SYDNEY – Australia has abandoned its controversial “golden visas” programme, which allowed wealthy investors to gain residency, as it shifts focus towards attracting more skilled, talented and entrepreneurial migrants.

The golden visas – offered to those willing to invest at least A$5 million (S$4.4 million) in Australia – were part of a set of visas targeting the wealthy, especially from China.

Those applying for golden visas – sometimes referred to as a “golden ticket” or “buy-a-visa” – did not need to speak English and could be of any age, unlike most other visa types.

The visas allowed applicants and their family members to live in Australia for up to five years and to potentially apply for residency.

But there have been growing calls to scrap the programme over concerns that wealthy investors are not as beneficial to the economy in the long term as skilled migrants, as well as concerns about the risk that the scheme allows applicants to use and transfer corrupt or laundered funds.

Following the election of the Labor government in May 2022, Home Affairs Minister Clare O’Neil, who oversees the scheme, had said she believed the visas were a way of “buying your way into the country”.

She confirmed on Jan 22 that the visas were being scrapped, saying in a statement: “It has been obvious for years that this visa is not delivering what our country and economy need from a migration system.”

Associate Professor Anna Boucher from the University of Sydney, an expert on Australia’s migration policy, told The Straits Times that the decision to scrap the visas was not an “attack on rich migrants” but an attempt to focus on the long-term benefits of migration.

While investors might deliver a short-term boost to the economy, she said, skilled migrants tend to be younger, well-educated and deliver longer-term benefits, such as reduced dependence on welfare or the medical system.

Of course, she noted, skilled migrants also help to address workforce and skills shortages.

“Golden ticket visas deliver a short-term investment, but what is the long-term benefit to the economy?” she added. “The government is starting to think about the contribution of migrants with a more long-term perspective.”

Between 2012, when the scheme began, and 2020, 2,349 golden visas were granted, with about 85 per cent going to applicants from China.

The remainder of the visa recipients came primarily from Hong Kong, Malaysia, South Africa and Vietnam.

Since 2012, the visas have brought in about A$12 billion.

But analysis by the Grattan Institute, a policy think-tank, found that those on golden visas end up costing taxpayers about A$120,000 each over their lifetime because their demand on public services outweighs their payments in taxes.

In contrast, the average skilled worker delivers a net benefit of A$198,000 during their lifetime.

The institute’s economic policy programme director, Mr Brendan Coates, said he supported the decision to scrap golden visas, adding that this would enable the government to bring in more skilled migrants.

“Compared to every other part of our skilled migration programme, this programme attracts older, less-skilled migrants who tend to contribute relatively little to Australia,” he told SBS News on Jan 23.

The golden visas have also raised concerns that they may be used by corrupt officials or criminals to gain residency in Australia and transfer funds there. 

Prominent investor and international anti-corruption campaigner Bill Browder has been a fierce critic of Australia’s scheme and welcomed the decision to scrap it.

The golden visas are being abandoned as part of a broader closure of a range of visas for investors and business owners, including a visa for those who can prove they run successful businesses and have at least A$1.25 million in assets. 

According to the Investment Migration Insider website, most recipients of these investor and business visas – about 5,000 a year – came from China. From 2010 to 2021, about 622 Singaporeans received a business or investor visa.

The government is planning to replace these scrapped visas with a new type of visa focused more squarely on those bringing innovation and talent into the country, including entrepreneurs, major investors and researchers.

A government review, released on Dec 11, 2023, said that offering residency is “an important drawcard to attract these migrants as we compete with other nations in the global race for talent”.

Prof Boucher backed the plans to focus on innovation and talent, saying Australia should not merely try to bring in skilled migrants but should seek to attract talented entrepreneurs who have the potential to succeed through “risk taking, leadership and money to invest”.

“A skilled migrant can be really skilled but it is not the same as an entrepreneur,” she added. “We do need both. The challenge is knowing how to pick them.”