NEW ZEALAND IMMIGRATION BLOG

Letters from Southern Man

IMMagine New Zealand Immigration Blog

Posts in category: Immigration

To subscribe to our weekly blog, click here to be added to our database.

Note: If you have previously registered for the Southern Man newsletters but are no longer receiving our email notifications you may have been unsubscribed by your spam filter. Simply register your details here and we will add you back to the database right away.

Comments: We welcome debate and discussion in our blogs, whether you agree with what we say or don't. We encourage intelligent and informed discussion and invite anyone to comment. However anyone posting comments with abusive or foul language or people 'simply having a rant' we will delete them immediately.

Letters from the Southern Man

Migrating is more than just filling in forms and submitting paperwork, its a complex process that will test even the most resilient of people. 

Understanding New Zealand is paramount to your immigration survival and to give you a realistic view of the country, its people and how we see the world, read our weekly Southern Man blogs. Often humorous, sometimes challenging, but always food for thought.

When will the Skilled Migrant pass mark drop (and why)?

Posted by Iain on Feb. 10, 2017, 3:18 p.m. in Immigration

A few people have asked me recently why I believe the skilled migrant pass mark will fall from 160.

The short answer is because it needs to.

My analysis can be found in the maths of the passmark calculations and a little bit of faith that the New Zealand Government is both serious and committed to issuing 27,000 resident visas under this category, which it continues to publicly state is its target.

Historically, for New Zealand to issue 27,000 resident visas in any 12 month period, they have had to select around 700 Expressions of interest each fortnight from the ‘pool’. Each EOI accounts for a little over 2 people. So, they select 700 EOIs covering say 1450 people every two weeks, and they do it 25 times a year (they skip one pool draw around Christmas/New Year). If all those selected were approved and granted Resident Visas that would mean around 35,250 resident visas issued in any 12 month period.

Which in turn tells you that more EOIs must be selected than are needed to fill the annual quota because many get no further than selection (they over claim or misclaim points and are either declined or thrown back into the pool by INZ following their selection as a result - it happens a lot). If they are lucky they will be invited to apply for residence based on a claim that looks credible but turns out not to be. 

Of those invited to apply for residence, we know something like 40% will never be offered or granted a resident visa and will be declined. 

There are many reasons for this - applicants often cannot satisfy INZ that the evidence to back their points claim is genuine, relevant, material or verifiable - each being a reason to knock points off - and decline. Furthermore, many people who had the pass mark at selection but did not have a job offer subsequently declined the offer of a job search work visa when INZ decided not to grant them residence at the end of the process. Finally INZ often makes poor decisions and it is they and not the applicant that gets things wrong.

So many more EOIs have to be selected because of the very high (some might suggest scandalously so) rejection rate.

Since the automatic pass mark increased to 160 from 140 back in October last year, each pool draw has seen around 350/360 EOIs selected each fortnight. This is simply because there are far fewer EOIs in the pool with 160 point claims.

So, extrapolating those selection numbers out to the numbers you might expect will be approved, it all points not to 27,000 resident visas being issued, but more like 15,000. Way below target.

I have little doubt there will be those in the pool that might, whilst swimming around, be able to legitimately claim additional points (you can edit your claim whilst in the pool). This may lead to higher numbers being selected. In recent weeks there was one draw for example where around 400 EOIs were selected. So, there is evidence of people ‘upping’ their points while in the pool.

Equally however as more people try and squeeze out more points, even more will be rejected following selection because they are not eligible for those points. We are seeing more and more of this when people come to see us.

If this whole process was objective and based purely on numbers the pass mark simply has to fall at least back to 140.

My best estimate of the earliest this will be allowed to happen is the end of April but I expect it will be later.

I have written before that it is clear the pass mark was shunted so high to ‘flush’ the pool of, in particular, large and increasing numbers of young, inexperienced, international graduates in New Zealand with (on the face of it) skilled job offers. Many thousands of graduates that did what our government, in partnership with local education institutions and their crooked offshore education agents sold them, came here, did courses that lead to a work visa as part of the deal when they finished their course and who - naturally - wanted residence. So they found or bought ‘skilled’ job offers to get them to into the pool with what they expected would be the pass mark. 

Increasingly they dominated ‘selectees’ from the pool through 2015 and 2016 and Government decided (correctly in my view) had to be removed because they were starting to crowd out what the system calls ‘higher quality’ migrants. 

So the pass mark was pushed up high enough that they would never be selected. 

An EOI stays in the pool for six months and if not selected, it lapses. Six months from the pass mark increasing to 160 is the end of April. By then thousands of these mainly young, often Indian graduates will have been flushed out of the system. Objective of the Government achieved (without looking like they had stabbed their international student customers in the back).

My pick for when the pass mark will be allowed to drop won’t be the end of April, it will be when the new skilled migrant criteria are released. We are told to expect these in July.

These new rules are going to make it far more difficult for recent graduates to get the points required - they’ll likely get less points for their age and their jobs often wont pay enough to meet the new definition of ‘skilled’ employment.

So, if it were purely maths driving the process the pass mark would fall now as the annual target is not going to be met at current selection levels.

Given however the Government has to dig themselves out of a hole they created by offering this (well intentioned but naive) study to work to residence pathway, coupled with this being an election year, is where my scepticism tempers my maths.

If the government is willing to box its corner, acknowledging the mismatch between the jobs being created here and the availability of locals to fill these vacancies, then we need at least 27,000 skilled migrants, their spouses and children every year and they will drop the pass mark in July when their new rules come out.

If they are really bold it could be as early as the end of April but being bold, being politicians and this being an election year tends to rule out anything resembling boldness. Especially when it comes to being ‘pro’ immigration. 

If they are looking a bit shaky in the polls my bet is they will let the pass mark fall quietly just after the election in September.

Here at IMMagine we have been able - even at 160 points - to give virtually all of our clients a solution that will get them residence or keep them here till the pass marks fall.

For others trying to negotiate this complex process on their own, this is for you.

Until next week

Iain MacLeod

Southern Man

Tags:

You get what you pay for

Posted by Iain on Nov. 25, 2016, 3:52 p.m. in Immigration

Around nine months ago my colleague Paul sat with an Electrician (I’ll call him Peter, but that’s not his real name) in South Africa and outlined to him and his wife a carefully constructed strategy to get his family to New Zealand within about three months; with electrical registration in hand and with great job prospects. This strategy was tried and true with many other tradesmen down the years.

As we do, a fee was quoted to 'project manage' everything, from the electrical registration in NZ, visitor visas to work visas to resident visas. We advised that, based on our experience we should be able to do all of that and have the whole visa process completed by the end of this year, but more likely around October.

They went away and thought about it. They decided to shop around to see if they could get a better price. They found one (it isn’t hard; there’s always someone cheaper than us). This Auckland based consultancy quoted roughly half what we did. According to Peter, he was told if he paid the entire fee upfront, then the company would discount the price by 20%. When he tried to tie them up on the offer they apparently denied offering the discount. The full fee was handed over nonetheless.

Not being a man of great means and like so many South Africans staring down the barrel of an exchange rate of ten Rand to the NZ Dollar made the call to go with this other agency.

That was in March this year.

Fast forward to last week. He had been here over seven months, had a job on day one but still didn’t even have a work visa; let alone a resident visa.

He arrived in New Zealand around eight months ago. The pass mark then was 100 with a job offer and he’d easily have scored that before the pass mark was increased to 160 in October and now he doesn’t (but we have a solution to that as well).

He got the first job he applied for the day after he landed. Unfortunately, he says he wasn’t told he’d need registration here in NZ with the local electrical workers Registration Board before he left South Africa. Three months after he landed here, still unemployed, he had secured it. By then, his visitor visa was expiring so a new one had to be filed. He was advised to present medicals and a police clearance.

Unfortunately his medical showed high blood pressure (par for the course for stressed out migrants, especially from South Africa) and a further delay was incurred while INZ doctors decided whether or not he was healthy enough for NZ for a further short term stay. At the same time his two criminal convictions (relatively minor in his mind but not to the immigration system) then meant further delay while INZ decided if he met the temporary entry character standard for a Visitor Visa.

In the end the visitor visa was issued and now that he had his registration in NZ with the Electrical Workers registration Board he could file his work visa. 

For reasons best known to his agent, they filed a work to residence visa which created two immediate hurdles - he now had to meet a residence standard of health and the residence standard of character. What many people don’t understand is the health and character tests for short term temporary work visas are a lower test than long term temporary work and resident visas.

So there were further delays.

The most amazing thing about all this (but is testimony to the critical shortage of tradesmen in NZ) is that the employer kept the job offer open.

Earlier this week, Peter came to see me. I assessed the situation, scratched my head over how things had spun so badly out of control and came to the conclusion that the cheaper agency appeared to have badly mishandled the entire case.

Within two working hours of my intervening through my Relationship Manager (INZ has provided us with an amazingly proactive service oriented officer to work with agencies like ours) Peter had his work visa and the character waiver holding everything up was granted. Within 36 hours of that, his wife and daughter’s visas had also been approved. He hasn’t seen them for nine months.

This is less a story about the professionalism of IMMagine and the unprofessionalism of others but more about false economies and how not looking at the "big picture" financial costs and the cost of delays if you don’t choose the right service provider (or try this on your own).

If Peter had retained us back in February this year we would have told him to stay put in South Africa for about three months, keep earning his salary, we’d sort out his NZ registration with the Board and then he would fly to NZ to get his job. We knew he’d find work very quickly. Within 2-4 weeks all things being equal of finding work he’d have his work visa. His wife and daughter could have joined him about four weeks later.

So looking at the rough numbers - sitting in NZ unemployed for probably five months longer than he needed to be - cost him lost wages of around $30,000 (ZAR300,000). Maintaining a home in South Africa while spending precious dollars living here would have added several thousand dollars on top. More than that perhaps, he has been without his wife and daughter now for about five months longer than he needed to be and there is no price you can put on that (but his tears this week did serve as an uncomfortable reminder).

Our fee was twice what those that he retained were charging. However, had he looked at the bigger financial picture he’d have quickly realised that using us for his process would in the end have cost him in the order of $25,000 (ZAR250,000) less than what it has. 

And he is but one. We come across these stories all the time. If people have never heard of us that’s one thing but when people consult with us in many of the markets we operate in we know we lose customers to the cheap and nasty operators (who have no choice but to compete on price).

Our fees allow us to do just what I did for Peter. I could drop everything else because we are ‘boutique’ not ‘volume’ operators, focus on sorting his life out over a number of hours, use my contacts inside INZ, leverage the reputation IMMagine enjoys with INZ for high value and well presented applications and effect a solution so he could starting work and earning a salary on Monday - four days after he came to IMMagine for help.

Even more than that I had promised him when I sat down with him earlier this week I’d do everything in my power to reunite him with his wife and daughter in time for Christmas.

The moral of this story? You get what you pay for. Never more so than with immigration advice.

I see it all the time - in trying to save money we end up by spending a whole lot more.

A quick P.S. - I am off to Singapore shortly for a seminar tomorrow, Kuala Lumpur (4 December) and Hong Kong (10 December). For those of you in those countries this is your last opportunity for 2017 to come and hear what we have to say about how we can help you make NZ your new home; perhaps in 2017. If you wish to register you can click here.

Until next week.

Iain MacLeod

Southern Man

Tags:

Future Skilled Migrant 'Pass Marks'

Posted by Iain on Nov. 4, 2016, 3:48 p.m. in Immigration

Whenever immigration rules change, most potential applicants and their Advisers (not to mention media commentators) tend to conclude that the changes will be in place forever.

There is often a knee-jerk reaction as people throw their hands in the air with horror and conclude the door is not only closed, it is nailed firmly shut and there isn’t a crowbar in sight.

The increase in the selection points for Skilled Migrants from 100 to 160 on 11 October has made many people think that they will have to score 160 points forever.

We have spent the past two weeks explaining to most of our clients that we are able to increase their points claims to the new selection level anyway, which is great for them, but will the pass mark stay at 160 forever?

I doubt it.

The ‘market’ constantly misunderstands what is really going on and why. The important reality that confronts applicant and adviser alike is that just as selection points can increase, so too can they decrease. The pass mark is simply a mechanism for controlling flow. We have all just got very used to it not moving around in recent years.

My assessment of why the pass mark was increased to 160 was, if I may be so bold, bang on the money. It was designed for one reason and one reason only – to flush out of the ‘pool’ those applicants claiming 100 points or more but who, while they had prima facie skilled jobs, these were relatively low quality jobs paying low wages and on the margins of what is considered skilled and not skilled.

The issue here was the sheer numbers of them increasingly dominating approvals. Over recent years the average skilled migrant’s salary has fallen; reflecting more and more recently graduated international students who have studied in NZ claiming places under the skilled migrant category.

I am talking here about your local store ‘Retail Manager’, your recent graduate who suddenly has a job offer as a ‘Restaurant Manager’ down at the local cafe or the ‘Manager’ of any number of small businesses.

All on the face of it, many still have a claim to residence even though many, I suspect, would have been declined anyway once verification was undertaken.

Government, however, simply couldn’t take that risk.

So how do you flush all these EOIs out of the pool and effectively start again once you put in place the new skilled migrant criteria?

Easy: put the pass mark up so high you stop selecting all but those who are older, more qualified and with more work experience. 

As I wrote about two weeks ago – who does a 160 pass mark close the door on? 

Largely, younger people. And which younger people dominate EOIs in the pool?

Recently graduated international students with on the whole, skilled, but certainly more entry level and certainly lower paying jobs than the 30 plus year old segment.

As I keep pointing out – if you only have one resident visa to give away and you have two applicants, both claiming say 100 points, do you give it to the 23 year old who came to New Zealand to study who secures at the end of that study an entry level but skilled job with a low salary? Or do you give it to the 35 year Software Developer with ten years of highly skilled work experience in an area that New Zealand is critically short of?

You want to give it to the older guy with the greater level of experience who is of greater ‘value’ to the economy.

How do you achieve that if they are both in the pool and both on valid work visas, working in these jobs while you put in place new criteria?

You put the pass mark up!

On the face of it, both miss out now and it will remain so in the short term. However for those willing to play the longer game (say, 6-12 months) and stay on a valid work visa then I predict by the middle of next year the 35 year old Software Developer will have enough points to be selected but the 23 year old Retail Manager won’t.

It is public knowledge that officials are shortly to make their recommendations on new criteria for the skilled migrant category. 

I don’t expect any recommendations they may make will surprise anyone inside Cabinet given the haste with which the review was announced and the speed of the public ‘consultation’. They will sign off on the changes designed to knock out the younger applicants (read: a large number of international students in their early twenties with little to no work experience) before the year is out. INZ will then spend six months ‘operationalising’ the new criteria (writing up the new rules, updating websites and application forms) and announce the new rules will come into effect in mid-2017. In the meantime the pass mark will remain beyond reach for enough applicants that the selection process is not overwhelmed.

So here is a prediction – the pass mark will be lowered once again to somewhere like where it has been – perhaps 140 points for automatic selection mid-2017 or thereabouts.

By then the pool has been flushed and thousands of EOIs will ‘lapse’ because they won’t have been selected. If those applicants are still in New Zealand they will no longer meet the ‘new’ rules to be granted residence.

The 35 year old Software Developer, or his contemporary Engineer, Manager, Accountant, qualified Tradesman, Technician, Teacher, Nurse and the like, however, will once again meet the selection points and will be selected. If they play their cards right thereafter they are in with a reasonable shot at residence.

The ‘tsunami’ of EOIs that drove the change in selection points/pass mark two weeks ago will have passed, albeit taking several thousand bitterly disappointed international students with it and the 160 point ‘bar’ will have achieved exactly what it was designed to achieve.

Let’s see if I am right.

Until next week.

Iain MacLeod

Southern Man

Tags:

Alternative Pathways to Residence

Posted by Iain on Oct. 28, 2016, 4:46 p.m. in Immigration

Over the next few months - if not years - there will be some otherwise skilled migrants who won’t be able to achieve the 160 point pass mark even if they were to work for say 12 or 24 months in a job outside of Auckland.

What solutions can we offer them?

I am very conscious that the Skilled Migrant rules will likely change in the middle of 2017, but I am equally confident that here at IMMagine we have a good handle on the direction of those changes, even though we don’t yet know the detail and won’t till the rules are released.

We have a very small number of clients, principally aged over 50 and without any trade or academic qualifications who are still looking for a pathway up this visa ‘mountain’. Without wishing to digress for those tradesmen and artisans under 45 with no formal qualifications we should be able to get them all to NZ using the Australian residence visa process. Something we commonly do now.

One of the ‘NZ direct’ solutions is through a work to residence pathway and finding work and convincing a New Zealand employer to become ‘accredited’ with INZ.

Accreditation is a status given to an employer that allows them to effectively bring in anyone they wish on 30 month ‘Talent Visas' (Work Visas by any other name) without needing to prove they cannot find a local - so long as the salary is at least $55,000 gross per annum, or higher.

No need for it to be in an area of skill shortage, it doesn’t even need to be skilled, but rather INZ needs to be satisfied of a number of key points about the business before they will grant accreditation. The business must be (to quote the policy):

  • in a sound financial position; and
  • has human resource policies and processes which are of a high standard; and
  • has a demonstrable commitment to training and employing New Zealand citizens or residence class visa holders; and
  • has good workplace practices, including a history of compliance with all immigration and employment laws such as the Immigration Act 2009, the Accident Compensation Act 2001, the Minimum Wage Act 1983, the Health and Safety in Employment Act 1992, the Employment Relations Act 2000, Wages Protection Act 1983, Parental Leave and Employment Protection Act 1987 and the Holidays Act 2003.

On the face of it this looks quite straight forward but as always, the devil is not only in the detail but the attitude of INZ and the officer processing the accreditation application.

This category was really set up with the aim of assisting larger employers with an ongoing need to bring in talent, rather than for smaller businesses to keep 'one off' but very valuable staff. It does not however exclude the smaller employers like the three man automotive workshop, the bakery or the small IT company. The aim and objective is clear – to make global skills available to ‘trusted’ local businesses – and it is not for INZ to decide which business is ‘better’ than others if the above four criteria are met; nor which applicants or roles come with a greater economic need.

I suspect, however, as more employers now apply for accreditation owing to the tightening of criteria under the Skilled Migrant Category and a seemingly never ending tightening in the availability of local candidates for roles, INZ could try and make it difficult. So, yet again, strong and persuasive advocacy will no doubt be called for and we are well positioned to help companies to secure this status.

For the migrant, their Talent Visa will be granted for 30 months and after two years of working for 'an' (not necessarily ‘the’) accredited employer they can then apply for residence. It is not a points system and there are no quotas nor pass mark. They do, however, have to demonstrate they are still healthy (along with partners and children) and their character remains good. They will also have to prove they earned at least $55,000 by way of salary over the two years. Note: salary, not income.

With the ramping up of pass marks for skilled migrants two weeks ago coupled with the sort of changes we strongly suspect are coming next year, having an Immigration Adviser who is not only expert in the detail but creative in arguing some very vague sounding criteria is going to take on even more importance than it ever has.

From here on under the skilled migrant category, it is not only a case of the survival of the most employable but it might just also be the survival of those with the smartest Immigration Adviser.

Work to residence options are no different. I am expecting push back from INZ on these applications but the rules are the rules and whether the company is large or small or needs to bring in ten workers or one; it is not a value judgement for officials.

Finding alternative pathways up this seeming every higher and steep mountain is what we do very well with 26 plus years’ experience under our belts.

Work to residence on a Talent Visa is just one of those strategies that might be the difference between raising your children in New Zealand or somewhere else.

Until next week.

Iain MacLeod

Southern Man
Letters from New Zealand

Tags:

Skilled Migrant Category Review

Posted by Iain on Oct. 21, 2016, 3:49 p.m. in Immigration

Control.

It’s the thing about Governments everywhere I suppose. They have to give the illusion of being in control even if they are not.

The announcement two weeks ago of the pass mark increasing to 160 from 100 had an instantaneous impact on the numbers of Expressions of Interest being selected from the pool - it cut them by around 50% which was exactly what was intended. No surprises there.

The demonstration of lack of control came from the fact that the numbers of EOIs sitting in the pool that the computer had to select because ever increasing numbers were claiming 100 points or more including an offer of ‘skilled’ employment was allowed to grow and grow and grow. In the end the Government simply had to act - the ‘tsunami’ of EOIs I have so often written about and spoken about at seminars was washing ashore. Big time.

I still get this picture in my mind of Government Ministers standing in a huddled group on a beach with their backs to the sea wondering why everyone was running away for higher ground.  With puzzled looks on their faces they are asking one another ‘What’s the threat? What’s the problem? We can’t see any problem.There’s no problem here’.

Having been told by those that should know less than six months ago the Skilled Migrant Category was not going to be seriously reviewed for some time (policy review priorities lay elsewhere, principally with the Investor and Entrepreneur Categories) all of sudden the Minister announces that it is in fact being reviewed. Nothing to do with the system about to crash under the weight of EOIs, nothing to do with focus groups and polling showing immigration is going to a very hot topic in the run up to next year’s elections, nothing to do with the fact that the ‘quality’ those being selected has been falling for some time, nothing to do with Auckland house prices…..all now seemingly just one of these three yearly reviews ‘we always do’. A ‘tweak here’ and a ‘tweak there’ as you do when you are on top of the situation.

Except this one wasn’t gong to be reviewed for some time yet…and it won’t just be tweaks.

Government released a hastily put together public consultation document this week and has asked for feedback on how the rules might be ‘tweaked’ in order to improve quality. Over about two weeks.

What is clear is that New Zealand is in great demand as a migrant destination and we can choose who we want and likewise who we don’t want when we have so many to choose from.

So who don’t we now want?

The consultation document is interesting in that it essentially confirms everything I predicted it would in last week’s blog.

If the changes which are at this stage (if you can believe it) only talking points you can expect by mid 2017 to see a shift toward:

1. More highly educated applicants i.e. whereas qualifications have not been a pre-requisite for entry for the best part of five years now, they will play an increasingly important role in the future. The days of getting a resident Visa based on your age, work experience and having a skilled job offer are over for the time being.

2. More highly paid applicants - there is clear signal that entry level but skilled job offers are not going to be enough to get younger applicants over the finish line - I predicted last week salaries would come into the mix to both assist with determining skill level of jobs but also to act as a mechanism to prevent younger, less experienced applicants taking places in the programme away from older more experienced applicants.

3. Potentially applying a minimum work experience requirement on all applicants - designed clearly to cut out the young, international student who has studied in New Zealand. This takes  a leaf out of the Australian song book which they also introduced a few years ago to deal with the same issue of over promising international students a pathway to residence in order to develop an export education industry.

4. To focus through points on those aged 30-39 as being the ‘optimum’ aged applicants. This shouldn’t mean that older applicants won’t be able to still qualify and I’d suggest for those with higher education, jobs outside of Auckland and higher than median salaries they’ll still be okay.

I made the suggestion last week these rushed changes now and the more considered ones to follow in 2017 is designed to all intents and purposes to solve one problem - when you have a 23 year old who came to NZ to study (on the promise by the government of a pathway to residence) but that youngster is competing say with the 35 year old software developer for a single place in the SMC programme, the government was  forced  to decide which of the two was of more ‘value’ to the economy.

The answer is obvious to me but it does not bode well for the tens of thousands of international students lured here by Government, less than honest education agents overseas (unlicensed) and a fair number of private and public education providers who saw nothing but fees and commissions at the end of a principally Indian rainbow.

I was invited to a meeting a few nights ago where the Minister of Immigration was speaking to a small group of predominantly white, oldish men in cheap, ill fitting grey suits (bankers and investment types for the most part). Never have I seen a man’s lips move so much without actually saying very much and when he did it was by and large, garbage.

With a completely straight face he laid the ‘blame’ for the unfortunate reality about to confront thousands of international students who will not now get residence firmly at the feet of (unlicensed) education agents. 

For the second time in a week I heard him say ‘We (the Government) never promised anyone residence. Coming to New Zealand should only ever have been about getting a ‘world class’ education.’

That will come as a surprise to more than a few students. If this is the case why did the Government offer them all open work visas when they finished their study if it wasn't designed to provide a pathway into a labour market and from there to a resident visa?

Now that rug has been clumsily pulled from right under their feet, not by agents but by the government, Ministers I guess have to be seen to be controlling the situation as if this was their plan all along.

I’d be interested what a lot of these international students might think about it all given for a great number of them their dreams of settling here have been ripped out from under them and by mid 2017 any chance most have will surely be extinguished for good.

My only surprise about all this is that so far few seem to have cottoned on to what the Government has just done.

What they have done last week is to stick their finger in the dyke to try and hold back this ‘tsunami’ of graduate students looking for residence but the point that appears to have escaped these youngsters is how the government is about to start draining the lake behind the dyke without those frolicking in and on it realising they are the ones about to be drained.

I have to say it is quite a sight to watch the Government try and defend the indefensible and how incredibly well they seem to have done so. Equally how their target appears to have missed it completely (and by and large as has the media).

Whilst they were rapidly losing control of a situation of their own making the Government is doing a jolly good job of making it look they are in control. 

First line of attack - blame someone else.

Until next week

Iain MacLeod - Southern Man


Holding Back the Student Tide

Posted by Iain on Oct. 14, 2016, 9:57 a.m. in Immigration

After the upheaval of this week with the changes to the skilled migrant landscape and a few days to take it all in and digest the changes, you might be interested in my thoughts on it.

The changes appear to have been made in a big hurry. I have written several blogs in recent months and have been telling any potential client that might listen that I believed that change was going to be forced upon the Government in the skilled migrant ‘space’.

Why?

In two words – international students.

Tens of thousands have flocked to New Zealand in recent years to study, I suspect, only because the Government offered them an open work visa when they finished their course and through that, a pathway to residence under the skilled migrant category once they had secured a skilled job offer.

I have spoken of the ‘tsunami’ of Expressions of Interest that would start to wash upon the skilled migrant shores expected in late 2016 and through 2017 at every seminar I have delivered in recent times. Given there is a fixed number of skilled migrant visas available each year this massive increase in demand represented a clear threat to the entire skilled migrant programme. It was in danger of collapsing under the weight of applications.

When you operate a fixed pass mark of 100 points for those with skilled job offers and you have a finite number of resident visas to dish out, what do you do when the numbers being selected every two weeks from the pool who have claimed 100 points goes through the roof?

How does the system respond when, if they were all to be granted a resident visa, your annual target of 27,000 migrants would be filled within, say, six months? Would INZ just close the pool to further selection for another six months?

That is exactly what the Government was facing, yet until relatively recently I am reliably informed they did not accept.

The evidence was right in front of their faces.

In the past three pool draws alone the ‘normal’ 700 EOIs selected each fortnight for those claiming 140 points or 100 or more including a skilled job offer jumped from 700 to almost 1000. A 50% increase. 

We know that close to 40% of all skilled migrant approvals of late have come from former international students who studied in New Zealand and decided to stay. That percentage has been growing steadily in recent years.

I’d wager a close examination of those selected of late would reveal a significant percentage would be single young males, predominantly from India, with little to no work experience but an NZ qualification claiming points for job offers as Chefs or Retail Managers.

So the question confronting the Government (and the question some of us have been asking of them for a long time now) was – which skill sets does New Zealand need more of? The 24 year old international student who has studied in NZ but has little work experience and a job offer as a ‘Retail Manager’ or the 35 year old Software Developer with 15 years of work experience whose skills are desperately needed?

They can say whatever they like in terms of why they made the changes they just did but that was the dilemma facing the Government.

The solution?

Put the pass mark up to 160 points. Who does that knock out? 

Young inexperienced applicants with qualifications but with little to no work experience. Who dominates that demographic? International students, predominantly  from India. To be clear this is not an anti-Indian move it is jut they are the ones disproportionally impacted by the change as they make up the bulk of international students.

If I were a young international student who came to study in New Zealand having been, at worst, encouraged through the marketing carrot of the work visa and the residence, I might be more than a little miffed right about now. Their residence dreams will pretty much be in tatters.

Having worked through the options available to our many clients we are currently supporting with their applications, the fallout has by and large been minimal. At worst some are going to have to secure jobs outside of Auckland and some might have to delay filing their applications for a year or so while they accumulate additional points through New Zealand work experience. We have managed to give almost all of them a revised strategy to get them through this minefield.

The Government’s changes have however created another very real problem yet to be addressed.

There are tens of thousands of highly skilled jobs being created each year in Auckland. The mismatch between local skill sets among the unemployed and those jobs means these employers are not going to be able to fill many roles with migrants because those migrants now know they won’t have enough points if they accept the jobs.

Auckland is the nation’s jobs machine and many of the new jobs being created are in IT and trades related roles yet many of these applicants do not have qualifications that are now critical to securing the 160 points. 

These people have to look at going south or not coming at all (or appreciate their stay will be short term and on a work visa which most won’t tolerate; they simply won’t come).

So having dealt with the issue of the ‘tsunami’ the Government now has to come up with a solution that keeps intact Auckland as a migrant destination for the highly skilled without bursting the dam that is holding back the international students.

The simple solution would be a minimum salary threshold for jobs in Auckland that attracts additional bonus points. It would be an elegant solution (so long as you are not an international student) because it would reward the more experienced and the more highly paid; both of which tend to indicate a higher value skill set and greater value to the country.

My feeling is more changes will be announced soon because they need to be.

You cannot have a skilled migrant policy that now starves thousands of Auckland employers of desperately needed skills. The Government is smart enough to know it. They will come up with a solution packaged as ‘we only want highly skilled and high value migrants’.

This is simply code for ‘We blew it offering all those international students a pathway to residence but hey, we never promised them a resident visa...’

It isn’t pretty and there’ll be several thousand international students about to feel horribly let down.

It could have been avoided if the Government hadn’t been blind to the real reason the bulk of the students were coming to New Zealand – the study was just a part of their plan to secure residence.

Until next week...

Iain MacLeod

Southern Man

Tags:

Shake Up of the Skilled Migrant Category

Posted by Iain on Oct. 11, 2016, 12:38 p.m. in Immigration

A few minutes ago the Government announced (or shortly will) a number of changes to the Skilled Migrant Category which take place today.

On the face of it, it looks quite radical but upon closer reflection isn’t quite the ‘revolution’ the Government will paint it (and no doubt the media will swallow) and is little more than a rearrangement of the deck chairs. Unless you are an international student hoping to get a resident visa in which case your future in New Zealand is looking fairly bleak...the Government is about to do to them what the Australians did to their international students a few years ago.

Our Government will today announce ‘cuts’ to migrant numbers but it appears to me to be a case of smoke and mirrors more than anything else in order to:

  • Take the wind out of the anti-immigrant NZ First party’s sails; and
  • Be seen to be taking additional pressure off Auckland house prices (some skilled migrants will now have to find jobs outside of Auckland); and
  • Close the doors on tens of thousands of international students that were promised open work visas upon completion of their studies by this Government as a pathway to residence. For most of them door has just been slammed shut in their faces and their futures lie outside of New Zealand.

The cuts, such as they are, are coming principally from the Family Stream and the overall target of migrants per immigration year is remaining about the same (at 85,000 – 95,000 over the next 24 months). So there is really no overall cut in substance.

The only real cuts apply to the Parent Category which sees numbers reduces from 5200 per annum to 2000. This is going to have the result of pushing out waiting times, but not the overall outcome for parents wishing to join their children in NZ.

From Wednesday 11 October all ‘classes’ of Skilled Migrants will have a fixed pass mark of 160 points. That is up from 100 for those with job offers and effectively means everyone will need a job offer to qualify.

As I have been pushing for some time now English testing is becoming mandatory. There will be exemptions but only for those from the USA, UK and Canada or for those with recognised qualifications from (and presumably studied in) those countries.

While this appears to be a radical increase in what is required to gain entry it really only impacts on those that have cannot squeeze out additional points by working for a period of time in NZ, work in an occupation which affords them previously unrequired bonus points, have family in NZ or a partner who can also get skilled work.

Our initial analysis, albeit without an enormous amount of information to go on apart from what we have learned from INZ; suggests most of our clients will be able to make an plan.

Those with recognised degrees (or higher) and even many with lower level qualifications such as tradesmen and Technicians will almost certainly still qualify if they get employment outside of Auckland and if they are in a relationship, get the partners out to work as well.

Unless...there is a twist in this tail.

We are reliably advised the Government recognises the potential negative impact on very high value migrants but who might not have degrees who have jobs in Auckland and a labour market screaming out for their skills – think IT specialists who are industry experienced but with no degree, CEOs without MBAs, senior management who came up through the ranks and the like who will be based in Auckland and have very high salaries and much to offer...INZ has been told to carry out some additional work which we expect to become policy in the next few weeks.

I understand that might involve additional bonus points being awarded for salaries over a certain annual level to compensate for the new pass mark. Or something which provides a similar and certain outcome.

The number I have in my mind is $70,000. No word on how those changes might translate into points but mark my words: such a change is designed to keep the Auckland job market open to those with high enough salaries (thanks to their being highly skilled) to warrant acknowledgment of the value they bring to the economy and the need for them in Auckland. Given it is the engine room of the economy what the Government is clearly trying to do here is to make sure that the finite numbers of skilled migrant places are taken up by the highly skilled and highly valued migrants and not recent international graduates with lower level qualifications. A bummer if your parents mortgaged their future in a village in Gujarat to send you to NZ for a better life but that’s Governments for you. I have spoken publically about the ‘tsunami’ of Expressions of Interest that will result (already is) in thousands of lower skill level applicants swamping the ‘pool’ for some time and telling anyone that would listen that change will be forced upon the Government if they do not act.

Well, they have.

Perhaps, when the Minister of Immigration was publically quoted, in regards to the tens of thousands of international students looking for a resident visa, ‘they won’t get residence’ recently, he wasn’t joking. He knew the Government was about to pull the rug out from under their feet.

I hate to say it but I told you so. It was so obviously going to have to happen or the Skilled Migrant Category would collapse under the weight of these applicants.

My advice to those from the English speaking world all this change really suggests to me is:

  • You’ll need to get a job offer outside of Auckland unless you can pick up bonus points; and
  • Qualifications are back in vogue and will be more important than they have been in recent years;
  • Government will find a way within the next few weeks to provide a pathway to 160 points for those on higher salaries than ‘average’ with jobs in Auckland

For existing clients, we will be back in touch with you within the next few hours to explain how these changes affect you.

Until we can tell you more...

Iain MacLeod

Managing Partner, IMMagine Australia & New Zealand

Tags:

To Deport or Not to Deport

Posted by Iain on Sept. 16, 2016, 3:53 p.m. in Immigration

I was asked two weeks ago what I think about the fact that 41 Indian international students have been served deportation notices recently over actions allegedly made by their unlicensed migration agents in India in respect of student visas.

My response?

It stinks.

If they did nothing wrong.

However like all of these stories, there is more to it than meets the eye.

Plenty of us in this industry have been banging on at Government for a few years over the fact that they allow immigration advice to be dispensed to vulnerable migrants if that advice relates to studying in New Zealand. Anyone else on this fair planet of ours giving immigration advice about working, applying for residence or visiting must be licensed and is held to some fairly rigorous standards of competence and ethics or they risk losing their livelihoods.

Government decided (I suspect because export education is a sunrise industry currently worth $3 billion per year and employing over 30,000 people) not to apply the same rigorous standards to agents peddling education in this country.

Given most students are spending between $20,000 and $30,000 per year to be international students, one wonders why they are without any protection from the unethical or the incompetent. Many of these students are only in New Zealand studying because the Government is dangling ‘open’ work visas at the end of their period of study as a pathway to residence and sure as eggs, the agents offshore are sharing (unlawfully because that is immigration advice as defined by our laws) that carrot to them and marketing this pathway to residence.

To be fair on the Government they are trying to get the education providers to clean up their acts and are increasingly holding these education providers to account for the agents they use and recommend to intending students. Work with the unscrupulous and the institutions can lose their right to have international students. So to a degree Government is relying on self-regulation.

While regulation does not solve all ills, nor does self-regulation prevent scams or fraud, and it does little to protect these vulnerable students.

Having said that, the Government claims that these agents presented (among other transgressions) false financial statements on behalf of the students. The students claim this was done without their knowledge.

I have little doubt that in an unregulated market like India and China where ripping people off is a way of life for some, false information may well have been presented on behalf of some students – this sort of thing has been going on as long as visas have existed.

Where though does the responsibility lie for applicants in understanding what the requirements are and what is being submitted on their behalf?

Did none of the students read the application forms they signed and dated which at the very least asked them to make certain statements and provide certain information about how they were going to support themselves if the visa was approved?

If they had not given the agent any evidence of their financial support plan, what did they expect would happen? INZ would let them off the requirement to prove financial support? Or did the agent tell them ‘not to worry about that, I will do the needful’ and not question what the ‘needful’ might involve?

My view is they do not have to be experts and the reason people seek professional advice in any industry is to ensure as best as possible that accurate and truthful applications are made, but there is still a degree of responsibility for the client to read the forms that are being filed on their behalf. And to ask questions (in writing) if they are unsure of what is happening or why.

For students, after being enrolled in a course of study, how they intend paying for it and how they intend supporting themselves once here is the next most important issue. 

Did any of these students do that?

If they did, they should not, in my view, be held responsible for what happened next.

If not, can they now really complain that it was nothing to do with them?

Here at IMMagine we routinely complete forms (or at least check forms) for our clients to ensure what goes to INZ is factual and can be independently verified if needs be. We always ask the relevant questions of clients beforehand to ensure what goes in those forms is accurate. All clients are told to read the form before they sign and date it or to ask questions if they are unsure. 

It is a very harsh lesson for these young people to learn given most, I am sure, come from families where the amount they have paid to complete this tertiary study will not be refunded and represents for many an ‘investment’ that might never be recovered. It is also harsh because most have been duped, I suspect.

The New Zealand Government does not make it easy for these students by continuing to allow unlicensed agents to give important immigration advice to the vulnerable.

If the rest of us who give immigration advice have to prove on an annual basis our ethics and competence like lawyers, teachers and any other number of other professionals and pay over $2000 each year for the pleasure; it beggars belief that the Government has exempted those peddling student visas.

It is hard to escape the conclusion that because this is an industry that the Government wants to double in terms of value to the economy to $5 billion within the next four years, they are willing to turn something of a blind eye to the obvious and ongoing fraud occurring in the marketplace. I suspect they tell themselves around the cabinet table – if we force these agents to get licences at $2000 per year they’ll stop peddling NZ and start peddling the US, Canada and the UK. I am pretty sure they’d be right!

Licensing was designed to ‘protect vulnerable migrants’. Who is more vulnerable than a 20 year old Indian national whose family might have mortgaged their next ten years of income to send their child to New Zealand to get an education?

What damage is being done to ‘brand’ New Zealand by the Government continuing to allow this rampant fraud to continue?

Whatever it is the price is too high – both for international students and our national reputation.

Nobody wins in these situations.

Until next week

Iain MacLeod

Southern Man

Tags:

A New Dawn

Posted by Iain on Aug. 5, 2016, 2:32 p.m. in Immigration

While a single swallow a summer does not make, there are tentative signs that the efforts by a small number of us in the immigration industry and the Leadership of INZ to forge a closer relationship, after two decades of what can only be described as 'mutual distrust'.

As someone who is a strident critic of the failures of Immigration New Zealand (INZ) to acknowledge the value of the better Immigration Advisers in the marketplace to applicants (not to mention INZ itself) it seems, at last, those in charge of processing and issuing visas now ‘get it’.

Good Advisers are neither a threat nor a nuisance – we enhance the process for applicants who cannot hope to understand the complexities of the system and make it easier for Immigration Officers to process these applications, the thinking largely done for them.

We do the marketing, we do the ‘sorting’ of those that cannot qualify and might otherwise ‘clog’ up the system and we provide assistance and support to those looking to settle in NZ, taking a lot of the pressure off INZ itself and other Government agencies.

We have pushed INZ for some time for what your local bank might call a ‘Relationship Manager’ to be available to those of us with reputations for professionalism and a track record of preparing high quality applications for high quality migrants. We now have one, and it is like the sun has come out after a long, cold winter.

This new ‘channel’ has allowed us, for example, in the past four weeks to get work visas issued as 'exceptions to the rules' for two clients who needed to start work in highly skilled jobs, but whose visas were being delayed by minor medical matters needing to be ‘cleared’ by INZ Doctors. The delays caused by these medical referrals has recently doubled processing times, from 2-4 weeks to 6-8 weeks for work visas. That delay gives further incentive to employers to withdraw job offers or not offer them in the first place.

Many a potential skilled migrant has lost their job offer because of it. Very nice to be able to make a phone call and get these work visas issued as an exception, which, in turn, allows everything else (including these families resident visa applications) to keep moving forward.

We have also now had our first South African client issued his Visitor Visa for the purpose of coming to New Zealand to look for work so he can be part of the Government’s skilled migrant residence programme. A welcome relief all round, as increasing numbers of South Africans are being questioned en route and the internet is abuzz with stories of (a minority it has to be said) South Africans being offloaded or refused boarding on their flights to New Zealand. 

As the risk attached to this visa waiver agreement increases with the ongoing deterioration in the South African economy and society, it is nice to have been able to sit down with senior INZ management and come up with a solution for our clients which reduces the risk to all parties – including the NZ Government.

Anything that allows our clients to travel without the added and unnecessary stress of wondering if they will draw the short straw and be stopped and questioned is an understanding I was happy to negotiate and enter into with INZ on behalf of our clientele.

The move toward greater centralisation of processing many resident visa applications in New Zealand is also welcome, as INZ struggles to act consistently in the processing of visas at its many offshore branches.

We have been ‘banging on’ for some years that bringing all the resident visa processing under one roof should enable more consistent decision making to occur. Our biggest gripe (among many) has been that the far flung branches of INZ have historically all interpreted the same rules in different ways.

The same evidence presented in order to prove some criteria when viewed by two officers in different branches constantly leads to two different outcomes. This is highly frustrating and unprofessional and leads to constant conflict. Hopefully bringing all our cases under the one roof is going to improve consistency.  

I should add that while I am optimistic that at last INZ is waking up to how to run a real business, there is still a long way to go. Until they have competition (which will never happen) and the disciplines that competition imposes on those of us in a competitive marketplace, they will never function as the private sector must to survive.

At last, however, we now have some light at the end of the tunnel and it is very nice to know that INZ will acknowledge that the ‘one size fits all’ service delivery model is less than helpful and working with companies like IMMagine rather than working against us is going to help all parties - them, us and by no means least, our customers seeking their visitor, work or resident visas in New Zealand.

Until next week

Tags:

Migrant Numbers on the Political Chopping Block?

Posted by Iain on July 8, 2016, 4:23 p.m. in Immigration

And so it begins...

Just over a year out from the next election with house prices (particularly in Auckland) resuming their heady increases once again (5% in the past three months), a Central Government and Auckland Council seemingly unable to markedly change the supply side of the housing shortage, right on cue the usual political suspects have started calling for a slashing of immigration numbers.

For me this jibber jabber would ordinarily be like water off this duck’s back but this time I am less sure. These are not normal times.

It all starts to look a bit more serious when it's the Reserve Bank that starts advising the Government they need to look at migrant numbers...and that is to be taken far more seriously than when populist politicians seeking a few votes or the xenophobic chatterati vent their spleens and seek to blame migrants for Auckland’s housing (un)affordability.

Post the GFC and with New Zealand’s relatively buoyant economy, thousands of New Zealanders who might otherwise have gone overseas have stayed home feeling secure in their work and homes. Tens of thousands more have decided to return home. More Australians than ever before have decided to take advantage of the ‘no border’ rules that apply to them and our stronger labour market and the Government continues to grant the usual number of Resident Visas it always does (and tells us repeatedly the ‘numbers are about right’).

That, however, doesn’t take account of their political drive to be re-elected and I am asked increasingly: Do I think the Government will cut immigration numbers?

If any logic were to be applied, the answer is no. Skilled Migrants are overwhelmingly filling jobs here that employers are unable to fill with the locally skilled. If locals are available I have met few employers willing to go through the bureaucratic torture of the Work Visa process as many of you reading this will know through bitter experience.

The Government cannot force New Zealanders to leave our country; nor can they prevent New Zealanders coming home. They cannot stop the Aussies coming here in search of a more secure existence.

They could put in place the same rules for the Australians coming here as the Australian Government has put in place for our people moving over there – less access to social security and education benefits put in place to discourage Kiwis going to Australia. That might put a few Aussies off but it would just be tinkering around the edges.

So the easy cut - if one was to be made - is migrants from everywhere else.

There is no rational argument in an economy that is creating tens of thousands of skilled jobs to see them go unfilled and that would be the impact if skilled migrant numbers were cut.

New Zealand has a real problem that the jobs that are being created are very often not able to be filled from the local labour market much of the time. That is because our young people, it seems, don’t want to become Engineers or IT professionals (we only produce half the graduates in these two disciplines the industry needs); they all want to get Marketing or Law degrees.

There is without doubt a mismatch between the jobs being created and the skills we produce locally. We need skilled migrants to continue to prosper economically.

If the Government turns the migrant tap off what are the thousands of New Zealand employers desperate for skills we do not produce going to do?

We cannot cut back on the numbers of resident visas being issued to partners and children of New Zealand citizens or PR holders.

I guess they could do two things:

  • Take the razor to the number of parents being granted residence each year - but it is only 5000 and I suspect most of them are not putting pressure on house values as a good many of them end up living with the children who sponsored them. (And outside of Auckland to boot.)
  • Force all skilled migrants to get a job (right now it is ‘only’ the significant majority). Drop the automatic pass mark of 140 for those without job offers. 

As sure as the sun will rise on the morrow the clamour to cut back on migrant numbers will only increase over the next few months.

To me it shows just how poorly planned economies like ours are. No five year plans. No long term vision. Just Politicians minding the farm, really. 

To be fair, perhaps no one could have predicted the massive (but cyclical) increase in net migration numbers and it is a good problem to have – lots of jobs, great place to live, fewer Kiwis leaving, more coming home. It’s a problem not borne of negativity but the complete opposite.

Those in the Auckland housing market are getting richer by the day (if they sell) but it goes to the heart of what we are seeing all across the Western World – increased disenchantment at increasing levels of inequality. Trump could actually win! Brexit fuelled at least in part by inequality and xenophobia. Australians being unable (again) to elect a Government with the country split right down the middle.

And out of this disenchantment bottle often pops the xenophobic genie.

My prediction is that over the next few months the political party New Zealand First, which stands on a platform of slashing migration, will be peddling its propaganda to its 70 year old plus supporters that 1963 NZ really was a pleasant little (white) paradise which they can have back simply by voting for that party! I have little doubt NZ First will experience a spike in popularity and an increase in the polls as those who don’t like this multicultural New Zealand will feel they can come out of their xenophobic closet with gusto. They’ll take some of their support from the ruling Conservative National Party but more from their obvious centre left coalition partner, Labour.

If that happens and it looks like the leader of NZ First will hold the balance of power after next year’s election, I am pretty confident the current Government would act to try and pre-empt that and cut migrant numbers.

I am hoping that in the next few weeks when the Auckland Council releases its long awaited and much fought over planning document, it is going to allow increased density of housing.

Coupled with that I believe central Government will take further action to force an increase in the supply of land for housing, and the Reserve Bank will make it harder for investors to borrow money for housing in Auckland.

If that happens, the migrants might be spared.

We can but hope so.

Until next week

Iain MacLeod

Southern Man

Tags: