New Zealanders in Australia are now getting visas previously granted to mostly overseas-based Asians.
Home Affairs Minister Peter Dutton is cutting the number of Asian immigrants allowed into Australia, to allow more New Zealanders to stay.
Traditionally, 44,000 places in Australia's skilled independent visa programme have gone to applicants who are mostly Asian and living overseas.
But now as many as 10,000 New Zealanders who are already living and working in Australia will be part of this annual allocation.
The change is a result of a decision by the government to merge a new Kiwi visa with the existing skilled independent program, without increasing the number of visas in the scheme.
The Department of Home Affairs said the new policy was directly aimed at New Zealand citizens who have been living in Australia for at least five years and are making an economic contribution to Australia.
Fewer overseas visa arrivals
The Department of Home Affairs confirmed to the ABC that New Zealanders receiving the new visa are already counted as residents, reducing the number of people coming to Australia as a result of the programme.
The new visa was announced in 2016 as an acknowledgement of "the special relationship between the two nations", according to a statement from the Prime Minister.
"The pathway is directly aimed at New Zealand citizens who have been living in Australia for at least five years and have made, and continue to make, a demonstrated economic contribution to Australia," a spokesperson for the department said.
The move will help slow the growth of migration by thousands each year - without changing the government's formal permanent intake.
Australia's headline migration figure is currently calculated by the Australian Bureau of Statistics as 250,000 and growing at 15 percent in the year to September.
Mr Dutton told journalists that Cabinet had discussed reducing migration, although the Prime Minister declared there had been no formal submission for a cut to Australia's permanent migration programme.
Treasurer Scott Morrison has previously said a cut to migration would hurt the economy.
From Asian migrants to the neighbourhood Kiwi
The tweak has also changed Australia's migration mix.
It has substituted the mostly skilled Asian workers living overseas with Kiwis already working in Australia.
The skilled independent visa - traditionally assessed on points based on a worker's experience - counts for approximately one quarter of Australia's permanent visa programme: a ceiling of 44,000 individuals each year.
Alongside the employer-sponsored programme, it is Australia's main source of skilled migrant workers.
Last year, three out of five successful applicants in the program were granted visas while living overseas.
In the first eight months of the scheme's operation, 9000 New Zealanders had applied for the new visa, according to the department.
Wayne Parcell, immigration partner at EY, said Australia could expect around 10,000 Kiwi applications this year and noted that these visas were not restricted to specific occupations.
"The criteria for the new visa would seem to have more to do with the context of the Australia-New Zealand relationship than a predetermined impact on the skill segment of the migration programme."
Points-based component shrinks
This influx of New Zealanders has coincided with a shrinking of the old points-based component.
There were 13,200 invitations to apply for one of these visas issued in 2017-18 by the end of February, down by almost 10,000 across the same period in the previous year.
The department spokesperson said invitation numbers "may vary depending on the number of applications currently being processed by the department".
Home Affairs Minister Peter Dutton said this week that he had been "very careful in working through the numbers".
"The idea of the migration programme in our country, as it was in the Howard government, as it was in the Abbott government, as it now is in the Turnbull government is to make sure we're bringing the right people in," he said.
"People who want to work, not be leading a life on welfare, people who want to integrate into our Australian society, people who want to abide by our values and our laws."
New visa proves popular
Between 60,000 and 80,000 Kiwis are eligible for the new visa, according to different estimates.
The visa requires an applicant to live in Australia for five years and maintain an income over $53,900.
At the end of February 1512 of the new visas had already been granted and around 7500 were still being processed.
Applications only opened in July, and the process typically takes at least three months.
The new permanent visa gives Kiwis access to more welfare services and, unlike the standard visa available to New Zealand visitors, provides a pathway to citizenship.