It is crucial Australia preserves its competitive temporary migration program with the inclusion of incentives for migrants to work in rural and remote communities.
Australian agriculture relies heavily on overseas workers at times like harvest as, due to its inconsistent and temporary nature, it is can be very difficult to attract and retain seasonal farm labour.
Traditionally, the bulk of our overseas workforce has entered Australia on Working Holiday visa, but increasingly the Seasonal Work Program is facilitating access to trained workers from Pacific nations.
The number of Working Holiday Makers (backpackers) has declined in recent years and it has become critical Australia preserves competitive migration programs that include incentives to work in agriculture in rural Australia to fill this gap.
The 2015 Federal Budget announced that backpackers will be taxed as nonresidents from July 2016 onwards. This tax increase to 32.5 per cent could lead to severe labour shortages at harvest time as it makes net earnings in Australia unattractive in comparison to Canada and New Zealand.
Labour shortages in agriculture could be exacerbated if backpackers lose the incentive to work in agriculture to achieve a second year extension to their visa. Positive developments are recent amendments to the Seasonal Worker Program, making it easier to employ Pacific Island and East Timorese workers by removing the minimum stay requirement. However, although there are productivity gains from seasonal workers over backpackers, high upfront costs have meant that uptake of the Seasonal Worker Program has been slow.
What the industry needs
- Maintain the current tax status of Working Holiday Makers and establish a new low skilled visa stream for agricultural work in Rural Australia for economic migrants.
- Harmonise the differing working holiday visas available to citizens of different countries to enable all backpackers to access a second year extension and remove existing caps by country.
- Establish a ‘Seasons Worker Program Administration Fund’ that manages upfront costs associated with sponsoring seasonal workers, thus lowering the financial risk to farmers.
- Raise awareness about the Seasonal Work Program among farmers, highlighting productivity gains associated with reemploying the same workers year after year.