Who benefits from Australia’s Pacific labour scheme?

15 February 2023
Vinil Kumar

Days after winning office, Foreign Minister Penny Wong pledged to the Pacific Islands Forum that the Labor government would expand the Pacific Australia Labour Mobility scheme (PALM). In January, Prime Minister Anthony Albanese backed the Papua New Guinea government’s ambition to have 8,000 workers participate.

The scheme allows Australian bosses in agriculture, meat processing, fisheries, hospitality and aged care to recruit workers from nine Pacific countries and Timor-Leste for seasonal work or long-term engagements up to four years. Workers are recruited in their home countries, with employers covering their relocation costs. These costs, as well as employer-provided accommodation, transport and other living expenses, are then paid off by workers through payroll deductions. The scheme is promoted as helping 35,000 participants send money back home while also benefiting the Australian economy.

But scandals in recent years have exposed the cruel reality of the scheme—even the conservative National party Senator Matt Canavan described it as a form of indentured labour.

The scheme ties workers to the employer who sponsors them. Their ability to remain in the country depends on their ongoing employment in that workplace, giving bosses enormous power to compel them to accept degrading conditions.

In early 2022, the Sydney Morning Herald reported that a number of workers had their visas cancelled by the Department of Home Affairs after they left Regional Workforce Management, a supplier of Pacific labour to employers in agriculture and the meat industry. Workers had complained that they were denied medical treatment, were forced into unsafe workplaces and accommodation, and that employer deductions left some with pay rates as little as $9 an hour. In a 2016 ABC News investigation, one Tongan worker farm worker said he made just $9.96 in a week.

There have been many complaints of compromised workplace safety. In one instance, an abattoir worker lost an eye, according to a report from the Australian Meat Industry Employees union. In November 2021, the Guardian reported that 30 workers engaged through Pacific labour schemes had died in the last decade.

The Labor government recently announced that PALM workers on one- to four-year placements will be able to bring their families with them. While this offers some comfort to workers, it will be organised through the same restrictive mechanisms of the labour scheme. Family relocation will be at the discretion of the employer, their ability to remain in the country will depend on the worker’s continued employment, and workers will be responsible for their family’s relocation and living expenses. This includes private health insurance because their families will not be able to access Medicare. One Fijian couple employed under the scheme were left with $6,000 in medical bills after they had a child. The rising cost of living and the housing crisis will make it practically impossible for large families to move here.

The extension of the scheme has been marketed as a contribution to easing current labour shortages, particularly in agriculture. But it does so by providing Australian businesses with a pool of cheap and highly exploited labour.

It also helps put the Australian government on a better footing in its regional imperial competition with China. The Morrison government was criticised by foreign policy commentators for neglecting relationships with Pacific governments. Since coming to office, Labor has made efforts to rebuild them. Pacific governments support the scheme and have lobbied for its extension. They get to present themselves as having secured a path to employment that can offer their poor constituencies some hope for a better life.

The exploitative and restrictive nature of the PALM scheme is no accident or oversight, but the entire point of it. The more workers are worried that being sacked means uprooting their families and not being able to support family back home, the easier it will be for bosses to force them to work longer and harder for less pay. Fear of reprisals can also discourage workers from unionising to challenge these conditions.

In industries (like fruit-picking) that are particularly reliant on this form of labour, the wages and conditions of all workers in the industry can be driven down if unions are weak. Standards set in these industries can have knock-on effects to similar sections of the economy.

Expanding the current Pacific labour scheme will allow bosses to reap larger profits, while exposing more workers to dangerous conditions and a precarious existence.

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