5 points short: the ongoing capital investment scheme fiasco

- Posted in Australia by Laurenon 03 September 2008

When the Australian skilled migration scheme was re-vamped on September 1, 2007, the skilled Australia visa application process went through a number of changes. One of these was the removal of the capital investment scheme.

Prior to September 1, it was possible to gain an additional 5 points when applying for an Australian skilled visa, provided you were willing and able to deposit AU$100,000 in a nominated Australian bond for at least 12 months. While few could afford to deposit the AU$100,000 to take advantage of the capital investment scheme, it was still a route to migration for a number of applicants who relied on the additional 5 points to qualify for an Australian visa.

As part of the Australian General Skilled Migration changes, applications lodged after September 1, 2007 would not be entitled to utilise the capital investment scheme. We anticipated this, and did everything in our power to ensure clients with applications that relied on the additional points through the capital investment scheme had been lodged by this date.

However, following news reports that hundreds of visa applications had allegedly been part of a 'scam' regarding unauthorised loans being made to applicants using the capital investment scheme, DIAC advised that from November 30, 2007, no State or Territory Government would be actively participating in arrangements that allow the allocation of 5 bonus points to skilled visa applicants through the capital investment scheme.

Essentially, this meant that even if you had successfully lodged your Australian visa application before the scheme's removal, if you hadn't been invited to lodge a deposit by November 30, your investment would no longer be permitted and the points would not be awarded.

Despite continued promises that DIAC would be investigating and proposing a replacement for the capital investment scheme, there has been no decision made yet. A number of solutions have been proposed to DIAC, such as the reallocation of points through the IELTS test or the creation of a new bond scheme to allow clients to be granted the points they need to qualify. While neither of these have been taken on, some clients have found a pathway through certain states allowing applicants to switch their application to a state-sponsored visa application.

However, there remain a number of migration hopefuls without a clear end in sight. While we understand and support any cause to crack down on fraudulent applications, it will soon be a full year since these applicants were placed in their current situation, with no sign of relief on the horizon. It's unfortunate and frustrating that we've been put in this position, but we'll continue to lobby DIAC for a solution, and hope that one will come soon.

- Lauren Mennie is the Casework Department Manager for the Australian Visa Bureau.