Immigration

INTRODUCTION

Tena koutou katoa, nga mihi nui kia koutou.

Thank you very much for the introduction, Alan and to your team, thank you for inviting me to speak to your members.

This is a really fantastic opportunity for me, for the first time, to set out my priorities in the immigration portfolio and give you an insight into some of the important work that is going on at pace.

Immigration is well known for being extraordinarily complicated. It's a portfolio where every little detail matters as there are far reaching consequences for any wrong move, with competing interests to carefully balance, and that no matter how hard you try, it's not possible to please everyone.

Decisions made by immigration change the course of peoples' lives and needs to support our businesses to proposer. For all its challenges, it's long been a portfolio I love - and in Government that hasn't changed.

My vision is to have immigration settings that are flexible and responsive - a system that is easy to navigate and interact with - where decisions are made in a timely manner - where risk is appropriately identified and well managed - where we direct resource to the place where it is most needed - with a lighter touch in areas where we know we can have more trust.

I have developed an ambitious work programme to deliver on this vision that is based advancing four priority areas:

• Rebuilding the economy and improving our productivity
• Delivering better public services and protecting the integrity of the border
• Attracting top talent and skills, and
• Advancing our international priorities, particularly in the Pacific.

My role as Immigration Minister is to carefully determine policies and settings that find a balance between providing businesses access to the workforce they need to thrive and grow our economy, and ensuring that we are giving kiwis every opportunity to get be in work in the face of rising unemployment. These two competing pressures are ever present in the immigration portfolio and never more so than now, when we need to grow our economy, improve our productivity, increase exports and reduce our job seeker numbers by 50,000 in the next 5 years.

Like many areas, the immigration portfolio is operating with constrained capacity. My work programme is very ambitious - we have a lot to get through and the reality is that we just can't do everything at once.

I've made my expectation clear to my officials about where we need get to and we have mapped out our priorities for delivery over the next few years.

But first, a wee bit of scene setting to give you a picture of the challenges we were facing that needed immediate action and long-term solutions.

WHAT I INHERITED

The Government inherited an immigration system that was clearly under incredible pressure. Despite best efforts, the previous Government's settings weren't right and some of their visa products weren't delivering on what they promised.

NET MIGRATION

When we came into Government, New Zealand was experiencing record numbers in net migration.

In 2023, there was a net migration gain of almost 140,000 people in a 12-month period. Although the numbers are trending downwards after the changes we made to AEWV in April, these monthly numbers far surpassed any previous record and was driven in no small part, by the massive numbers of lower skilled work visa holders coming to New Zealand following the border re-opening.

This was putting completely unsustainable pressure on key services and infrastructure.

What this meant was longer wait times to see a GP, queues in emergency departments, not enough housing, and in an area I know very well - huge demands on our education system with nearly 20,000 students entering the country meaning schools were bursting at the seams, an MOE that couldn't deliver classrooms fast enough, a massive increase in demand for ESOL support and a flood of students with undiagnosed additional learning needs putting a huge strain on an already under pressure learning support system.

Making things even more challenging, was that these record-breaking numbers included a significantly higher proportion of low skilled workers than what we were seeing pre-COVID. While there will always be a need for more entry level positions in certain regions and industries, we know we need a higher proportion of skilled workers to drive our economy and improve our productivity.

Despite the previous Government's best intentions to try to achieve this, which was outlined in their 2021 immigration reset speech, they achieved the exact opposite. Numbers of low skilled and entry level workers surged into the country far far outweighing the numbers of higher skilled migrants.

What this meant for kiwis - was with the flood of migrant workers filling entry level jobs and low skilled roles, MSD told us they found it far more difficult to place kiwis into jobs.

These levels of unsustainable net migration were staying stubbornly high and that was our first priority to sort.

The way the AEWV visa was set up, meant that it just wasn't delivering. The timeframes the previous Government set for processing were never realistic. It was never going to take 10 days to process an employer accreditation, 10 days to process a job check or 20 days to process a visa.

The pressure to move tens of thousands of people across the borders at pace in 2022 resulted in INZ not properly assessing risk, taking shortcuts and taking too many things at face value rather than verifying evidence.

This is problematic at the best of times, but we are not in the best of times. There is a worldwide trend of significant increased risk in the immigration space.

In some cases in New Zealand, the assessed level of risk in specific markets has doubled compared to 2019.

Effectively the previous Government set up a very high trust model in a world that was seeing increased risk. A terrible combination with terrible consequences.

We all saw the widespread and unacceptable migrant exploitation - the stories of 40 men crammed into a house with no work and no food, migrants paying tens of thousands to get into NZ with no genuine job here for them, off shore agent making millions off desperate people just wanting a ticket here.

With our borders effectively compromised, not only did we see a huge uptick in migrant exploitation we have also seen a huge surge in asylum claims - the highest ever recorded with around 2500 claims in the previous 12 months - compared to between 300 to 400 in the past.

80% of the claims are unmeritorious, but it will take years to clear the growing backlog, meanwhile the asylum seekers have an open work visa, the golden ticket - the most prized visa and the probability of being here for years as they lodge multiple claims. They are here because we didn't assess risk properly, where in the past they would have been declined a visa and stayed off shore, now they are here.

The upshot of this is that we have had to significantly bolster the numbers of officers processing these claims, with an extra $10m recently committed to help clear the backlog. Unfortunately the claims keep coming - as those who came in under the lax settings find themselves out of work, or nearing the end of their visa or who have travelled on their visitor visa, continue to do whatever it takes to remain here.

When I said earlier that every decision taken in Immigration has far reaching consequences - this is exactly what I meant. We are paying the price for poor policy settings.

We made sure that getting our settings right was a top priority.

So, this is the context. We now have a social, moral and fiscal responsibility to get this right.

RESPONSE

As you can appreciate - my immediate priorities were to ensure we were properly assessing risk and securing our border. That we were reducing the unsustainably high net migration, adjusting our settings to reduce the levels of migrant exploitation, and restoring checks and balances back into the system to protect the integrity of our borders.

INZ started assessing risk appropriately and took steps to bolster our presence at high-risk airports to offload passengers who should not be travelling to New Zealand.

I also made a series of considered changes to the AEWV to get new migration under control quickly and to reduce migrant exploitation.

AEWV

On 7 April, I announced a package of changes, targeted at lower skilled roles where we know we see a far higher risk of migrant exploitation and far greater numbers entering NZ. For lower skilled roles:

• Required employers to engage with MSD before approval to bring in migrants in lower skilled roles,
• setting a minimum skills or three year relevant work experience
• reduced the maximum continuous stay for most roles from five years to three years,
• introduced a basic English language requirement; and
• Returned to settings that did not allow partners or children to be sponsored

Most of these changes are not new, but are a return to pre-COVID settings, that better balance the needs of business with the wider interests of New Zealand.

The arrival numbers have eased back and the ratio of high to low skill migrants has returned to levels more in line with 2017 and the exploitation we continue to see is predominantly from those who entered the country under the old settings.

However, I was always aware that further work would need to be undertaken on the AEWV. The changes were things we could do quickly to achieve the things we needed to urgently address. It was a blanket approach that was necessary at the time but I appreciate the impacts for some businesses have been significant.

Almost immediately after putting those changes in place we began our work to overhaul the AEWV work visa to ensure that it is fit for purpose and works for you.

While decisions have not yet been taken, I want to give you an idea of the direction of travel so that you know we are carefully considering the needs of business.

This phase of work is intended to result in an AEWV visa that is more nuanced, flexible and responsive to the differing needs of businesses in certain sectors and regions.

I am keenly aware there is a need for entry level workers in certain sectors and in certain regions where there just aren't the kiwis to do the work. I have already engaged with sectors like dairy, wine, seafood, manufacturing, meat processing, forestry, and tourism to get a good understanding of what we needed to achieve.

Officials will soon begin work engaging with key sectors and business associations to gather more information on their specific needs and to test our proposals.

I acknowledge that processing timeframes for AEWV are longer, causing immense headaches for business. As mentioned earlier, the true time it takes to process the three gateways under the AEWV visa we inherited has now been revealed, now that officers are verifying documentation and properly assessing risk.

This cannot continue - fundamental changes are required if we are to bring down processing times in a way that gets the right balance between speed and risk.

Our goal with the changes we are making is to create a system that focuses precious resource where it is needed the most - high risk employers, high risk sectors and high-risk applicants.

Meanwhile, those good employers who have been around for a long time, who have a great record with INZ, who make genuine attempts to hire kiwis and who we can trust more, should get a far lighter touch.

The goal is a smarter, more nuanced system that gets that balance right between speeding up processing, while still maintaining the integrity of our borders.

The changes we are looking to make are pragmatic, while finding that balance between attracting the skills we need to support our businesses to grow, whilst ensuring that kiwi jobseekers have first priority for job opportunities.

Because we are also a Government with a target to reduce job seeker numbers by 50,000 in five years. We owe it to everyone, but especially our young people who are not in employment, education or training, to ensure there are opportunities for them. We know if they go on a benefit before the age of 25 they are on it for an average of 19 years.

Minister Upston is doing a fantastic job of getting the settings right in her Social Development portfolio to get these young people in to work and my job is to support her. Because these are our kids in our communities and its all of our responsibility to support them.

AEWV: MSD

I know many employers are already doing great things to support New Zealanders, but there are also a significant number of employers who predetermine they want a migrant for a role and see the requirement to advertise or engage with MSD as a compliance exercise.

As an example, since April, MSD has listed over 3,000 roles via AEWV associated listings. Of those just over 50 have resulted in a New Zealander being employed. This is less than 2%.

In comparison, where employers are not contemplating a migrant worker, MSD has placement success rates of 60%.

That is a challenge for all of us. I can appreciate why some employers prefer migrants for a range of reasons. But New Zealand's future success relies on supporting New Zealanders into work, not leaving tens of thousands of people unemployed while bringing in tens of thousands of migrants on temporary work visas.

I don't apologise that in those situations there will be pushback from Immigration New Zealand because it is not reasonable to me that someone can have 50 applications from New Zealanders for a lower skilled job and say that not a single person is suitable.

SKILLED MIGRANTS

Once the AEWV review is complete, work will begin to ensure our skilled residence settings, including the Green List and Skilled Migrant Category, are appropriately targeted to address skills gaps.

I do not consider the current Skilled Migrant Category residence settings to be fit for purpose. Right now the only other main path to residence, unless you are on the green list, is via SMC and you have to either have a degree, be in a registered occupation or earn 1.5x median wage.

There a whole category missing of skilled workers, predominantly in the trades, who may have many years of experience, are well qualified and can help train up kiwi workers but who have no pathway to residence. I know for many employers, it is a source of deep frustration that they cannot retain their skilled workers in trades or manufacturing because they do not have a pathway to residence.

This needs to change and we will turn our minds early next year to what this will look like. But I say to all those skilled tradies with no pathway to residence, we want you to stay.

If we are to grow our exports, build infrastructure and rebuild the economy we need to ensure we can attract and retain the skilled people we need, and SMC changes will be a vital part of this.

RSE & SPV

To support our economic recovery, double our exports, support and grow the primary sector and further enhance our relationship with our Pacific neighbours we have made some urgent changes to RSE that were announced yesterday. These were made after substantive consultation with the sector, in particular with growers and their reflections on the impact of the setting changes made post-COVID and the unintended market consequences. I wanted to strike the balance by reducing costs and compliance for employers, and improving flexibility for RSE workers.

I also want to share that as of today, the Government is progressing with a time-limited pathway for essential seasonal workers. To provide support to employers with upcoming seasonal peaks, we have created a new pathway under the Specific Purpose Work Visa.

This pathway will continue to have some key requirements to support the integrity of our immigration system and provide New Zealanders with the first opportunity for roles. This includes requiring the role be advertised, and pay at least $29.66 an hour and is for at least 30 hours a week. Reflecting seasonality, the role must not exceed 9 months in duration.

I will be considering the need for a more permanent, long-term pathway for seasonal workers as part of the ongoing AEWV review, and we will undertake further consultation on this shortly.

These are just a few parts of the significant work programme we have for immigration. There is so much more I want to get after and I will, however it will take time with the limited resource available in MBIE.

CLOSING

My focus this term is to deliver a smart immigration system that:

• targets New Zealand's key skill gaps and prioritises higher skilled migrants - ensuring we are well-positioned to rebuild the economy,
• attracts top talent and facilitates foreign investment into New Zealand,
• gets the basics right, delivering better public services by ensuring sustainable and efficient visa processing while effectively managing risk to the border's integrity, and
• continues to advance our international priorities, particularly in the Pacific.

This will restore balance to the immigration system: targeting New Zealand's key skill gaps, prioritising higher skilled migrants, setting clear standards for access to lower skilled labour, recovering the costs of the immigration system from those who benefit from it, and using immigration settings strategically for international trade policy.

I am committed to reducing opportunities for migrant exploitation, supporting additional foreign investment for New Zealand, and fit for purpose settings across work, study, and visitor visas.

I want smart, flexible responsive nuanced solutions so there is certainty in a stable and predictable immigration system.

I want a system that creates opportunities for people to come here and make a meaningful contribution but also a system that protects New Zealanders rights to work and thrive. These New Zealanders are in our communities, in our schools, and for our country to flourish we need them to be in work and for those who need it, have the support they need to enter and sustain employment.

In November, MBIE will be undertaking targeted consultation with stakeholders on some of the details of potential changes to the AEWV to better support my priorities for the immigration system. I strongly encourage you to engage with this through the EMA to provide your feedback.

Thank you for your time today, I look forward to your questions.

No reira, tena koutou, tena koutou, tena koutou katoa.