The Numbers Behind the Noise: What Immigration Really Costs — and Contributes — to Australia
- Bain Dohne
- May 18
- 5 min read
Published by the Odyssey Leadership Foundation Written by Bain Döhne - CEO & Founder
Few topics generate more heat in Australian public discourse than immigration. It is raised at election time, in talkback radio segments, across social media feeds, and increasingly in the policy platforms of minor and now major parties. Party leaders are quoting comments from the general public as fact, rather than referring to legislation, thereby furthering misinformation rather than clearing it up.
Yet the gap between the emotional intensity of the debate and the quality of evidence informing it is striking — and consequential.
For young Australians preparing to participate in civic life, understanding what immigration actually involves — economically, fiscally, and socially — is not a partisan exercise. It is a foundational literacy skill.
This post sets out the evidence plainly, with references.
What Do Migrants Actually Pay?
Most migrants working in Australia are taxpayers. Every person earning income in Australia — regardless of visa status — pays income tax on Australian-source earnings. GST applies universally to goods and services consumed here.
The Medicare levy — 2% of taxable income, which funds the public health system — applies to permanent residents and citizens. Temporary visa holders who are not eligible for Medicare are generally exempt from the levy. They are, however, often required by their visa conditions to fund their own healthcare through mandatory Overseas Visitor Health Cover (OVHC). Under Visa Condition 8501, holders of many temporary working visas — including the 482 Temporary Skill Shortage and 485 Temporary Graduate visas — must maintain adequate private health insurance for the full duration of their stay at their own expense.¹ They contribute to the tax base without drawing on Medicare.
Skilled migrants, who form the largest component of Australia's permanent migration program, are typically working-age, employed, and contributing to government revenue. The picture across a lifetime is clear: according to Treasury modelling published in December 2021, the average primary skilled migrant contributes approximately $198,000 in net terms to government finances across their lifetime.² That figure accounts for both the taxes they pay and the services they access.
What Can — and Can't — Migrants Access?
This is where public understanding often diverges most sharply from the law.
Most newly arrived migrants — including permanent residents — are subject to the Newly Arrived Resident's Waiting Period (NARWP) before they can access most welfare payments. According to Services Australia, new residents must wait up to four years before becoming eligible for most payments and concession cards, including JobSeeker, Youth Allowance, Austudy, Carer Payment, and Mobility Allowance.³ The waiting period applies from the date the relevant visa is granted and does not count time spent overseas.
This is a point that receives remarkably little coverage in public debate. Migrants are frequently characterised as arriving to access welfare — yet the legislative framework deliberately restricts access for the first years of residency.
Humanitarian entrants — refugees — operate under a different framework, with faster access to settlement support services. This is intentional policy design: people arriving under humanitarian circumstances often require immediate wraparound support. It is also worth noting that humanitarian migrants represent a small proportion of Australia's total annual migration intake. Refugees are also explicitly exempt from the NARWP.³
What Happens When Immigration Is Severely Restricted?
This is the critical question — and the evidence here is robust.
Australia's population growth is structurally dependent on net overseas migration. Without migration, Australia's dependency ratio — the number of retirees relative to working-age adults — deteriorates rapidly and significantly. A younger, working migrant population directly reduces pressure on the age pension, healthcare, and aged care, all of which are funded by working-age taxpayers.
The Productivity Commission's 2016 Migrant Intake into Australia inquiry modelled the long-run impact of Australia's existing migration program relative to a zero-net-migration scenario. The findings were significant: continuing historical levels of migration to 2060 would increase Australia's GDP per person by approximately 7% relative to the zero-migration alternative, and would limit the share of the population aged 65 and over to around 25%, compared with approximately 30% under zero migration.⁴
More recent research reinforces the picture. A 2021–2024 joint project between Australia's Centre for Population and the OECD found that migration boosts the labour productivity of Australian-born workers, increases their employment, and drives innovation — a 1 percentage point increase in the regional employment share of higher-educated migrants is associated with a 4.8% rise in regional patent applications in the medium run.⁵ Migrants are significantly over-represented among Australia's research and innovation outputs.
The IMF's 2023 country assessment of Australia confirmed positive macroeconomic outcomes from migration shocks and noted that nearly 60% of Australia's migrant population holds tertiary qualifications — well above the OECD average of around 40%.⁶
The Complexity Worth Acknowledging
Honest civic discourse requires acknowledging that immigration is not without genuine tension points.
Housing affordability is a legitimate concern — population growth, including from migration, places demand pressure on housing supply, particularly in Sydney and Melbourne. The question of whether the primary response should be improved housing supply policy or reduced migration is a genuine debate; economists hold differing views.
There are also distributional questions — migration policy shapes who benefits and where. Skilled migration programs are designed around employer and economic need, which may not always align with regional development priorities or community cohesion considerations.
These are real policy debates. They deserve rigorous, evidence-based engagement—not dismissal or inflammatory simplification.
Why This Matters for Civic Education
At the Foundation, we work with young Australians to develop the capacity to engage with exactly these kinds of complex, contested questions — to find the evidence, understand the trade-offs, hear competing perspectives, and form reasoned positions.
Immigration is one of the most consequential policy debates of our time.
The young Australians who will vote on it, work alongside migrants, contribute to the tax base that funds public services, and eventually lead institutions and governments, deserve to understand what the evidence actually says.
That is the purpose of civic education. And it begins with a commitment to honest, grounded, evidence-first conversation.
Post-script: Global Warming!
This is something I've been keeping an eye on but didn't add to the original blog post, since I was mostly aiming it at the misinformation being spread about this topic.
We cannot, although many do, ignore the issue of global warming. This is a situation in which many global citizens have decided to bury their heads in the sand, hoping it will just go away. But it won't, and will be catastrophic in the end.
As the earth continues to heat up and polar ice continues to melt, low-lying Nation States will begin to submerge, such as Tuvalu, Kiribati, and the Marshall Islands, which are all in the Pacific Region, and will be the first to submerge. Current projections based on current information indicate that Tuvalu will no longer be above water by 2050. That's ~11,000 people that need to be relocated, homes, families, language, culture, history, et al.
At some point in either our or our youths' lifetime, this will become a very real issue, one where citizens must decide whether to permit these nations to move or agree to commit genocide and ethnocide to maintain the status quo.
Sources:
Department of Home Affairs, Adequate health insurance for visa holders — Visa Condition 8501. Available at: immi.homeaffairs.gov.au
The Treasury (Australian Government), The Lifetime Fiscal Impact of the Australian Permanent Migration Program, December 2021. Available at: treasury.gov.au. Also cited in Business Council of Australia, Migration Makes Australia Stronger, November 2024.
Services Australia, Newly Arrived Resident's Waiting Period (NARWP). Last updated December 2025. Available at: servicesaustralia.gov.au
Productivity Commission, Migrant Intake into Australia, Inquiry Report, April 2016. Modelling cited in BCA, Migration Makes Australia Stronger, November 2024. Available at: pc.gov.au
Centre for Population / OECD, OECD Findings on the Effects of Migration on Australia's Economy, 2023–2024. Available at: population.gov.au
International Monetary Fund, Australia — Macroeconomic Impact of Migration, IMF Country Report No. 24/12, December 2023. Available at: imf.org
Australian Taxation Office, Medicare Levy Exemption — Not Entitled to Medicare Benefits. Available at: ato.gov.au
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