By reinstating the Skilled Migrant Category (SMC) last week, New Zealand is signaling that they are starting to come back into play with other countries in terms of attracting highly skilled migrants. The reopening of the Parent Residence Category will help to facilitate this outcome by giving parents the option of migrating with their children. However, it is unclear whether or not this will be a reliable pathway for all families seeking to migrate.
The Past
The Category was closed in 2016 after a policy decision. Data from Australia showed that a similar policy led to significant financial losses for the government when considering parents’ tax contributions against their medical treatment needs. This simple analysis suggested that each parent cost the country around AUD400,000.Even though the benefits were not taken into consideration, such as childcare for working parents and long-term outcomes for migrant families, enough fear was created that a more in-depth review is now needed.
It is no surprise that this “can” has been pushed aside for so long, considering how daunting the task is. With a pandemic thrown into the mix, it’s easy to see why over five years have passed without any real action being taken.
While INZ is trying to make this Category reopening look more appealing than the last one, we don’t think the differences are significant. It’s still a positive that they have such a policy in place though, because it suggests they’ve looked at the benefits parents can provide as part of a bigger picture. Some benefits for highly skilled migrants include being able to settle down and contribute productively (over the long term) to a level that covers the costs of their parents’ health treatment. If these migrant parents did not pay taxes in the country where they need Healthcare, then the jurisdiction absorbing those expenses would still be covered.
What has Changed
The number of visas Immigration New Zealand (INZ) is granting under this Category has increased from 1,000 to 2,500 per annum. This may not seem like a large increase, but it is more than double the quota before the Category closed in 2016. And while the current quota still remains less than half of what it was originally set at 5,500 per year, it does show progress.
A more positive alteration is that the income requirements for sponsorship have decreased. Before, when the Category reopened in February 2020, one sponsor had to bring in twice the median salary to sponsor one parent. Now, however,The New Zealand median wage needs to be 1.5 times the current amount, with an extra increase of half the median wage for each additional person being sponsored.
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A new, innovative addition allows two adult children to now jointly sponsor their parents instead of just the child and partner combination used in all previous policies. Having joint sponsors is reasonably priced, although you cannot mix and match sponsors. This means that:
- you can sponsor the parent yourself;
- you and your partner can sponsor; or
- you and your sibling who also has a parent included in the application can elect to be sponsors.
You can sponsor two parents (a couple) if they have a biological or step sibling who is also included in the application, provided that this sponsors meets all requirements. Note that sponsoring siblings must be adults, and they too must meet the sponsorship requirements (i.e., being a New Zealand citizen or resident here for at least three years).
All Expressions of Interest (EOI) that are currently in the selection pool, as well as new EOIs submitted after 12 October 2022, will be affected by these changes.
Another change that will have a significant impact is how Expressions of Interest (EOI) will be selected from the pool. Previously, EOIs were chosen based on chronological order (the date they were entered into the pool.). If you submitted your EOI before October 12th, 2022, then this method will apply to you.
After that date however, things will work differently through a random ballot system. While this may be more fair for those wanting to apply in the future, it’s likely quite frustrating for people who have been waiting years already–as 20% of those selected and invited to apply from the pool under the new system won’t have waited nearly as long as others.
Although we have Made Progress, There are Still Technical Difficulties that Need to be Addressed.
Although INZ has made significant changes to this recently reopened category, many aspects remain the same-including the difficulty that low-income parents with children residing in New Zealand face in meeting the requirements.
The kinks have been ironed out from the last version, and it’s exactly how everyone would have wanted it to be. The only potential drawback is that sponsors may have to choose one parent to sponsor if they can’t reach the necessary amount for both, which might be tough.
If sponsors want to cover more than one parent, they’ll need an extra half the median wage per each additional person. A couple or two siblings sponsoring all four parents would need a yearly income of NZD$202,092.80 starting in January 2022.
Sponsors will need to show tax statements from the IRD as proof that they made at least two of the three income years immediately before submitting their application. In other words, it is not just the current income when they submit their EOI.
Unfortunately, sometimes life changes occur after an Expression of Interest is selected from the pool and before an application can be made. If this happens, it’s important to make sure that the applicant’s income still meets the median rate requirement.
Conclusion
The return of this Category will be a sign of relief for many migrant families who have been in limbo, trying to settle their parents here, for years. If you were already in the expression of interest pool before October 12, you now have more clarity and an estimate on how long it will take to complete your application if selected.
You may be interested to know that applications submitted in either year one, two or three post reopening are still being accepted.
Furthermore, every year 500 new EOI participants will win the “Parent Bingo” – even though it may seem like a low number at first glance, We believe that the number of people who will be able to qualify post-backlog clearing is reasonable, Therefore, it could possibly help draw in migrants who possess highly-sought skills.