bind the Crown in right of the
Commonwealth, item 5 of Schedule 1 to the Amending Act inserts new section
140ZP to notionally apply the nomination training contribution charge to the
Commonwealth.
Clause 4 External Territories
8. This clause makes it clear that the Act applies to an external Territory that is a
prescribed Territory within the meaning of subsection 7(1) of the Migration Act.
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This is consistent with current subsection 7(1) of the Migration Act, which
extends the Migration Act to prescribed Territories.
Clause 5 Extra-territorial operation
9. This clause provides that the nomination training contribution charge is payable
regardless of whether the nomination is made in or outside Australia, and whether
the person who is liable to pay the charge is in or outside Australia. This ensures
that a person who is liable to pay the nomination training contribution charge
under the Migration Act cannot avoid liability by lodging nominations from
outside Australia.
Clause 6 Definitions
10. This clause defines a number of terms used throughout the Act.
11. The term amount is defined to include a nil amount. The effect of this is that the
nomination training contribution charge payable under Migration Act or
Migration Regulations may be set at zero.
12. The term Migration Act means the Migration Act 1958.
13. The term nomination means a nomination of the kind mentioned in new
subsections 140ZM(1) or (2) of the Migration Act, as inserted by the Amending
Act. New subsections 140ZM(1) and (2) set out the nominations in relation to
which the nomination training contribution charge is payable.
14. The terms permanent visa and temporary visa have the same meaning as in the
Migration Act.
Part 2 - Nomination training contribution charge
Clause 7 Imposition of nomination training contribution charge
15. This clause imposes the training contribution charge, as payable under new
section 140ZM of the Migration Act, as inserted by the Amending Act.
Clause 8 Amount of nomination training contribution charge
16. This clause, subject to clause 9, sets out the nomination training contribution
charge amount.
17. Subclause 8(1) provides that the nomination training contribution charge
payable is the amount prescribed by the regulations, or worked out in accordance
with a method prescribed by the regulations. The intention of this clause is to
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enable regulations to be made to prescribe the amount, or to prescribe a method
(such as formula or a series of calculations) to work out the amount.
18. Subclause 8(2) allows the regulations to prescribe different charges or methods
for different kinds of visas, or different kinds of persons. For example, the
regulations may prescribe different charges in relation to temporary visas than the
charge payable in relation to permanent visas. Also, the regulations may prescribe
different charges or methods depending on, for example, the annual turnover of
the employer in relation to which the nomination relates.
19. Subclause 8(3) ensures that the amount prescribed or calculated in accordance
with a prescribed method cannot exceed the charge limit for the financial year in
which the nomination is made, as determined in accordance with clause 9.
Clause 9 Nomination training contribution charge limit
20. This clause sets out the maximum amount of nomination training contribution
charge payable.
21. Subclause 9(1) provides that the charge limit for a nomination made in the
financial year beginning on 1 July 2017 is $8000 for a nomination relating to a
temporary visa, or $5,500 for a nomination relating to a permanent visa.
22. For temporary visas, the intention is the nomination training contribution charge
payable will be calculated according to the number of years, or part thereof, set
out in the nomination. The charge limit for temporary visas is therefore
calculated with reference to the proposed nomination training contribution
charge for a large business of $1,800 for each year of nomination, for the
maximum visa duration of 4 years ($7,200).
23. The charge limits in subsection 9(1) are approximately ten per cent above the
highest nomination training contribution charge proposed to be prescribed in the
Migration Regulations, being $7,200 and $5,000 for temporary and permanent
visas respectively. These charge limits provide flexibility for the Australian
Government to make increases to the nomination training contribution charge in
the future while providing certainty for business as to the limited scope of a
potential increase.
24. Subclause 9(2) sets out the method for calculating the charge limit for a
nomination made in a later financial year. The charge limit for a later financial
year will be calculated by multiplying the charge limit for the previous financial
year by the greater of 1 or the indexation factor.
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25. Subclause 9(2) also sets out the formula for calculating the indexation factor and
provides definitions for the terms CPI quarter and index number used in the
indexation formula.
26. Subclause 9(3) controls rounding of the indexation factor to 3 decimal places and
provides that the third decimal place should be rounded up if the fourth decimal
place is 5 or more. For example, if, before rounding, the indexation factor is
1.0329 then subclause 9(3) operates to provide that the indexation factor is 1.033.
27. Subclause 9(4) sets out rules about which index numbers should be used in
calculating the indexation factor. Paragraph 9(4)(a) provides that only the index
numbers published in terms of the most recently published index reference period
for the Consumer Price Index (CPI) should be used. Paragraph 9(4)(b) provides
that index numbers published in substitution for previously published index
numbers should be disregarded. The rule in paragraph 9(4)(b) does not apply
where the substituted numbers are published to take account of changes in the
index reference period. Subclause 9(4) reflects the policy intention that consistent
CPI figures are used to index the charge limit from one year to the next.
28. Subclause 9(5) provides that the charge limit is to be rounded to the nearest $5
when it is indexed each financial year. For example, paragraph 9(5)(a) provides
that an unrounded charge limit of $8,264 rounds up to $8,265. Paragraph 9(5)(b)
provides, for example, that an unrounded charge limit of $5,681.50 rounds down
to $5,680.
Part 3 - Miscellaneous
Clause 10 Regulations
29. This item allows the regulations to prescribe matters that are required or permitted
to be prescribed by this Act, or as necessary or convenient to be prescribed for
carrying out or giving effect to this Act.
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Attachment A
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act
2011
Migration (Skilling Australians Fund) Charges Bill 2017
This Bill is compatible with the human rights and freedoms recognised or declared in the
international instruments listed in section 3 of the Human Rights (Parliamentary
Scrutiny) Act 2011.
Overview of the Bill
This Bill relates to the Migration Amendment (Skilling Australians Fund) Bill 2017
(Amending Bill). The Amending Bill provides a framework for the collection of the
nomination training contribution charge from employers accessing workers under the
temporary and permanent employer sponsored migration programmes.
The purpose of this Bill is to impose the nomination training contribution charge payable
under new section 140ZM of the Migration Act 1958 (the Act). This nomination training
contribution charge will be payable by persons seeking to nominate a worker for a visa
prescribed in the Migration Regulations 1994 (the Regulations). It is intended that the
visas that are to be prescribed are the:
Temporary Skill Shortage visa, which is to replace the Temporary Work (Skilled)
Subclass 457 visa (457 visa);
Employer Nomination Scheme (ENS) (Subclass 186) visa; and
Regional Sponsored Migration Scheme (RSMS) (Subclass 187) visa
The Bill sets a charge limit for the nomination training contribution charge, makes
arrangements for an annual indexation of the charge limit and provides that the
nomination training contribution charge must not exceed the charge limit. It also
provides that the amount of the nomination training contribution charge is to be
prescribed in the Regulations, and that the Regulations may prescribe different charges
for different kinds of visas or persons.
The nomination training contribution charge replaces current requirements that employers
sponsoring a worker for a 457 visa or nominating a worker under the Direct Entry stream
of the Subclass 186 visa have recently spent:
the equivalent of at least two per cent of their business' payroll in contributions to
an industry training fund (training benchmark A); or
the equivalent of at least one per cent of their business' payroll on the training of
Australians (training benchmark B)
Human rights implications
Together with the Amending Bill, this Bill contributes to the provision of training
opportunities for Australian citizens and permanent residents by establishing the
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framework for the nomination training contribution charge, to be paid by employers
accessing workers under the temporary or permanent employer sponsored migration
programmes.
The nomination training contribution charge will fund initiatives which improve training
opportunities and outcomes for Australian citizens and permanent residents. Such
initiatives engage Articles 6.1 and 6.2 of the International Covenant on Economic, Social
and Cultural Rights (ICESCR). Article 6.1 of ICESCR recognises:
The right to work, which includes the right of everyone to the opportunity to gain
his living by work which he freely chooses or accepts, and will take appropriate
steps to safeguard this right.
Article 6.2 of ICESCR states that:
The steps to be taken by a State Party of the present Covenant to achieve the full
realization of [the right to work] shall include technical and vocational guidance
and training programmes, policies and techniques to achieve steady economic,
social and cultural development and full and productive employment under
conditions safeguarding fundamental political and economic freedom to the
individual.
The measure in this Bill supports the right to work under Article 6.1 for Australian
citizens and permanent residents. Funding a national training partnership through the
sponsorship and nomination framework is an effective mechanism to promote training
across a broad range of industries and occupations. The measure positively engages
Articles 6.1 and 6.2 of the ICESCR as it is a mechanism for Australia to comply with
these rights.
It is intended that the Regulations will prescribe different amounts of training
contribution charge payable by the nominating employer depending on the type of visa
sought, the nomination period and the size of the nominating employer's business (in
terms of annual turnover). Any human rights implications of this aspect of the measure
will be addressed in the Statement of Compatibility that will accompany the Regulation
amendments.
Conclusion
The Bill is compatible with human rights. It does not limit any of Australia's human
rights obligations and it promotes the training of Australian citizens and permanent
residents in support of Article 6 of the ICESCR.
The Hon. Peter Dutton MP, Minister for Immigration and Border Protection