Coalition MPs concede immigration pledge not fully costed by independent watchdog

The policy, announced on Tuesday, would reduce net overseas migration to 100,000 for two years, then to 130,000 in the third year and 160,000 in the fourth. Taylor and Deputy Liberal leader Jane Hume have said the Coalition "worked closely" with the PBO on the plan, but Coalition sources told Guardian Australia the independent budget watchdog had not conducted a full analysis of the new policy before its release.

Taylor's office said they planned to have the policy costed before the next federal election, using internal analysis and existing costings during the design process. A policy document said the Coalition had worked with the PBO to assess "the impact of the package on the budget," finding it would generate a small positive return.

Challenged over the release of PBO costings on Wednesday, Taylor told Channel Nine: "We've released the outcomes of that budget analysis that we've been doing." The PBO declined to comment on Wednesday. PBO officials are not allowed to discuss costings for members of parliament but can choose to clarify references in media reports if they are incorrect or misrepresent PBO work.

Business and the university sector have warned the cuts are arbitrary, dangerous for the economy and likely to exacerbate shortages in key sectors, including health and aged care. Labor and One Nation both want to bring down international arrivals, seeking to capitalise on growing anti-migration sentiment and pressure on housing and essential services.

Analysis

Why This Matters

The Coalition’s failure to have its signature immigration policy fully costed by the PBO raises questions about fiscal credibility ahead of the next federal election.
The policy’s impact on key sectors such as health, aged care, and universities could worsen workforce shortages, affecting service delivery and economic growth.
The plan risks breaching a free trade agreement with India, according to advocates, which could damage diplomatic and trade relations.

Background

The Coalition’s immigration policy proposes sharp cuts to net overseas migration, targeting 100,000 arrivals per year for two years, followed by gradual increases. The cuts come amid rising anti-migration sentiment and pressure on housing and essential services. However, business groups and universities have criticised the targets as arbitrary and potentially harmful to the economy. The PBO is the independent fiscal watchdog that provides costings to parliamentarians, but its officials are restricted in discussing their work publicly.

Key Perspectives

Coalition: Argues the policy is "budget neutral" and that they worked closely with the PBO during design, with plans to have it fully costed before the election. They accuse Labor of not releasing their own modelling. Business and university sector: Warn the cuts are arbitrary and dangerous, likely to exacerbate shortages in health, aged care, and other critical sectors. Critics/Skeptics: Note that the PBO has not conducted a full analysis, and that the policy risks breaching a free trade agreement with India. Some view the move as a political response to One Nation’s growing influence.

What to Watch

Whether the PBO issues a clarification or correction on the Coalition’s claims about its work.
The release of a full PBO costing before the next federal election.
Labor and One Nation’s policy responses, and how the debate affects migration numbers and sector workforce pressures.

Analysis

Why This Matters

Background

Key Perspectives

What to Watch

Sources