Australia’s controversial skilled migrant program has been “a wonderful success” that demands changes to the nation’s migrant settlement services program, according to Migration Council of Australia chairman Peter Scanlon.

Speaking at this month’s Federation of Ethnic Communities’ Councils of Australia (FECCA) 2013 Conference held on the Gold Coast, Mr Scanlon said skilled migration, and particularly temporary 457 visas, had become a dynamic economic and social force.

“We’ve seen fundamental changes in Australian immigration policy over the past 10 to 15 years and what we are moving towards is a demand driven model; the 457 visa arrangements are a wonderful example of the success of this model,” he said.

Mr Scanlon said that two thirds of Australia’s permanent intake of migrants was now through skilled migration programs where once it had been just a quarter.

“We’ve seen large growth in 457 visas to the point where we now have around 120,000 in 2013. That is just one per cent of the workforce but it counts because it is where we have skilled shortages,” he said.

Although the skilled migrant visa scheme was being scaled back by the previous federal government after allegations of rorting, Mr Scanlon said the program had developed a momentum of its own.

“What we have now is effectively a two-step immigration program because a large proportion of 457 visa holders are moving on to become permanent skilled migrants,” said Mr Scanlon, who also heads the Scanlon Foundation which promotes social cohesion.

“This is a good and efficient outcome because these people are already here. We know that 60 per cent of those who apply for 457 visas intent to apply for permanent visas in the future,” Mr Scanlon said.

“This is effectively linking the two parts of the skilled migration program – the permanent and temporary – so that now it is critical to them as one thing and to realise that this is of major economic benefit to Australia,” he said.

Mr Scanlon said the MCA’s recent survey work around the temporary skilled visa program found 88 per cent of employees and 85 per cent of employers either satisfied or very satisfied with the program.

But he said the program faced challenges and there was a need to be vigilant to guard against possible rorting or exploitation of workers.

“We need a better system of recognition of skills and qualifications and we need to keep watch on a rise in the reporting of instances of discrimination in the past 12 months.”

Mr Scanlon said the biggest challenge was the successful settlement of skilled migrants that ensured their skills stayed in Australia.

“Our settlement system hasn’t changes as our immigration programs have changed,” he said.

“The system does not recognise skilled migrants as in need of settlement services and maybe we need to rethink this.

“With advancing technology and air travel people are able to stay connected with their home countries much easier and they are able to go home more frequently.

“This risk is they will never engage and become integrated into the community if we don’t help them settle,” Mr Scanlon said.

He said 457 visa holders were not eligible for settlement support, Medicare or free education for their families.

“They are being treated by the system as temporary when the reality is they come here to stay.

He said employment outcomes for the partners of 457 visas were also lower that they should be.

“We need a reshaping of settlement services to put them in line with changing immigration processes and the need to be flexible and client based,” Mr Scanlon said.