In an attempt to address labor shortages in regional and remote areas, the Australian government is considering revising a free trade deal with the United Kingdom. This move aims to encourage more British backpackers to work outside bustling cities like Sydney and instead, head towards rural regions. The current agreement, which took effect in mid-2023, has led to an increase in the number of British backpackers in Australia, with over 77,000 visas issued in 2025-26, according to government data. This surge is partly due to the exemption from regional work requirements for those wanting to extend their stay beyond a year. However, the high concentration of British backpackers in cities has sparked concern among businesses in areas like Far North Queensland, who are struggling with labor shortages. Prime Minister Anthony Albanese met with his UK counterpart Andy Burnham last week, discussing potential changes to the rules regarding backpackers. The National Farmers Federation supports these discussions, but emphasizes that the issue of worker shortages is not limited to the UK deal alone. Wider proposals, including a possible overhaul of the working holiday visa system and cuts to net migration, are also under consideration.
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SUMMARY (CONT'D):
The increased presence of British backpackers in urban areas has impacted businesses heavily reliant on temporary labor, such as restaurants and tourist hotspots. For instance, Mexicairns owner Peter McLeay reports a decline in the number of British backpackers seeking jobs in Cairns since the implementation of the free trade deal. Similarly, Dan McConnell, general manager of the Mad Monkey backpacker hostel chain, notes a significant drop in the number of British tourists at their Cairns accommodation, with French tourists now outnumbering them three to one. These trends have led businesses in regions like Far North Queensland to lobby for changes in the free trade deal.
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SUMMARY (CONT'D):
The Australian government is keen on revising the rules regarding regional work requirements for backpackers from the UK. While Prime Minister Albanese initially ruled out forcing British backpackers to do the same as other countries, he has recently indicated a change in stance under pressure from businesses and regional communities. Discussions about potential changes were held at a meeting of Commonwealth leaders, although no immediate announcement was made. The government is now working on these issues and is open to making adjustments if there are good policy reasons. The proposed changes could include introducing a ballot system for backpackers wanting to extend their stay in Australia, with caps on the number allowed for a second and third year. These plans are still out for consultation, but some visa applications have already seen slower processing rates or pauses from certain countries.