Federal Budget 2026-27: What It Means for Australian Immigration 

Federal Budget 2026-27

The Australian Government has released the 2026-27 Federal Budget, and migration remains a key part of the Government’s broader productivity, workforce and population strategy. For visa applicants, employers and international graduates, the message is clear: Australia is not closing the door to skilled migration, but the system is becoming more targeted, more competitive and more focused on applicants who can meet Australia’s long-term workforce needs. 

Permanent Migration Program remains at 185,000 places 

The Government has confirmed that the 2026-27 permanent Migration Program planning level will remain at 185,000 places. Of these, 132,240 places, or more than 70 per cent, will be allocated to the Skill stream.  A major feature of the Budget is the continued focus on people already in Australia. Across the Skill and Family streams, the Government has allocated 129,590 places to onshore migrants, with 55,110 offshore places mainly directed towards highly skilled migrants who can help address Australia’s long-term skill needs.  For many applicants already in Australia on temporary visas, this may present an important opportunity. However, it also means that offshore applicants may face stronger competition, especially where they are not in high-demand occupations or do not have a strong skills profile. 

Net overseas migration forecast to keep falling 

The Budget forecasts net overseas migration at 245,000 in 2026-27, falling to 225,000 in 2027-28, and remaining at 225,000 in 2028-29 and 2029-30.  Treasury notes that net overseas migration has already declined by around 45 per cent from its 2022-23 peak, although it is now expected to be higher than previously forecast in 2025-26 and 2026-27 because temporary visa holders are leaving Australia at lower rates and New Zealand citizen arrivals remain strong.

Points test reform is coming 

The Budget confirms that the Government will reform the permanent migration points test to better identify migrants who support productivity and long-term prosperity. The Budget states that almost two-thirds of permanent skilled migrants are currently selected through points-tested visas, and that the test will be optimised to select better educated, higher-skilled and younger migrants overall.  This follows the Department of Home Affairs’ earlier points-test review process, which identified the current points categories: age, English language ability, employment experience, educational qualifications, Australian study, and partner English ability. The points test applies to visas such as the subclass 189, 190 and 491 visas.  At this stage, the detailed rules have not been released. Applicants relying on general skilled migration should avoid assuming that the current points system will remain unchanged.

Faster skills assessments for trades and onshore visa holders 

The Budget includes $85.2 million over four years to improve recognition of migrant skills through faster and more flexible skills assessments. This includes $75.1 million for a new Trades Recognition Australia skills assessment system, including pilot assessment-to-licensing pathways for priority trades such as electricians and plumbers.  There is also $5.6 million over three years for TRA to deliver a new skills assessment program for onshore visa holders, recognising existing qualifications and practical trade experience. A further $4.5 million will strengthen oversight of assessing authorities, including a requirement for annual performance reporting from 2027.  This is particularly relevant for tradespeople, construction employers, and applicants already in Australia whose overseas qualifications or trade experience have not yet been fully recognised. 

Working Holiday Maker program to be reformed 

The Government has also announced reforms to the Working Holiday Maker program. The Budget states that the WHM program will be changed to better control numbers, reduce barriers to work, provide a fairer allocation of visas and support Australia’s national interests. This includes expanding the use of ballots to manage the program better.  Further details are still expected. This may affect future applicants planning to use a working holiday visa as an entry point into Australia. 

Stronger migration integrity and student visa scrutiny 

The Budget provides $167.4 million over four years to strengthen the integrity of Australia’s migration system. This includes funding to address misuse of the protection visa system, strengthen migration system capability, continue migrant worker education activities, and provide $19.8 million over four years for enhanced scrutiny of onshore and offshore student visa applications.  This means student visa applicants should expect continued focus on genuine study intentions, financial capacity, course progression, risk profiles and overall credibility. 

Temporary Graduate visa application charge increase 

The Budget confirms that the Temporary Graduate visa application charge was increased by 100 per cent from 1 March 2026, excluding eligible Pacific Island and Timor-Leste applicants. The measure is estimated to increase receipts by $1.2 billion over five years.  Graduates planning their next visa step should factor in both higher costs and stricter post-study migration settings. 

Adult Migrant English Program changes 

The Government will also change the Adult Migrant English Program. The Budget states that eligibility will be adjusted to target clients most in need of formal English tuition, with a new program model from 1 January 2029 to provide flexible tuition and student supports aimed at improving English language, employment and social cohesion outcomes.  

Passenger Movement Charge increase 

From 1 January 2027, the Passenger Movement Charge will increase by $10, from $70 to $80 per passenger. This charge applies to passengers departing Australia by air or sea, unless an exemption applies.  This is not a visa application charge, but it will slightly increase the cost of departing Australia. 

What this means for visa applicants and employers 

For skilled visa applicants, the Budget reinforces the importance of being strategic. A positive skills assessment, strong English, relevant work experience and a clear occupation strategy will become even more important if points-test reforms favour younger, highly skilled and better qualified applicants. For employers, the Budget confirms that skilled migration remains central to Australia’s workforce planning. However, offshore recruitment may become more competitive, and employers should expect continued scrutiny around genuine position, salary, workforce need, compliance and sponsorship obligations. For students and graduates, the Budget points to a more selective system. Student visa scrutiny will remain high, graduate visa costs have increased, and applicants should plan early rather than waiting until their visa is close to expiry. 

Better Life Migration’s view on the Federal Budget

The 2026-27 Federal Budget does not reduce the permanent Migration Program, but it does sharpen the focus of the system. The strongest opportunities are likely to be for applicants who are already in Australia, have occupations aligned with workforce needs, can demonstrate strong skills and qualifications, and are able to present a well-prepared, decision-ready application. At Better Life Migration, we assist employers, skilled visa applicants, students, graduates and families to understand their visa options and prepare strong applications based on current migration law and policy.

If you are unsure how these changes may affect your visa pathway, speak to a Registered Migration Agent before taking the next step.

Better Life Migration
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