Reason record numbers of migrants are flooding into Australia is exposed by top government official

One of Australia's most powerful public servants has used predictions about an ageing population and a falling birth rate to justify record-high immigration.

Steven Kennedy, the secretary of the Treasury who also sits on the Reserve Bank board, slammed the notion a rapidly ageing population would be temporary.

'There is sometimes a perception that the ageing of population is a temporary phenomenon particularly as the baby boomers age,' he told the Committee for Economic Development of Australia think tank on Monday.

'However, this is not the case.'

Dr Kennedy quoted from Treasury's Intergenerational Report predicting the proportion of people aged 65 and over would climb to 23.4 per cent by 2062-63, up from 17.3 per cent during the last financial year.

The share of those aged 85 and over was predicted to surge to five per cent, up from 2.9 per cent.

This is occurring as Australia's fertility rate falls, where couples are on average having less than two children, or below replacement level.

'So long as the fertility rate is below replacement, successive generations will be smaller,' Dr Kennedy said.

Australia's cost of living crisis is set to worsen as the terrorist attacks on Israel push up crude oil prices - potentially sparking another rate rise with the local currency at the weakest level in a year.

Australia's fertility rate has been below 2.1 since the 1970s, with the 1.98 level of  2008-09 a temporary high point in recent years.

Higher immigration over recent decades has failed to stop Australia's population getting older, with Treasury's Centre for Population calculating the nation had a median age of 38 years and six months in mid-2022, up from 32 years and eight months three decades earlier.

Nonetheless, Dr Kennedy said Australia's population would be even older without the immigration surge of the past two decades.

'Higher migration has been the primary driver of the larger and younger population,' he said. 'Our population growth has been higher than all the G7 nations reflecting higher migration.'

A record 454,400 migrants moved to Australia in the year to March, with this figure including both the permanent intake of skilled migrants and long-term international students.

Australia's net overseas migration rate, based on arrivals minus permanent departures, is quadruple the 110,104 level of two decades ago.

An immigration surge, to make up for Australia's border closure in 2020 and 2021, has also coincided with a productivity plunge, where output for every worker is falling.

Productivity, based on gross domestic product per hour, fell by 3.6 per cent in 2022-23.

During the past decade, when 200,000 migrants have been moving to Australia a year, productivity growth has been stuck below one per cent.

This is a far cry from the two per cent pace of the 1990s, when annual immigration was mainly below 100,000.

But Dr Kennedy said an ageing population would mean weaker-than-average economic growth in decades to come.

'The lower growth reflects slower productivity and population growth, and reduced participation due to ageing,' he said.

'Projected slower productivity, population growth and lower participation is not unique to Australia. 'These outcomes are anticipated for most developed countries.'

Australia's population grew by 2.2 per cent in the year to March with immigration making up 80.7 per cent of the increase.

But Treasury is expecting that to slow to 1.1 per cent over the next 40 years, putting it below the 1.4 per cent level of the past four decades, as Australia's population grows from 26.5million to 40.5million by 2062–‍63.

Treasury advocates higher immigration so it can reap more taxation revenue.

The Business Council of Australia, which represents big corporations, has lobbied for higher immigration since the borders were reopened in late 2021.

https://www.dailymail.co.uk/news/article-12612523/Reason-record-numbers-migrants-flooding-Australia-exposed-government-official.htmls

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