On Friday, Greg Barns suggested that Afghan, Iraqi and Sri Lankan asylum seekers are “critical to economic growth” in the fruit-growing areas of the Riverina, Murray Valley and Goulburn Valley. Barns cites a National Farmers Federation submission reporting a shortfall of about 100,000 additional employees in the rural sector.

This should mean plenty of opportunities for the Pacific Seasonal Workers Pilot Scheme, announced by Prime Minister Kevin Rudd at the 2008 Pacific Islands Forum in Niue. The Prime Minister stated that 2500 workers would be recruited from the Pacific islands in 2009-11, to work for up to seven months in Australia’s horticulture industry.

But since the pilot program began, only 56 workers have come from the Pacific to take up seasonal work in Australian orchards and vineyards.

More workers are scheduled to arrive this summer under phase 2 of the pilot, but nowhere near the numbers seen in New Zealand under a similar scheme, which began in 2007. Nearly 4000 seasonal workers from the Pacific arrived in New Zealand in the first year of their Recognised Seasonal Employer (RSE) program, with more than 5000 in the second year.

So what’s gone wrong with the Australian pilot?

One problem is that the issue of labour mobility is entangled with the negotiation of a regional free-trade agreement, known as PACER-Plus. Trade ministers from around the Pacific met in Brisbane last week to map out a timetable for these negotiations. But island governments insist that increased labour mobility is integral to any trade deal. As well as existing opportunities for skilled professionals and trades people, Pacific nations want greater access to the Australian labour market for workers whose main skill is farming or fishing.

Remittances from overseas workers are already a crucial source of revenue for many island states (for example, Fiji earns more from remittances than either sugar or garment exports, and until the recent recession, remittances made up a third of Tonga’s GDP). Under a more liberalised trade and investment regime, the importance of remittances will grow. Island governments hope offshore workers’ wages will help to compensate for revenue lost as import tariffs are removed under the PACER-Plus agreement and overseas employment can replace jobs shed by industries that are currently subsidised or protected.

This debate comes at a time when there has been a structural shift in the Australian economy, with increasing use of temporary labour in a range of industries. There are more than  320,000 overseas students in Australia who can work up to 20 hours a week in term time and full-time in semester breaks; more than 130,000 skilled workers under section 457 visas, and 90,000 people under the working-holiday scheme.

Against those figures, the 56 Pacific workers who’ve taken up section 416 visas through the seasonal workers pilot are hardly the flood who would “take Aussie jobs”, as critics of the scheme predicted.

There are other reasons for the limited numbers of workers who’ve arrived.

The August 2008 announcement of the pilot left little time for the scheme to be in place before the peak harvest season last summer. Agreements were quickly signed with three of the four countries involved in the pilot (Kiribati, Tonga and Vanuatu), but these governments were already participating in New Zealand’s RSE scheme and had systems in place for the recruitment of workers. Finalising a Memorandum of Understanding with Papua New Guinea — the fourth country in the Australian pilot — has taken much longer (our northern neighbour has a larger range of players at national and provincial level who must be consulted and involved).

There have also been disputes over the best model for recruitment and employment. Under New Zealand’s RSE scheme, growers act as the direct employer of the overseas workers; in Australia, a different model has been adopted, with labour hire companies playing a greater role. At a time of recession and debate over the award covering the horticulture sector, many growers are reluctant to pay the extra premium required to cover the travel and administration costs of bringing in temporary workers from the Pacific.

Seasonal labour schemes are promoted as a win-win-win for employers, workers and government: growers gain a reliable but temporary labour force at peak harvest time; rural villagers from the Pacific have access to jobs at higher wage rates available at home; and government creates a regulated scheme that controls overstaying by temporary workers and starts to address the use of undocumented workers in an industry that relies on casual labour and off the books payments.

But there is a structural imbalance between the power of the host employer and the overseas worker. Several growers in Australia continue to employ overseas workers illegally. The Age’s recent exposé on undocumented Asian workers in the horticulture industry highlights the danger of employers using overseas workers to attack rights protected by the Australian union movement.

Any scheme recruiting seasonal workers must be well regulated with involvement of government, employers and unions, to ensure that core rights are maintained (on wages, working conditions, housing and health and safety laws). There is a need for extensive labour market testing and monitoring of social impacts, so the benefits of remittances for the family and community can be weighed against the social costs for  local and overseas workers.

Even if trade liberalisation eventually produces the economic nirvana in the Pacific that free-market economists predict (which is very doubtful, given the size of most island nations), there will be a lag before new jobs become available.

Under the pilot, Australia has only offered 2500 visas for the Pacific over three years, which is not a major test of systems for recruitment, housing and employment rights (in contrast, New Zealand has increased the cap for numbers from 5000 to 8000 workers every year in their RSE scheme). If the Rudd government is serious about regional economic integration, it must address the link between labour mobility and development in the islands region, and not just use greater labour market access as a bargaining chip in regional trade negotiations.

Nic Maclellan works as a journalist in the Pacific, and is author of Workers for all seasons? (Institute for Social Research, Swinburne University).