Labor urged to keep ‘golden ticket’ investor visa primarily used by Chinese migrants

The Australia China Business Council has urged Labor to retain the "golden ticket" significant investor visa after the home affairs minister, Clare O'Neil, signalled it could be axed.

The council made the call in a submission to the home affairs department's migration review, which has also reignited debate between business and unions about the level of migration and raising the pay floor for temporary skilled migrants.

The Business Chamber of Australia has warned the promised rise in the pay floor should be phased in gradually and the Australian Chamber of Commerce and Industry wants only a "modest" rise to $60,000.

Before the jobs and skills summit, unions called for a pay floor of $91,000 to cut down on use of temporary labour, cautiously agreeing to an increase in permanent migration in return for more investment in training.

In September O'Neil signalled the significant investor visa - which allows foreign nationals to stay in Australia for up to five years if they invest at least $5m in approved investments - could be axed because it "isn't adding value to the country".

"It's actually costing us on average for every person because these are people who are generally coming in at quite a late stage of their life, often at the end of their business career, and coming to Australia, basically to settle down and retire," O'Neil reportedly told Sky News following the jobs and skills summit.

In 2016 the Productivity Commission recommended abolishing the visa, warning that investor visas are "prone to fraud".

In its submission, the Australia China Business Council (ACBC) defended the significant investor visa as an important measure to "drive innovation and contribute to Australia's economic growth by attracting investors who seek permanent residency" which it said contributes "significantly to employment in the economy".

The ACBC said a $5m investment could generate $250,000-$350,000 in taxable income each year, with many investing more than $5m and capital remaining in Australia "as part of generational wealth strategies".

It said a "perceived weaknesses" in the policy could be addressed by reforming the visa's rules to require more investment into venture capital or increasing the minimum stay requirement from 40 to 60 days a year.

Chinese nationals account for 85% of the 2,300 significant investor visas granted since 2012. The ACBC said the "number could be increased while maintaining the overall balance in the migration program".

Former immigration department secretary, Abul Rizvi, told Guardian Australia he favours abolishing the visa because "it's basically used as a retirement vehicle".

"We just don't get a good return on investment on it, if that's the objective."

The Albanese government has boosted the 2022-23 permanent migration intake from 160,000 to 195,000, but businesses are using the review to call for further measures to ease labour shortages.

On Monday, the Business Council of Australia released its submission to the review, calling for the migration level to be set as "a percentage of Australia's total population" with estimates provided four years in advance. That would "build on and grow" the expected intake, it said.

The Ai Group warned that increasing the pay floor - which has been frozen since 2013 at $53,900 - by the wage price index over that time would result in a pay floor of $63,000.

"Even this level is high and would rule out many trade-level occupations which have been shown to be experiencing some of the highest levels of skill shortage," it said.

The Australian Chamber of Commerce and Industry will release its submission on Tuesday, which Guardian Australia understands will call for a "modest" temporary skilled pay floor of $60,000.