The number of family migration visas will be cut by 5750, with an increase of the same number for skilled migration visas.
The government's overall migration program will remain unchanged, with a total of 168,700 places.
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"These reforms support the Government's policy to deliver a more demand-driven skilled migration program that meets the needs of the economy in sectors and regions where there are shortages of skilled workers," Immigration Minister Chris Evans said in a written budget statement.
"Foreign skilled labour is an important driver of economic growth and contributes to increased productivity and labour force levels. It also benefits migrants by ensuring they have a job with a direct match to their skills on arrival in Australia," Senator Evans says.
Of the total 168,700 program places, 113,850 are for skilled migration, 54,550 in the family stream and 300 special eligibility places. These changes are expected to provide an increased revenue of nearly $259 million over four years for the federal government.
The government will spend $33 million over five years to alter the eligibility requirements of the General Skilled Migration (GSM) applications following a review of occupations on the In Demand list.
The reforms, which took place early this year, sparked furious outcry from international students, many of whom found their applications for GSM rejected after the changes took place.
