Editor's Blog

In order to allow passage of the China free-trade agreement, the Coaltion government is considering Labor’s compromise proposals, one of which requires that that the income threshold for sc457 workers is increased from the current levels.

Labor has proposed an increase in the TSMIT under 457 scheme from a market rate of $53,900 to $57,000.

The proposal goes directly against the sc457 review committee’s recommendation that the TSMIT is frozen at $53,900 as well as DIBP figures showing that current average wages in the key industry sectors where sc457 workers are hired are well below Labor’s proposal.

If accepted, Labor’s compromise plan for passage of the China free-trade agreement would knock out more than one quarter of this year’s 457 visa program and price some regional areas out of the scheme, according to a report in The Australian.

Immigration Department figures obtained by The Australian show that, of the 13,239 visas granted under the 457 category to the end of September, 3581 fell below the proposed $57,000 threshold, equivalent to 27 per cent or over a quarter of all visas granted.

Of those, 581 or 4.4 per cent of the 457 visas granted were right on the current threshold of $53,900, notes The Australian.

Immigration Department figures show average wages in accommodation and food services in Queensland ($56,500) and Tasmania ($56,400) would not be sufficient to be able to access the 457 visa program under a $57,000 threshold. The industry in Victoria ($57,500) would just qualify. Many industries in the Northern Territory would be knocked out of the scheme, including retail trade ($56,900), agriculture, forestry and fishing ($55,800) and arts and recreation services ($56,800).

Australian Chamber of Commerce and Industry employment director Jenny Lambert told The Australian the figure Labor has put forward on the TSMIT “is very concerning and the government should reject it out of hand.”

Labor has also proposed other amendments to the Migration Act to mandate labour market testing for investment facilitation agreements that apply to projects worth more than $150 million, ending a two-year freeze and restoring indexation, and stipulating that 457 visa holders in trades either hold the relevant licence or obtain one within 60 days of arriving.

Trade Minister Andrew Robb has promised to negotiate in “good faith’’ on Labor’s proposals.