Denham Sadler
March 19, 2018

New skills visa is not enough

Skills

New skills visa is not enough

Alan Tudge: World's slowest walk-back from the disastrous 457 visa changes a year ago

Nearly a year after the shock scrapping of the 457 visa program, the federal government is set to a trial a new visa scheme for tech companies to attract talent from around the world.

The new Global Talent Scheme, announced by government via a behind-the-paywall article given to the Australian Financial Review, includes separate options for established businesses and for startups to bring in skilled workers into Australia.

A pilot scheme will be tested for 12 months from the start of the new financial year.

The federal Opposition has slammed the announcement, saying it is a replica of a policy announced by Labor in May last year, and that the government cannot be trusted on skilled immigration issues.

StartupAus chief executive Alex McCauley said the pilot scheme was a step in the right direction for addressing the tech industry’s skills gap.

“It’s not set in stone yet but it’s encouraging to see startups get access to the priority visa stream,” Mr McCauley told InnovationAus.com.

“This is something we’ve had on the top of our agenda for a long time now so the movement is really encouraging. This is the single biggest thing holding startups back, and this is a big step forward.”

Under the new scheme, the established business stream is open to publicly-listed companies or those with a turnover of at least $4 million annually, for positions with a salary of at least $180,000 annually.

The startup stream will be open to early-stage companies in the STEM space, with companies requiring the endorsement of the newly created “startup authority” to be eligible.

Both streams come with strict labour market testing and en emphasis on prioritising Australian workers. They will both be open for permanent residency pathways after three years, if the pilot is extended.

The government is yet to reveal an occupation list for the new scheme, or if there would be a cap on the number of visas on offer across the system.

It said it would consult with industry before the pilot kicks off in the new financial year.

Citizenship and Multicultural Affairs Minister Alan Tudge said the new scheme will help to address the skills gap in many industries in Australia.

“We want to ensure that Australian businesses can access the best talent in the world, because this will underpin business growth, skills transfer and job creation," Mr Tudge said.

"At all stages, Australians are prioritised for the jobs, but where the skills and experience are not available here, we want to be able to attract talent from overseas."

The tech and startup sectors have been grappling with uncertainty and a restricted occupation list following the removal of the 457 visa.

The policy drift had been sharply criticised by numerous high-profile members of the community.

The scheme first proposed by government to stakeholders last month only included the established business stream, but after lobbying from StartupAus, the startup strand was introduced without the established track record required of older businesses.

For the startup stream, the government will hand this responsibility for deciding whether a company qualifies or not to a “startup authority”, which will be created among community representatives in the coming month.

“It’s the government saying that they want to work with industry on this and they don’t necessarily know what a startup looks like sitting in Canberra, and don’t necessarily have the best expertise for making that assessment,” Mr McCauley said.

“It’s important for the industry to take on board the responsibility for making this thing work.

It’s currently unclear how this authority would operate and what its financial implications are.

The startup stream’s minimum salary threshold is also yet to be determined, but would include equity and a cash component of at least $53,900.

“This is the first piece of visa legislation in this country that takes into account equity when thinking about salary. Skilled visa programs usually require a minimum salary and we’ve pushed again and again for equity to be considered there,” Mr McCauley said.

The financial threshold for the startup stream has not been determined yet, and may be based on working capital or capital raised by the company.

Established businesses with more than $4 million in revenue can access 20 visas per year, while startups can access up to five.

The new visa scheme would also require applicants to demonstrate that they would be able to pass on skills to Australian workers, Innovation and Jobs Minister Michaelia Cash said.

“Industry figures say globally mobile, highly skilled and experienced staff can act as ‘job multipliers’ in Australian businesses, helping them to hire more local staff and fill critical areas of need,” Senator Cash said.

The federal Opposition announced a similar scheme for tech companies in the wake of the scrapping of the 457 visa early last year.

Labor’s SMART visa would focus on bringing in skilled workers in science, medicine, academia, research and technology, ensuring companies are able to “bring the best and brightest here”.

The SMART visa would have a four-year term with salary safeguards and market testing for each role.

In a statement, the Opposition said on Monday that the government is now following in Labor’s footsteps with the new visa scheme.

“Labor’s new SMART visa would mean the best and brightest talent from around the world would have the opportunity to develop their ideas in Australia – with a pathway to permanent residency for educators, innovators and researchers of a global standing.

“Now, over 10 months later, Turnbull and his conservatives are playing catch up and following Labor’s lead,” the Opposition said.

“Turnbull’s scheme is only a pilot and, by the government’s own admission, they haven’t finalised the details of the pilot including the number of visas set to be made available or which specific jobs they’ll be available for.”

“The Turnbull government’s track record is in botching changes to temporary skilled migration and proving they can’t be trusted with Australian jobs.”

Mr McCauley said it’s positive that there is now bipartisan support to improve visa schemes for tech talents looking to access global talent.

“I’ve long been a supporter of Labor’s SMART visa policy. I think it makes heaps of sense that both sides of politics are looking to help Australian businesses access the best talent in the world - that’s the single biggest thing that most industries need in order to be successful,” Mr McCauley said.

“Both parties are realising that this kind of visa is a net job creator for Australians. If you hire someone really skilled it helps you to grow your business, and growth comes in the forms of Australians being hired for new roles. There’s no downside really.”

The startup sector has been lobbying the federal government for nearly a year for improved access to global talent, following the changes to the 457 scheme.

The new announcement is a step in the right direction to addressing this issue, BlueChilli founder Sebastien Eckersley-Maslin said.

“The proposed scheme is a positive step to help startups recruit the talent they need where it’s not available locally,” Mr Eckersley-Maslin told InnovationAus.com.

“The startup stream is well within the reach of many companies, and I hope the government will leverage the existing early-stage innovation company definition for a startup so there’s only one hoop for funded startups to go through,” he said.

But angel investor and M8 Ventures founder Alan Jones said the new scheme was still too restrictive for startups and was only a marginally improvement.

“These guidelines move Australia from ‘literally impossible to hire someone from overseas’ to ‘theoretically possible’. As with almost all government policy relating to the tech industry, we should file this under ‘good start’ not ‘problem solved’,” Mr Jones told InnovationAus.com.

“The overall approach suggests that the guidelines are largely about minimising the impact of the changes this scheme might have, rather than maximising them,” he said.

“The focus seems to be more on making sure no adverse outcomes arise and no local jobs are lost. I would be much more liberal and open about the criteria, the limits on the number of people a company can hire this way and the way these roles are funded.”

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