The Coalition has accused Labor of exploiting a $171 million multicultural fund to bankroll its own seats and entrench “ghettoisation” of migrant communities, as the Albanese government quietly shifts funding toward cross-cultural programs over narrower ethnic or religious activities.
A clash over border controls and diversity, fed by rising support for One Nation, will heat up this fortnight as parliament resumes and Prime Minister Anthony Albanese tries to balance support for migrant communities with public demands to tighten migration.
After abruptly delaying the announcement of a migration overhaul last week, Home Affairs Minister Tony Burke is expected to provide more detail in coming days, on a package of new measures to cut the net overseas migration intake to its budget forecast of 225,000 per year.
Nine months after the Bondi massacre enlivened debate over social cohesion, Labor is toying with proposals to rework the skills program to better serve the economy, put stricter rules on working holidaymakers and family reunion visas, and cut work rights from visa overstayers. Polls suggest there is support among voters for tighter controls on migration.
As the Coalition prepares its plan to revamp the skilled migration system, they will kick off the week in parliament by campaigning against Labor’s use of grants.
The $170 million Supporting Multicultural Communities program flowed at about 85 per cent to Labor seats, which the opposition’s assistant spokesman for infrastructure Ben Small described as an abuse of funds.
“Albanese has been caught red-handed dishing out … money taken off hard-working Australians and using that money to fund the ghettoisation of Australia at the exact moment in time when we need to be brought together as Australians,” he said.
“You can’t spin these numbers into something that passes the pub test. I’m not suggesting that not a single one of the projects was without merit, but taken together, this is a gross abuse of Australian taxpayer money.”
The biggest winners were the Jewish Arts Quarter in Melbourne in the Labor-held electorate of Macnamara, which received $19.8 million, the Islamic UMA Centre ($11 million, in Sydney’s Labor seat of Banks that was held by the Liberals before the election) and the Federation of Indian Communities of Queensland ($6 million, in the Labor-held seat of Blair).
Labor argues that the skew to progressive-held seats was natural given the Coalition had been wiped out in metropolitan areas where the majority of voters from non-English speaking backgrounds live. The Coalition holds nine seats classed as metropolitan by the Australian Electoral Commission, down from 44 after the 2013 election.
“This is selective and misleading analysis from the Liberals designed to manufacture a political attack,” a spokesman for assistant minister for Citizenship, Customs and Multicultural Affairs Julian Hill said. “Labor makes no apology for investing in communities.”
Hill argued that Labor’s spending fitted with Commonwealth grant rules, which allow this type of funding for pre-election pledges. In contrast the Coalition-era “sports rorts” saga related to competitive grants processes, which are more restrictive than election promises.
There has been a long-running debate on whether election commitments from candidates should be open slather. Independent MP Helen Haines and constitutional expert Anne Twomey have argued in favour of tightening the rules. Nationals leader Matt Canavan rubbished Twomey’s arguments, saying in 2023 that it was “nuts” to prohibit candidates from making promises to local groups and instead hand power to unelected bureaucrats.
Since the 2025 election, Labor has created new guidelines for the multicultural grants program. They emphasise cross-cultural programs rather than spending on programs or organisations that operate for their own narrow purpose.
New grant guidelines seen by this masthead use the term “intercultural” rather than “multicultural”.
“Proposals that build understanding between communities and build intercultural links across communities in Australia are encouraged,” it states. “How will your activity contribute to the grant program objectives, including if and how it will build understanding between communities and build intercultural links across communities in Australia?”
The shift towards “intercultural” funding was made well before One Nation leader Pauline Hanson used a National Press Club speech to call for a monocultural society. Opposition Leader Angus Taylor initially delivered a confused response to Hanson. Former prime minister Tony Abbott declared the multicultural project had failed. Another former leader, John Howard, advocated a middle path of “Australian multiculturalism”, declaring Hanson’s approach “pointless”.
The change on how Labor will prioritise funding puts into practice Hill’s ideas, as expressed in a February speech. The speech, which made headlines at the time, urged progressives to embrace symbols such as the national flag and warned that Labor must do more than promote diversity for its own sake.
“Singapore is strongly focussed on building and renewing intercultural and interreligious trust, understanding and communication,” he said at the time. “Done well, intercultural initiatives will resonate with Australians, and over time should foster reduced prejudice and social polarisation, stronger integration and trust between communities and institutions, and greater resilience to hate-based violence and misinformation.”
“Diversity alone in modern Australia is not and cannot be a sufficient goal. Successful multiculturalism means: cherishing communal identities; building bridges between diverse groups; and celebrating things we all have in common.”
Albanese gave a firm defence of multiculturalism on Saturday in a speech in Melbourne. He said multiculturalism was “part of the bedrock of our future social and economic success”.
“The proposition that we could somehow return to some older, less diverse past is absurd – because that past never existed,” he told the Asian Business Association of Whitehorse.
“With the exception of Indigenous Australians, we are a country of migrants or descendants of migrants. People who came to Australia seeking a better life. Maintaining pride in their heritage while being proud and loyal to Australia.”
Albanese is back at work on Monday after a period of leave. Labor delayed a major announcement on migration last week so that a package of changes could be fine-tuned, amid internal questions on the social and economic consequences of certain measures.
Abul Rizvi, a former immigration department official and migration expert, said none of the proposals under consideration, reported by the ABC and this masthead, would substantially affect the net overseas migration rate.
He proposed a series of changes that he said would bring the figure down from 300,000 a year to the desired 225,000. They included: abolishing the option of a third year of stay for working holidaymakers, which was created during COVID; introducing an entrance exam for international students; forcing onshore student visa applicants to study in an area of long-term demand for the Australian economy; increasing the minimum salary for skilled temporary visas from $80,000 to $100,000; reducing the humanitarian intake from 20,000 to 14,000, noting settlement services are struggling to cope; “highly targeted” moves to deport some of the 100,000 who overstay visas; abolishing fiancée visas; and raising the minimum age of the partner visa to 25.
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Paul Sakkal is Chief Political Correspondent. He previously covered Victorian politics and won a Walkley award and the 2025 Press Gallery Journalist of the Year. Contact him securely on Signal @paulsakkal.14.Connect via X or email.
