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Migrants wanting to become Australians will have to sit a stand-alone English language test before being allowed to apply for citizenship, AAP reports.
Under a raft of new measures introduced to parliament on Thursday, applicants will need to prove a "competent" level of reading, writing, listening and speaking.
It will be up to the immigration minister to determine what level of proficiency is needed.
People aged over 60 and children under 16 will be exempt, as will those with hearing, speech or sight impairments or permanent or enduring physical or mental incapacity.
"English language was essential to economic participation and social cohesion," Immigration Minister Peter Dutton told parliament.
"There is also strong public support to ensure aspiring citizens are fully able to participate in Australian life by speaking English, our national language."
The legislation makes several changes to citizenship requirements as flagged by the Turnbull government in April.
They include changing the period of permanent residency from one year to four, a new values test, and stronger character checks.
Potential citizens will also need to demonstrate their integration into the community, including by "behaving in a manner consistent with Australian values".
Other proposed changes include:
- Renaming the 'pledge of commitment' to the 'pledge of allegiance';
- Allowing a person to be barred for two years if the minister has refused to approve them becoming a citizen on grounds other than failing to meet the residence requirement; and
- Requiring all applicants to be of good character to be eligible for Australian citizenship.
Australian citizenship was an extraordinary privilege and its integrity needed to be ensured, Mr Dutton said.
The new laws would help maintain strong public support for migration and the value of Australian citizenship in what Mr Dutton described as an "increasingly challenging national security environment".
"The Australian community expects that aspiring citizens demonstrate their allegiance to our country, their commitment to live in accordance with Australian laws and values, and be willing to integrate into and become contributing members of the Australian community.
"The measures in this bill will ensure we continue to welcome people committed to the success of our great nation, enriching our society and building our economic prosperity."
Labor, which accused the federal government of "stretching" with its claims the citizenship changes had a national security aspect, will settle its final position at a caucus meeting on Tuesday.
Opposition citizenship spokesman Tony Burke is inclined to think the idea of someone wanting to make a strong commitment of allegiance to Australia is good.
He wants people living permanently in Australia to be fully committed to the country and warned about putting barriers in the way, such as with changes to language requirements for citizenship.
"Is the impact of this legislation going to be that we end up with a permanent group of residents in Australia who will live here their entire lives, who will work here their entire lives and will always be told you don't quite belong?" Mr Burke told ABC radio.
"I'm not sure how that's good for us as a society."