Cheap imported labor is gravely undermining local wages in Australia"s ICT industry and contributing to high levels of unemployment among Australian IT graduates.

Such are the dire warnings of the latest Australian Computer Society (ACS) policy statement on immigration, which cautions that a lack of oversight of Australia"s skilled migration numbers by the Department of Immigration, Multiculturalism and Indigenous Affairs (DIMIA) is allowing widespread labor market abuses.

Released by ACS president Edward Mandla, the 17-page policy finds the government"s administration of migrants awarded entry into Australia based on their IT skills is severely lacking in transparency and argues Australia"s immigration processes need to become far more transparent.

While holding all the government"s IT related migration programs to account, the ACS paper is by far the most scathing about loopholes allowing abuses of visa sub-class 457, which allows skilled employees to be sponsored into jobs in Australia when an employer can demonstrate no suitably-skilled Australians can be found.

"The 457 program is currently being used to undercut prevailing market salary rates and displace young ICT professionals and provide unfair competitive advantages to offshoring firms competing against local firms, particularly in tendering for large projects," the report states.

The ACS policy statement also recommends the government institutes a "mandatory skills assessment for 457 s (or at least a verification process) to allow the skill set of 457 visa holders to be determined".

The ACS does not suggest how, or by whom such a process should be implemented.

Claiming that the current 457 scheme has "gone astray", the ACS also wants the government to collect and publish "regular data on the actual salaries paid to 457 visa holders compared to DIMIA-approved salaries".

The report also states that the government"s current visa programs in relation to IT have had a significant impact in fuelling high unemployment among ICT graduates, adding that migration currently accounts for 25 percent of IT jobs held by computing professionals under 30.

The government has continuously reiterated that the 457 scheme is not intended to give employers a green light to import skilled migrants into Australia in order to bypass paying local labor market rates.

In March IT Minister Senator Helen Coonan told Computerworld: "Clearly we wouldn"t want any abuses of the visa requirements, so I think it is something we have to be very careful about and have a look at."

A spokesman for Immigration Minister Amanda Vanstone, whose department was forwarded an advance copy of the ACS report, defended the current 457 visa process.

"All 457 applications must be nominated by an approved sponsor who must show benefit to Australia and demonstrate a willingness to comply with undertakings as a sponsor which are included in the migration regulations," the spokesman said.

Asked about whether such conditions addressed undercutting local wages, the spokesman said "meeting industrial laws" were part of the undertaking.

However, if any industrial awards currently exist for Australia"s ICT workers - who numbered 335,200 according to 2003/4 figures from the Australian Bureau of Statistics - a figure which excludes sales and marketing roles.

IT Minister Helen Coonan is currently travelling overseas.