Net Overseas Migration (NOM) forecasts are a component of the assumptions used in the Budget. The forecasts in the Table below are produced by the Centre for Population within the Treasury.
NOM is the difference between migrant arrivals in Australia and migrant departures from Australia. Migrant arrivals in Australia are counted in NOM if they are in Australia for a total of 12 months or more during a 16-month period. Migrant arrivals include Australian citizens or permanent residents returning to Australia after a period residing overseas, permanent visa holders, and temporary visa holders who reside in Australia for at least 12 out of 16 months. Migrant departures include visa holders returning to their home countries after a period of residence in Australia, and Australian citizens leaving Australia to reside overseas. NOM affects population growth, which is in turn one of the drivers of economic growth. Population growth is expected to slow from 1.2 per cent in 2019–20 to 0.2 per cent in 2020–21 and 0.4 per cent in 2021–22—the lowest growth in over a hundred years (Budget Strategy and Outlook: Budget Paper No. 1: 2020–21, p. 2-13).
Budget Paper no. 1 sets out assumptions on the return of international travel, beginning with small pilot programs of international student arrivals from the end of 2020 and a gradual resumption of permanent migration in the second half of 2021 (p. 2-6). It also notes possible alternative scenarios, including ‘downside scenarios’ where the opening of international borders is delayed due to further outbreaks of COVID-19, and ‘upside scenarios’ where an early vaccine and successful pilots of international student arrivals could lead to more rapid recovery (p. 2-15).
Actual NOM is calculated by the Australian Bureau of Statistics (ABS). The latest annual figures are for 2018–19. The latest quarterly estimates are as at 31 March 2020. In the twelve months to that date, NOM was 220,500, down by 12 per cent on the previous year but still contributing 61.8 per cent of Australia’s annual population growth. The decline was due to an increase in departures, in part because of the impacts of COVID-19, but this reflects only the early stages of international travel restrictions. Australia closed its borders on 20 March 2020, tightly restricting both arrivals and departures. The impact on international travel is presented in the ABS Overseas Arrivals and Departures dataset.
ABS and Home Affairs reports show that in recent years, NOM has been driven mainly by temporary visa holders—they formed 64.3 per cent of overseas migrant arrivals in 2018–19. (Many temporary visa holders leave Australia in future years—52.8 per cent of migrant departures in 2018–19 were temporary visa holders.) The largest category of temporary visa holders making up NOM is international students: 173,000 in 2018–19, forming 32.2 per cent of all migrant arrivals.
Permanent visa holders, that is, those arriving from overseas counted within the Migration Program, made up only 15.4 per cent of NOM in 2018–19. Permanent visas may also be granted to people already in Australia on temporary visas. In 2020–21, around two thirds of permanent visas are forecast to go to people already in Australia, with more places allocated in particular to partner visas drawn from onshore (discussed further below). The resumption of arrivals of international students will therefore be a key factor in whether the NOM projection is realised for 2020–21 and whether NOM will recover in the forward estimates.
