In theory, Labour's policy of managing immigration seems eminently sensible. The party would, said David Cunliffe, aim for "a steady, predictable, moderate flow that's at a level that addresses skill shortages". In reality, however, such an approach is impractical. New Zealand has had enough experience with stop-go immigration policies to know that while it might be easy to turn off the tap, it can be extremely difficult to return the flow to the desired level.

The issue has leapt to prominence after Treasury figures in last week's Budget forecast annual net inward migration would peak at 38,000 this year, but could be as high as 41,500. This was accompanied by a warning that the rising numbers could further fuel the high cost of housing.

Labour says that threat could be defused by restricting the annual migrant intake to between 5000 and 15,000. It did not dwell on how that would affect the external perception of a policy that could no longer be said to be stable, sage or welcoming.

Perhaps the foremost flaw in Labour's approach is the considerable difficulty of tailoring immigration to skill shortages. The lag between a policy being announced, its implementation and its outcome is too great to guarantee anything approaching success.


Unexpected events, of whatever nature, can quickly render it foolish. Most importantly, the result can be an unnecessary shortage of skilled workers in a particular area when demand changes. They will have been lost to other countries.

Policies like this cannot be justified, even in fraught economic times, when they are underpinned by the fear of immigrants taking jobs. They make no sense at all when the economy is travelling well.

Additionally, Labour's policy is based on a false premise. The latest net migration statistics reflect not so much a flood of immigrants as far fewer people being lured across the Tasman, in particular, and an increasing number of New Zealanders returning from Australia. But the inflow of other migrants is at its highest level since 2003, when there was an influx of overseas students. New Zealand's welcoming demeanour and economic wellbeing have an obvious appeal.

That should be applauded, rather than being the catalyst for a misplaced resetting of immigration. Labour, especially, should recognise as much, after its stumbling when it was last in government. Most damagingly, it placed strict conditions on investor migrants in 2005, a move that succeeded only in driving would-be millionaire immigrants elsewhere. The policy was rescinded within a couple of years but it has taken far longer to repair the damage, not least to the country's image.

The Clark Government took that step in response to a wave of anti-immigration sentiment stirred up by Winston Peters. The New Zealand First leader is now beating a slightly different drum, suggesting that new immigrants should be sent to the regions for a minimum of five years to take pressure off Auckland. So dogmatic a policy would be equally counter-productive.

And it betrays a disregard for the important role immigrants have played since the turn of the century. If not for them, the economy would have been less resilient and the population would have been largely static.

The ideal setting for population growth is when the economy is doing well in comparison to similar economies. That is the position now. The woes of Australia, the United States and Europe provide an opportunity that should not be passed up - certainly not for a policy that pulls away on the welcome mat for all the wrong reasons.

Debate on this article is now closed.