It will be up to states to plan where new migrants should settle under potential changes to Australia's national migration program.
Prime Minister Scott Morrison has flagged migrants could be asked to spend five years in a regional area if they want permanent residency.
Because the states plan roads, hospitals and schools, they need to say where they want population growth.
"This is a blinding piece of common sense, which is: how about states who plan for population growth and the Commonwealth government who sets the migration levels, actually bring this together?" Mr Morrison told Sky News on Monday.
