THE Abbott Government is considering a radical overhaul to the immigration system that would allow the richest foreigners to buy their way into Australia.

The Australian government’s independent advisory body, the Productivity Commission, is investigating a proposal that would make entry charges the “primary basis for selection of migrants”, after a request from Treasurer Joe Hockey.

This would mean that migrants would be chosen based on how much they could pay, rather than their work skills or family connections to Australia.

The commission’s issues paper discusses a variety of models, including scrapping immigration caps and allowing a price to dictate the size of the intake. An alternative model would make demand for entry determine the visa price.

“Charging for entry may also conflict with equity or fairness objectives,” the issues paper states.

“For example, under a charging regime, the family reunion intake would be determined by the willingness and capacity of the immigration (or their family in Australia) to pay the charge, rather than the period of separation of other individual circumstances of the potential immigrant.”

Liberal Democratic Party senator David Leyonhjelm has pushed this issue since he entered federal Parliament and he said the issues paper was a “good introduction to the subject”.

“The idea is, let’s stop choosing migrants based on all these sorts of qualitative criteria such as skills, family reunion or business-type categories and all the bureaucracy; and replace them with a tariff,” Senator Leyonhjelm told news.com.au.

He said there should be more than one price, depending on the type of migrant, and there should be a variety of ways to pay the fee, such as a loan.

Senator Leyonhjelm was not concerned that the system might favour the rich.

“Immigration is not a charity, and it’s not intended to help poor people. It’s intended to help Australia’s economy,” he said.

“Rich people don’t have a reason to come to Australia; it’s the ones who are aspirational, the ones who would like to be rich, who might say ‘Can I be more successful if I pay $50,000 to come to Australia?’”

Senator Leyonhjelm also said the fee could help deter asylum seekers from entering Australia by boat. He said asylum seekers could pay as much as $40,000 in fees and bribes to make the treacherous journey to Australia, and a $50,000 visa fee could make a more attractive, legal avenue.

“The logic would be you would pay more than to come by boat but you wouldn’t have the indignity of the journey, you wouldn’t have to stay in a detention centre and you would have the certainty,” he said.

Migrants who can pay the entry fees would have the right to work, but health, character and security requirements would be retained. The changes would also continue to limit successful applicants’ access to social security and subsidised education, housing and healthcare.

Fees already apply depending on what type of Australian visa foreigners seek. For example, skilled migrants pay a base application charge of $3520. In 2013-14, visa fees and fines added $1.7 billion to the federal Budget’s bottom line.

The Productivity Commission issues paper acknowledges concerns about the effect immigration can have on the wages of the existing Australian population.

“A common concern … is that by adding to the supply of labour, immigrants can reduce the wages of incumbent workers,” the paper states.

“However, there may also be circumstances where immigrants do not place downward pressure on wages. For example, if the immigrants addressed a skills shortage due to their professional attributes, they could complement the existing workforce and may increase the productivity, and hence wages, of the local population.”

The commission also notes the positive impact the proposal could have on the Budget.

Prime Minister Tony Abbott told reporters today that the proposals were unlikely to become government policy.

“The immigration policy of this government is fairly and squarely based on what is in the best interests of our country in accordance with the best values of this country,” he said.

The public can make submissions to the Productivity Commission by June 12, before the body releases draft recommendations to the government in mid-November.

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