2026-27 Federal Budget: what changed for Australian migration

The 2026-27 Federal Budget was handed down on the evening of Tuesday 12 May 2026. For people applying for an Australian visa, or about to, the migration measures matter for three reasons. The permanent migration ceiling has been held at 185,000 for a third year running. The share of places reserved for people already in Australia has continued to climb. And the government has flagged the first serious rewrite of the skilled points test in fourteen years, with consultation opening next month.

None of those changes alter the visa rules that take effect tonight. Most of what was announced is structural: where the program is heading, who it is designed to favour, and how the next round of policy will be built. Below is a plain-English walkthrough of the migration measures, what they say, and what they practically mean for applicants in each pathway.

What is in the 2026-27 Migration Program

The 2026-27 permanent Migration Program is set at 185,000 places, the same level as 2024-25 and 2025-26. The Skill stream takes 132,240 places (over 70% of the total), the Special Eligibility stream takes 300 places, and the remainder sits in Family.

The headline planning numbers from Budget Paper No. 2 are:

• Total program: 185,000 places
• Skill stream: 132,240 places
• Special Eligibility: 300 places
• Onshore allocation (Skill + Family combined): 129,590 places
• Offshore allocation: 55,110 places, "predominantly high-skilled"

Holding the ceiling flat is itself a signal. The budget papers describe the program as being designed to "place downward pressure on net overseas migration", and the Treasurer's speech repeated that framing. The composition has shifted, but the headline number has not.

The Family stream sub-allocation (Partner, Parent, Child, Other Family) has not yet been published, so we are not going to guess at the split. Same for the Skill stream sub-categories (189, 190, 491, 186, 482 and so on). Once the Department publishes the breakdown, that detail will sit on the Department's own migration program page.

How does the onshore tilt affect my application?

Roughly 70% of all permanent places (129,590 of 185,000) are reserved for people already in Australia, across both Skill and Family streams. Offshore applicants share the remaining 55,110 places, which the budget describes as "predominantly high-skilled".

In plain English, an applicant already in Australia on a substantive visa (a 482, a 500, a 485, a 417 or 462, a 820, and so on) sits inside the cohort the program is actively trying to convert into permanent residents. An applicant living overseas without an Australian foothold is competing for a much smaller slice.

A few practical implications follow directly from the allocation, without any speculation:

• Onshore partner applicants (820/801) generally sit in a stronger processing position than offshore (309/100) for the year ahead. The program is structurally weighted toward onshore conversions.
• The 482 to 186 transition (employer-sponsored work visa to permanent ENS) falls inside the favoured onshore cohort. Sponsors and candidates in that pipeline are in the part of the program the budget has explicitly prioritised.
• Offshore skilled and family applicants are competing in a tighter offshore pool. That does not mean offshore pathways are closed; it means selection will be sharper.

A new points test for skilled migration is coming

The budget confirms a full redesign of the skilled migration points test, the first major rewrite since 2012. The stated aim is to "select better educated, higher-skilled, and younger migrants overall". The timeline runs from a consultation paper in June 2026 to a legislative instrument by December 2026, with transitional arrangements to honour invitations already issued.

The points test sits at the heart of the 189 (Skilled Independent), 190 (Skilled Nominated), and 491 (Skilled Work Regional) pathways. Almost two-thirds of permanent skilled migrants are currently selected through points-tested visas, so a redesigned test is one of the more consequential migration changes in recent years.

What the budget tells us:

• Direction: Higher weighting on younger, better-educated, higher-skilled migrants. The detail of how those factors will be scored is the subject of the June 2026 consultation paper.
• Timeline: June 2026 consultation paper, with a legislative instrument expected by December 2026.
• Transition: Existing invitations will be honoured under transitional arrangements. The budget papers do not say what happens to existing Expressions of Interest in the pool that have not yet received an invitation; that is a typical consultation question.
• Pathways affected: 189, 190, and 491.

A few things the budget does not say, and that you should treat with caution if you see them claimed elsewhere: it does not say the 189 program is being expanded, it does not commit to a specific points threshold, and it does not name occupation lists that will rise or fall in priority. The consultation paper is where those details will be debated.

Working Holiday Maker: wider use of ballots

The budget signals an expansion in the use of ballots for the Working Holiday Maker program (subclasses 417 and 462), with the stated goals of managing program numbers, reducing barriers to work, providing fairer allocation, and supporting national interests.

Ballots already apply to several 462 partner countries where demand significantly outstrips the annual cap. The budget does not name new countries; it signals that the ballot mechanism will be used more widely. The detail of which programs move to a ballot, and when, will sit with the Department's WHM program settings rather than budget night announcements.

Two honest notes for applicants:

• If you are from a country whose WHM program is already balloted, your route into the program is the official Home Affairs ballot. Tern does not lodge Working Holiday Maker applications for ballot-status countries (currently India for 462, China for 462, and Vietnam for 462). You apply directly through Home Affairs once your ballot result is confirmed. We will not pretend otherwise.
• If wider ballot expansion happens during 2026-27, the same constraint will apply to any newly balloted country. We will adjust our supported countries list rather than try to lodge applications through a system that does not allow them.

If you are from a non-ballot WHM country and your visa is straightforward, the application itself has not changed in this budget. Fees and eligibility rules remain as they were going into the budget.

$85.2 million for faster skills assessments

The budget allocates $85.2 million over four years to the Department of Employment and Workplace Relations to modernise the skills assessment system, with most of the money flowing to Trades Recognition Australia. For applicants in trades occupations, this is one of the most directly useful measures in the budget.

The breakdown:

• $75.1 million over 4 years for Trades Recognition Australia to deliver a modern skills assessment system, including a pilot for electrician and plumber licensing pathways in partnership with states and territories. This funding is cost-recovered.
• $5.6 million over 3 years for TRA to deliver onshore skills assessments for visa holders.
• $4.5 million over 4 years for regulatory oversight of Assessing Authorities, including annual Assessing Authority Performance Reports from 2027.

Why this matters for visa applicants: trade occupations applying for the 482, 186, 189, or 190 commonly need a positive skills assessment from TRA before they can be invited or nominated. TRA assessments have historically been one of the slowest steps in the pipeline, and they sit outside the Department of Home Affairs entirely. Faster, more transparent assessments cut a real bottleneck.

The annual performance reports from 2027 are also worth flagging. Assessing Authorities (TRA, VETASSESS, Engineers Australia, CPA Australia, and others) have not previously been subject to a published performance regime. Once reports are published, applicants will have data to compare expected timelines across authorities, rather than guessing from forums.

What does the budget say about Net Overseas Migration?

Net Overseas Migration (NOM) is forecast at 260,000 in 2025-26, falling to 225,000 in 2026-27, then settling around a long-term anchor of 235,000. The budget describes its measures as placing "downward pressure" on NOM.

NOM is a different number from the permanent migration program. It counts everyone who arrives in Australia minus everyone who departs, across temporary and permanent visas combined. Students, working holiday makers, temporary skilled workers, partners on bridging visas, and permanent residents all sit inside the NOM figure.

In plain terms, the budget is forecasting a smaller temporary pipeline as a result of measures it is introducing or has already introduced (student integrity funding, English-test tightening, salary thresholds rising, ballot expansion, and so on). It is not forecasting cuts to the permanent program, which remains at 185,000.

For an individual applicant, NOM is a macro indicator. It does not change the rules for your visa subclass. What it tells you is the policy direction: the government is forecasting fewer net arrivals, achieved primarily through tighter temporary visa settings rather than headline cuts to permanent residency.

International students and the 295,000 cap

The National Planning Level for international student commencements has been lifted to 295,000 for 2026, up from 270,000 in 2025. Australian-schooled students, TAFE-pathway students, and pathway-provider students are excluded from the cap.

The student measures in this budget are mostly integrity and administrative rather than headline rule changes:

• National Planning Level: 295,000 student commencements in 2026 (excluding the categories above).
• $19.8 million over 4 years for student visa integrity, applied both onshore and offshore.
• University allocation increases are tied to engagement with Southeast Asia and to progress on student accommodation.

Student visa application fees (subclass 500) were not changed in this budget; the live fee remains as it sits in our visa catalog (currently AUD $2,000). The 485 Graduate visa fee doubled earlier this year (effective 1 March 2026) and was not adjusted again in this budget.

A related change worth noting, although it was not made in this budget: nine English-language tests are now approved for student visa applications, expanded from five by the Department of Home Affairs in August 2025. If you previously hit a logistics wall booking your IELTS or PTE in a particular country, the wider provider list is worth checking before you commit to a test date.

Employer sponsorship thresholds rise on 1 July 2026

From 1 July 2026, the Core Skills Income Threshold (CSIT) rises from $76,515 to $79,499 (an increase of 3.9%) and the Specialist Skills Income Threshold rises from $141,210 to $146,717. The Temporary Skilled Migration Income Threshold (TSMIT), which the regional 494 continues to use, is not automatically indexed and stays at $76,515 unless the Minister updates it by legislative instrument.

These thresholds matter because they set the minimum salary a sponsor must offer to nominate a candidate. The CSIT applies to the 482 Core Skills stream and to the 186 Employer Nomination Scheme. The Specialist Skills threshold applies to the 482 Specialist Skills stream. TSMIT continues to apply to the 494 Skilled Employer Sponsored Regional visa.

In practical terms:

• A 482 Core Skills nomination lodged on or after 1 July 2026 must meet the $79,499 threshold. A nomination lodged before 1 July uses the existing $76,515 threshold.
• A 482 Specialist Skills nomination lodged on or after 1 July 2026 must meet $146,717.
• A 494 regional nomination continues to use $76,515 unless the Minister signs a separate instrument to update TSMIT. With CSIT rising and TSMIT held flat, the regional pathway becomes meaningfully cheaper for sponsors to access, in salary terms, relative to the 482.

The change is automatic on lodgement date. Sponsors with nominations close to threshold should factor this into the lodgement timing for the next two months.

Migrant worker protections, refugees, and English support

Three smaller measures are worth covering briefly.

Migrant worker protections, $27.0 million over 2 years. Funded under the Department of Home Affairs to deliver education for migrants on workplace safeguards, protections, and migration-law compliance. The funding sits in the migrant-worker-protection space rather than visa processing, but it signals continued government focus on workplace exploitation.

Refugee, humanitarian and settlement. The total Refugee, Humanitarian and Settlement Migration envelope sits at $832.2 million in 2026-27, down slightly from $862.2 million in 2025-26. The Community Refugee Integration and Settlement Pilot (CRISP) receives $3.5 million over 3 years, with $1.2 million ongoing per year thereafter, to embed the program as a continuing pathway.

Adult Migrant English Program successor. The budget confirms a new, more flexible English language program for "those most in need", launching in 2029. The budget papers do not surface a specific 2026-27 funding figure for the successor program, and we are not going to invent one.

What about partner visas?

Partner visas (820/801 onshore and 309/100 offshore) did not get a dedicated line item in this budget. The most relevant change is structural: the 70% onshore allocation across the permanent program indirectly supports onshore partner applicants over offshore ones in processing terms.

If you are weighing the onshore vs offshore decision, the budget reinforces what was already true: the program structure favours processing onshore partner files. That said, the onshore vs offshore choice has always been driven primarily by where you can live during the wait, your visa status, work rights, and your evidence access, not by program ratios. Read our ultimate guide to the partner visa for the practical decision framework, and our after-you-lodge guide for what to do during the wait under the April 2026 Department update.

What did not change in the budget: partner visa application fees, the evidence categories the Department assesses, the two-year permanent stage process, or the genuine and continuing relationship test. Those are program rules, not program-size settings.

The 2026-27 Budget is more about direction than disruption. The program ceiling is unchanged, application fees are unchanged, and the day-to-day rules for most visa subclasses are unchanged tonight. What did change is the structural signal: more onshore, fewer offshore, a points test redesign coming, ballot expansion in Working Holiday, and a real funding commitment to faster skills assessments.

If you are weighing which pathway fits your situation, the budget reinforces decisions you may already have been making. Onshore over offshore where you have a real choice. Lodging under the current points test if you are already invitation-eligible. Lodging a 482 nomination before 1 July if you are close to the salary threshold. None of these are new ideas; the budget makes them more clearly the path of least resistance.

To explore options that fit your circumstances, start with our partner visa guide, our Working Holiday visa guide, or our employer-sponsored visa guide. If you already know where you are heading, you can begin an application directly from those pages.

Source: 2026-27 Budget Paper No. 2 (Budget Measures), Treasurer's Budget Speech, and Department of Home Affairs migration program statements, 12 May 2026.