Interview with Fran Kelly, RN Breakfast

Fran Kelly: The Prime Minister Scott Morrison is flagging a permanent cut to the nation’s immigration rate. The PM says he’s hearing the message loud and clear that Australians are fed up with clogged roads, full buses and trains, and overcrowded schools and hospitals.

Without actually committing it to a new annual cap, the Prime Minister has hinted the intake could be reduced by around 30,000 people a year to take the pressure off our biggest cities; and he’s inviting input from the states in helping to set the new number.
Alan Tudge is the Minister for Cities and Population, or as Scott Morrison puts it, the Minister for congestion busting. Minister, welcome back to Breakfast.

Alan Tudge: G’day, Fran.

Fran Kelly: The Prime Minister says: enough, enough, enough and cities like Sydney and Melbourne have become victims of their own success. If that’s the case, why not just cut the immigration number and be done with it because the Commonwealth controls the levers?

Alan Tudge: That’s true. So we control the main population growth lever…

Fran Kelly: [Talks over] Yeah.

Alan Tudge: …which of course is immigration. It accounts for 60 per cent of our population growth, but the states and territories are responsible for building the infrastructure and the housing and the schools and the hospitals to cater for that population growth.

So, in essence, what we are saying is we’d much rather have a bottom-up process in relation to population growth, assess what the carrying capacity is of the major cities and the regions; and in large part, deliver the population to meet that carrying capacity.

Fran Kelly: Okay. There was already a revision of the cap this year from 190 down to about to 162 I think it was. The PM suggested last night that that’s probably about right; that’s probably about where it will end up. Is that where you agree it should be?

Alan Tudge: Well, we’ll have to go through the process. So the process now will be that the Prime Minister will discuss this with each of the states and territories.

They will tell us what their plans are; what the population should be in their particular state and territories; what infrastructure they have to cater for that; and then the population number, in essence, will be an aggregation of those figures.

So, it will likely mean a reduction in the migration intake but we’ll go through the process to determine that.

Fran Kelly: But the PM’s already got a feel for it. He said last night it wouldn’t surprise me if any process we went through will arrive in that sort of territory – that sort of territory of 30,000 below where it’s been.

Alan Tudge: Well, that’s where we have been in the last couple of years, Fran. So the cap is 190,000. Last year, we came in at 162,000. When we go to the states and territories and ask them: what do you want the population numbers to be in your cities?

What infrastructure do you have to meet that? Do you have the carrying capacity for it? And when you add up these numbers, we expect it to come in around that number, but we’ll wait and see.

Fran Kelly: The truth is many of our cities have nowhere near the infrastructure to carry the population they have. So what if the states say: well, we want this number, but they don’t have the infrastructure plan? Could the cap [indistinct] way down?

Alan Tudge: [Talks over] Well, we want to have a look at that. We want to have a look at what their plans are. So each of the states and territories should have quite a clear view as to what their carrying capacity is; what their infrastructure pipeline looks like; and therefore, how many people they can accommodate without overburdening that city.

Now, we're going to have different results, by the way Fran, in different parts of the country.

I fully expect in South Australia, in the Northern Territory, in Western Australia, in Tasmania that they'll be asking for more people because having spoken with those governments, they want to grow their populations, whereas in Victoria and New South Wales, we're particularly feeling the pressure in Melbourne and Sydney because most of the migration goes into those two big capitals.

Fran Kelly: Infrastructure cost a lot of money, of course; immigration brings in money; and the PM actually is not committing to anything yet, of course. This was just the speech last night. The Government has been split in this year over the immigration level.

Back in February when Tony Abbott proposed the number of immigrants to be cut by 80,000, Scott Morrison was Treasurer at the time and he knocked the idea on the head by warning that such a resolution would cost the budget for $4 to $5 billion over four years.

How much would an annual cut of 30,000 hit the budget?

Alan Tudge: Well, we already have that figure last year, so those figures were already locked in effectively into the budget figures last year. Now, of course, there is a balance here because migration does …

Fran Kelly: [Interrupts] So you’re saying it wouldn't be a knock to the budget in the way 80,000 would have been a knock to $4 or $5 billion over four years.

Alan Tudge: Well, absolutely. Of course, the migration number has an impact on the budget figures but this is an overall balance. Now, migration brings growth; it brings skills; it brings younger people into the population to better cater for the ageing population. So it's very important that we do maintain a strong migration intake, particularly a skilled migration intake, but that's got to be balanced out in terms of the population pressures which particularly Melbourne and Sydney are feeling.

Now, the listeners from Melbourne and Sydney will fully understand how congested those roads are now; the pressure which has been put on some of the services, the schools, on property prices and the like. Other parts of the country, though, will be saying: actually, we want to grow faster and we want to tailor our population approach, if you like, in our migration approach, to as much as possible deal with those different aspirations of the cities.

Fran Kelly: [Talks over] But just let me get this clear, though, because there’s sort of two messages. At the same time, the PM seems to be promising a smaller immigration intake of around 30,000. You seem to think that's where it would fall. He acknowledged last night, again, that population growth along with productivity will become even more important for sustaining strong growth in national living standards as the ageing of the population weighs on workforce participation.

So, in other words, we need more migrants to keep up the economy and to be able to support the population change and the ageing population. So we need more migrants but a cut around 30 should still keep the balance right. Is that what you’re saying? Is that what you think?

Alan Tudge: Well, in essence, that's effectively what we're saying although we haven't specified the precise number because that will come out through the process. We expect it may end up being in maybe a reduction of 30,000 or so but let's go through that process.
But it is a balance, Fran. We still need to have migrants coming into the country for those reasons that you're talking about and it does assist all of us in terms of living standards, a growing economy, greater opportunities, dealing with the ageing of population but that does have to be balanced down against the liveability, particularly of our big cities which receive the vast bulk of the migration intake.

Fran Kelly: So we've been talking about this for much of this year but still there's no population plan. When will we get some firm numbers or is this the government talking about population immigration because you know they’re hot button issues and we’re heading to an election?

Alan Tudge: [Talks over] No. Well, no because we've got a COAG Meeting in mid-December so the Prime Minister has …

Fran Kelly: [Talks over] What will come from that?

Alan Tudge: So the Prime Minister has foreshadowed that he’ll be writing to the premiers and chief ministers shortly and he's putting this on the agenda for COAG to discuss it at that particular stage; and we'll work through the process that particular way.
Now, as I said, I expect, for example, the chief minister- the Premier of South Australia will say: we want to grow South Australia. Can you support our aspirations? Where it’s almost certainly that Gladys Berejiklian here in New South Wales, will be saying: actually, we need to slow down the growth slightly here in the New South Wales.

Fran Kelly: [Talks over] And when will you reveal the plans of how you might manage that – assign some migrants, new arrivals to different states?

Alan Tudge: Yeah. So we're working through those processes now. Now, we’ve already …

Fran Kelly: [Talks over] I think this is my third interview where I’ve talked to you about this. When are you going to have some firm plans?

Alan Tudge: [Talks over] Yeah. But we’ve always said in terms of the broader population plan, we’d be looking at early next year in terms of revealing fully that.

But you can start to see a flavour of where we're going now – a much more bottoms-up approach to the migration intake tailored to the particular needs of the cities. That might end up being with an overall migration intake nationally but we want to support those places that want to grow while easing the pressure off the big cities.

Fran Kelly: The annual migrant intake pales in comparison to the number of people on temporary visas. I think there's around 600,000 international students studying in Australia, for instance, all of them need to be housed, they need to use the roads, the public transport, the buses - if you're serious about taking the pressure off the big cities you're going to have to look at those numbers as well.

Alan Tudge: Well Prime Minister Morrison foreshadowed this last night to say that the states and territories need to have a very close look at this, because about half of the permanent migrants were already in the country as temporary migrants before they become permanent migrants.

So if you like, we've got to look earlier in the process to sort of say well, what's going on there? And let's be very careful about this because where for example our university- international education industry is a very strong industry does very well for us.

So we want to be very careful that we don't interrupt that too much. And so that's why we're just taking it steadily. That's why we're asking the states and territories to be quite thoughtful about this, really consider the consequences of what they're putting forward and then we'll come together and aggregate that into the migration plan.

Fran Kelly: You’re listening to RN Breakfast. It’s 7:45, our guest is Alan Tudge. He’s the Minister for Cities, Urban Infrastructure and Population. There was a poll yesterday - Ipsos poll showing that 46 per cent of voters want to see the migration intake from Muslim countries lowered; 35 per cent say it should stay the same.

The Government now seeming to blame migrants for the fact that our big cities are full. Is there a danger that these two issues could become conflated? Are you worried about sort of ugliness seeping into this debate?

Alan Tudge: Listen we've been discussing this for several months now, Fran, as you know, and particularly Melbourne and Sydney which are facing these congestion challenges. Now the bottom line is that most of the population growth has been driven by migration in those two cities.

Indeed, in Sydney last year 83 per cent of the growth of Sydney was due to migration. So of course it is a factor but it's been the lack of infrastructure build in the past which has actually caused the population pressures.

Fran Kelly: [Interrupts] I’m talking about conflating it with this issue of Muslim migration which is actually a very small component of our overseas migration, isn’t it?

Alan Tudge: Yeah, yeah, it is and will always have a …

Fran Kelly: What size is it, do you know?

Alan Tudge: We’ll always have a non-discriminatory immigration policy Fran, but people when they come into the country obviously have to commit to adopting Australian values and that's all we ask for. They've got to pass security checks and they've obviously got to get through the visa hurdles to get into the country.

Fran Kelly: Where are we at on that values test you spoke to us about earlier this year? You were saying we needed one to fend off what you called segregation in our big cities and that ended up feeding the African gangs debate in your home town of Melbourne, but where we are at in terms of that values test?

Alan Tudge: So there's still work going on in relation to that, Fran. Now this is one of the issues which we do have to address and address maturely and sensibly is the social cohesion of our big cities and we want to maintain that social cohesion.

We've done so well in the past in relation to that and we want to ensure that we can continue to maintain that social cohesion. So it's part of our population policy if you like. We've got to get the growth numbers right. We've got to maintain the social cohesion and of course we have to make sure that we get the demographics right as well to be able to tailor- to be able to cater for the ageing population.

Fran Kelly: The demographics of who we bring in – you mean the age?

Alan Tudge: The demographics of who we bring in. So on average for example the migrants who come into the country, they are aged- the average age is 26 years. Now that's a great age that they come in because they are in the working age, they're contributing to the country. And if we don't maintain at least a reasonable proportion of migrants coming in, in that working age, then we’ll quickly find we do have an ageing population.

Fran Kelly: But that’s what we do have anyway, so why would we think we wouldn’t?

Alan Tudge: Well so, we will be, but our whole discussion here is about what the level of migration is going to be, post the process which we go through. And so we've got to balance these things out is my point.

Fran Kelly: Alan Tudge …

Alan Tudge: There’s good economic reasons to maintain a strong migration intake but we're balancing it out particularly with the enormous pressures which Melbourne and Sydney are under.

Fran Kelly: Alan Tudge, thank you very much for joining us.

Alan Tudge: Thanks very much Fran.

Fran Kelly: Alan Tudge is the Minister for Cities, Urban Infrastructure and Population. Your listening to RN Breakfast.