The Government could lose millions in revenue a year as it grants longer visas and temporarily drops the fees for those from Pacific nations.
From next week, the cost for visitors from the Pacific to get a visa is decreasing from $216 to $161, in a move Foreign Minister Winston Peters said will “deepen Pacific connections”.
Fees will drop for a 12-month period. No further decisions have been made beyond that timeframe.
Separately, since last July, people from nations in the Pacific Islands Forum get a default two-year multi-entry visa for New Zealand, which increased from one year. This change is not temporary.
A proactively-released report prepared by officials from the Ministry of Business, Innovation, and Employment estimates the timeframe adjustment would decrease revenue by approximately $1-2 million per annum.
It suggested the change would increase “existing pressure on the immigration funding system,” as fixed costs would need to be spread across fewer fee payers.
The report also explored the option of halving the fee to $108, something the Government did not decide to do.
“As an example, a 50% subsidy on visa application fees would cost approximately $4.5 million per year. An estimate of eight additional processing staff would be required to improve processing speed, with an initial estimated cost of up to $1 million per annum.”
Fees were not halved, they were instead reduced by around 25%. Officials did not estimate the revenue impact from the agreed-to drop in fees.
They added further fee subsidies may require new Crown funding, if funding could not be reprioritised from the Budget’s foreign affairs allocation.
Two other options were listed in the document as improving visa offerings and travel facilitation but were redacted.
In a statement, the Ministry of Foreign Affairs and Trade said the immigration system is predominantly funded by fees and levies paid by visa applicants.
“A modest revenue impact is expected and will be managed through a transfer of funding from Vote Foreign Affairs - [the foreign affairs aspect of the Budget] - reflecting the benefits of stronger regional engagement and easier travel for Pacific communities,” the agency said.
An impact analysis prepared for the policy said reducing visa fees for Pacific nationals would benefit the Pacific community.
Officials said New Zealand’s people, economy, and environment are closely linked to the wider Pacific countries, and noted New Zealand has had a long history of migration from the Pacific.
“New Zealand is also home to more than 381,600 Pacific peoples, who often maintain a strong connection with their families back in their respective Pacific home countries,” the impact analysis said.
People visiting from the following Pacific nations will have reduced visitor visa fees from June 1 this year:
- American Samoa
- the Federated States of Micronesia
- Fiji
- Kiribati
- Nauru
- Palau
- Papua New Guinea
- Republic of the Marshall Islands
- Samoa, Solomon Islands
- Tonga
- Tuvalu
- Vanuatu
People from the Cook Islands, Niue, and Tokelau do not need visas for New Zealand.
Immigration New Zealand has said the 12-month fee drop will help understand the impact on travel patterns, demand, costs, and immigration operations - to “help inform any long-term decisions”.
In March this year, Winston Peters accepted a petition calling for visa-free travel for Pacific citizens.
Azaria Howell is a multimedia reporter working from Parliament’s press gallery. She joined NZME in 2022 and became a Newstalk ZB political reporter in late 2024, with a keen interest in public service agency reform and government spending.
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