Government reviewing Working Holiday Maker program

Labour and competition policy are the biggest challenges facing the horticulture sector. 

The federal government continues to review its immigration policy, which could have major ramifications on how the horticulture sector sources labour. 

The major worry is that the government is considering the requirement for backpackers to work in regional areas to extend their visas. Backpackers are a hugely important part of the labour pool, with estimates that they provide up to 50 per cent of the workforce during harvest.  

The constant changes to labour policy over the last few years continue to frustrate growers. Think of changes to overtime, piece rates, the on-again/off-again Ag Visa, the removal of the requirement for UK backpackers to work in regional areas, and increased Pacific Australia Labour Mobility (PALM) scheme bureaucracy. They have already added significant costs to growers who are already finding it near impossible to pass on legitimate costs to the out-of-control retail duopoly. 

While the federal government has flagged it will “not limit the Working Holiday visa to one year, in recognition this would significantly damage local economies in regional Australia”, it has also left the door wide open to many other possible outcomes. 

As mentioned, the biggest is the removal of the requirement for backpackers from the UK to work in regional areas. If removed, there would be very little incentive for those backpackers to travel to regional areas. The other concern is that the government will introduce significant administration and cost burdens, similar to the recently revised PALM scheme. These potential changes are being promoted based on protecting backpackers from being exploited.  

Significant steps have already been taken to reduce exploitation, particularly the requirement for backpackers to get the grower to sign off on their 88 days of work. This requirement for sign-off allowed a point of leverage for unscrupulous growers. Also, the introduction of the minimum wage under the piece rate makes it a lot clearer to backpackers what they should be paid.  

Going forward, the horticulture sector and APAL have been advocating for the introduction of a national labour hire licencing scheme, with a well-resourced enforcement regime, as well as establishing a public register of all businesses prohibited from employing backpackers, as a way of minimising exploitation. 

While every measure needs to be taken to protect workers, there is a very real need to ensure any measures are not excessive or bureaucratic. As an example of over-reach, growers are flagging that hourly costs for the PALM scheme are heading towards $45 per hour. 

The government should be considering all options to reduce the costs for growers, not to increase them. The sector needs more cost-effective labour flexibility – not less. We need to be supporting the backpacker scheme and expanded PALM scheme, as well as a new harvest visa.  

History of the Working Holiday Maker (WHM) program

• Introduced in 1975. 

• Expanded in 2005 to allow participants to apply for a second year by completing three months of work in regional Australia. 

• In 2019, it was expanded again to a third year. Backpackers now had to work an additional six months in their second year to gain a third year. 

• The type of work and locations have broadened over time. Initially focused on agriculture, forestry and fishing, it now includes other industries like construction and tourism. 

• On 1 July 2024, UK backpackers were exempted from the regional work requirement due a bilateral trade agreement between the UK and Australia. 

• In 2024, the federal government reviewed its migration policy, with a recommendation of returning the WHM to its original intent of a cultural exchange program. This could remove the need for backpackers to work in regional areas. 

This article was published in the Spring 2024 edition of AFG.