Major Changes to the Skilled Migrant and Parent categories

Significant changes were announced by the New Zealand Government earlier this month around the New Zealand Residence Programme (NZRP). Most noteworthy at the time of writing this article are the changes to the Skilled Migrant Category (SMC) and Parent Category resident visa policies. These changes will lead to a reduced number of residence approvals, with effective closure of the Parent Category (for some time), and a shift in focus for a preference for skilled migrants to be highly educated/experienced as well as holding an offer of skilled employment before being eligible for residency.

The SMC category the points threshold for automatic selection for the Expression of Interest Pool has been increased from 140 to 160 points (regardless of whether an applicant has a job offer), and the Parent (Family) Category is now temporarily closed. These policy changes signal a major shift in long term residency focus.

The tweaks to the SMC change the focus to attract very highly skilled and qualified applicants offshore, and medium to highly skilled level migrants onshore who hold offers of employment. Many applicants who would have been able to qualify without an offer of employment offshore will no longer be able to meet the new points threshold without an offer of employment (even if they are tertiary or trade qualified). Similarly, many applicants in New Zealand in lower “skilled” occupations who would have qualified easily will now find it much harder to qualify, especially where they lack a high level degree level qualification (e.g. tradesmen; and managers/chefs employed in hospitality) even if they hold a skilled offer of employment.

In addition, changes to the English language test will mean that many international students who have not gained degree level qualifications in New Zealand will find it much harder to meet the mandatory English language test, even if they are able to meet the new points threshold.

Under the Family (Parent) Category applications are now temporarily closed to new applicants. Immigration New Zealand will not make selections from the Parent Category Pool until further notice, as it will take until after the end of the 2017/18 financial year to clear all the applications already in the system. It is presumed a new policy will come out of a further review (which must be well underway), but it is quite clear that a signal has been sent that it is going to become progressively harder for parents of skilled migrants to be able to qualify for residency based on family sponsorship in the future.

The recent changes will have an impact for many potential applicants, and essentially shift the playing field. More migrants from offshore are going to need to assess potential eligibility, and then plan to travel to New Zealand to secure an offer of employment to allow them to qualify, and at the same time, weighing up the prospect that is may be difficult to secure residency for their parents who may wish to retire in New Zealand with them.

As a final point, and what is a warning from us, is the fact that we are expecting changes to temporary work visa policy in the face of this change in direction. A negative by-product of a shift like this will be more people in New Zealand on temporary work visas for a longer time because they cannot qualify for residency, because the demand for that labour will not subside. That would be a significant problem to manage in the long-term. Farming already has that issue, where Herd Managers  cannot convert to residency easily, despite remaining for years in New Zealand on work visas.  This means their children, who have been living in New Zealand for many years, are not able to enter subsidised tertiary education – it’s a no-win situation.

We foresee a similar shift in work visa policy that will make it harder to qualify for work visas in lower skilled occupations, such as hospitality, and/or pathway work visas such as those issued to foreign students upon graduating, where there is no logical pathway for residency under the SMC and there is risk that these people are taking opportunities away from young New Zealanders. We also predict a counter change in some residence policy, with the creation of a new category to allow long-term work visa holders in certain key economic areas, or remuneration bands, to qualify for residency under certain limited conditions, such as farming, but not hospitality/retail. Policies moving in this direction will be implemented progressively with a long-term view to reduce the reliance on offshore labour in lower skilled areas where there are New Zealanders who could be trained for those opportunities, with residency policy adopting  a more strategic (narrow) focus, rather than a general approach that has been in place up until recently.

Watch this space, there is more to come.

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