Australia's 2026 Federal Budget: Key Migration & Skills Reforms
The 2026 Australian federal budget has confirmed the permanent migration program cap at 185,000 places, with a strong focus on skilled migration and onshore applicants.
Over 70% of all permanent migration places are reserved for skilled migrants.
Allocation and Priorities
The government will prioritize applications from onshore migrants across both the skill and family streams. Of the total places, 55,110 offshore spots will be allocated primarily to high-skilled migrants to address Australia's long-term skill needs.
Boosting the Skilled Trades Workforce
A major investment of $85.2 million will be used to accelerate skills assessment tests for migrant trades workers and facilitate occupational licensing. This initiative is expected to:
- Reduce workforce entry time by up to six months.
- Enable up to 4,000 additional skilled trades workers per year, especially in construction and electrical sectors.
Additionally, Trades Recognition Australia will deliver a new program of skills assessments specifically for onshore visa holders.
Worker Protections and Integrity
The government will spend $27.0 million over two years to inform migrant workers about workplace safeguards, protections, and migration law compliance. To maintain system integrity, $19.8 million over four years will be allocated for enhanced scrutiny of both onshore and offshore student visa applications.
Changes to Visa Programs
- Working Holiday Maker (WHM) Program: The program will expand the use of ballots to better control numbers and provide a fairer allocation of places.
- Adult Migrant English Program: From 2029, this program will be reformed to offer flexible tuition and student supports, targeting those most in need.
Broader Reforms
The government intends to reform the permanent migration points test, which currently selects almost two-thirds of permanent skilled migrants, to optimize the selection process. Specific priorities for education and skills backgrounds have not yet been detailed.
Key Statement
Treasurer Jim Chalmers stated that English proficiency is an important skill for workplace communication, but acknowledged it is not the only skill that matters.
These measures are part of broader migration system reforms aimed at addressing critical worker shortages across the Australian economy.