15/05/2026
Federal Budget 2026-2027
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The Federal Budget 2026-2027 was hand downed on Tuesday 12 May 2026, introducing some key updates to the Australia's migration system.
In the perspective of Australian migration, the Government’s main plan is to revamp the permanent skilled migration point-test program to target better education, higher skilled, and younger migrants to address skills shortages.
With the information we have so far, below are the key announcements:
1) Australia’s permanent Migration Program remains at 185,000 places with the 70% skilled / 30% family split, with a strong continued focus on onshore applicants. Around 70% of places (129,590) will be allocated to people already living in Australia, while offshore places will prioritise highly skilled migrants to meet long term workforce needs. From the new budget, an advantage is given to onshore skilled applicants. Out of the total places, 129,590 are reserved for applicants already living and working in Australia. If you are currently on a temporary visa such as a 482, 485, or 408 visa, your pathway to Permanent Residency has never looked more promising.
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2) For offshore skilled applicants, there are 55,110 places remain, and these spots are strictly earmarked for high-skilled migrants in sectors facing chronic, long-term shortages, such as healthcare, secondary education, and specialised infrastructure engineering.
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3) It also indicates a shift towards prioritizing onshore visa applicants and reforms that target highly skilled and qualified migrants in the medium to long term. It reinforces that skilled migration and applicants already in Australia will be a key focus, especially for occupations and industries with long-term demand, that is implied from the streamlined recognition of overseas qualifications for trades workers.
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4) Net Overseas Migration: The budget forecasts net overseas migration of 295,000 in 2025-26 and 245,000 in 2026-27, falling to 225,000 by 2027-28 and remaining around that level through to 2029-30. Net overseas migration has declined by around 45% from its peak in 2022-23. The Budget notes that net overseas migration is moderately higher than previously expected in 2025-26 and 2026-27 because migrants on temporary visas are departing Australia at lower rates than in the past, and that arrivals of New Zealand citizens remain strong.
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5) Points Test Reform: The Government has also flagged upcoming changes to the points test that is used as a tool for subclass 189, 190 and 491 visas. The points test is used to score and rank skilled visa participants on factors such as age, English ability, work experience, and qualifications to determine who receives an invitation to apply for a Skilled Independent Visa.
Key reforms in the New Points Test:
• Age: Expect higher points for applicants in the 21–29 age bracket.
• Education over Experience: While work experience remains vital, the new system places a higher premium on Australian qualifications and higher education levels (Masters and PhDs).
• High-Demand Productivity Skills: Not all jobs are equal under the new reform. Skills that drive "sovereign capability" and "green energy transitions" are expected to receive weighted points.
• English Language Proficiency: "Competent" English is no longer enough to be competitive. The new system heavily rewards "Superior" English speakers, viewing language as the primary driver of successful economic integration.
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6) Other measures mentioned in the budget include:
• Reform of the Working Holiday Maker program, including greater use of ballots to manage demand. To better control numbers, reduce barriers to work, provide a fairer allocation of WHM visas, and support Australia’s national interests.
• Funding to address misuse of the protection visa system, including early legal advice to reduce unmeritorious claims
• Focus on visa integrity: $167.4 million in funding over four years will be committed to “strengthen the integrity of the migration system.” This includes $19.8 million over four years for “enhanced scrutiny of onshore and offshore student visa applications, ensuring the integrity of the international student visa system.”
• Assessing the requirements for establishing a Skills Migration Commissioner.
• Improving the efficiency of recognising VET qualifications.
• Ongoing support for migrant workers, victims of trafficking, and future reforms to the Adult Migrant English Program
• The Australian Border Force will receive supplementary funding of $270 million in 2026–27 to assist in combatting the influences of antisemitism, violent extremism and hate in Australian communities, and additional training to immigration and visa officers in relation to antisemitism and hate related behaviour. Increased resources for border enforcement, national security and character testing, including new visa refusal and cancellation powers linked to extremism and hate related conduct
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(Source: Federal Budget 2026-2027)