Australia appears likely to bypass present blockages to clear a new way for New Zealanders to gain residency and citizenship across the Tasman.
Although details have yet to emerge, it seems likely that New Zealanders may be able to apply to become residents after a qualifying period, probably of several years.
As many as 100,000 expatriate Kiwis are believed to have been caught by the 2001 rules change that allows them to live and work on temporary visas, but excludes them from welfare and other support systems.
Unless the rules change, they could spend their lives living on the edge and with no chance of government help.
Further problems surfaced during Victoria's Black Saturday fires and last summers floods and cyclone in Queensland, when New Zealand victims were denied access to emergency assistance.
Under pressure from Wellington and with the personal intervention of Prime Minister Julia Gillard federal and state relief was finally made available, but hardship in the meantime put a new focus on the limbo in which many Kiwis live.
Prime Minister John Key, in Melbourne for talks with Gillard and a joint meeting of the two countries' cabinets, said yesterday that Australia was now working on a new pathway to residency and citizenship.
The proposal will be discussed by the two leaders today.
Although the scheme had not been finalised, Key said it was on the track to being achieved and "all signals are that this will happen.
Details have not yet emerges but it appears likely to change present rules that require New Zealanders to join the overall migrant stream to gain residency, based on skills and demand.
Without residency and provided only with temporary visas, low-skilled Kiwis especially have little chance of permanency and access to government support.
"Since 2001 quite a number of New Zealanders have found themselves not quite stateless, but nor citizens or permanent residents," Key said.
"The Australians are looking towards a pathway to residency that would solve that for 100,000 New Zealanders, potentially."
Most of the other 350,000 Kiwis in Australia are believed to have been living across the Tasman before the 2001 rule change, or have gained residency.
"At the moment if you come over to Australia and you are not in a high-skills category you can work in Australia, but you won't necessarily be successful in becoming a permanent resident," Key said.
"Australia is working to resolve that issue, (although) not solely for New Zealanders.
"It's a positive thing.
"It will not fix every situation, but it will provide much better rights and provide that pathway to residency and citizenship...
"Australia has recognised there are some real anomalies in the system and I think they have ultimately quite generous when a natural disaster has come along."
Key said access to the proposed system would not be automatic and conditions would be imposed.
Applicants would need to qualify in areas such as good character, and not everyone would succeed.
It appears likely a qualifying period will be imposed, and Key said that for New Zealanders moving to Australia it would be a question of when the financial benefits started to flow through.
"I think that every New Zealander who travels across the Tasman needs to consider what is the nature of support they are looking at before they make their move," he said.
Key said the final shape and timing of the system was for Australia to decide.
"New Zealand acknowledges the sovereign right of Australia to make conditions about when and where they provide financial support or other support, and what their conditions are for residency and citizenship.
"So it is a fine line we tread."
Key his talks with Gillard would also cover the issue of the disclosure of criminal records, with Australia keen to improve the flow of information across the Tasman in the wake of high-profile cases such as Joel Hohepa Morehu-Barlow, the New Zealander charged with stealing more than A$16 million from Queensland Health.
He said further work was needed to improve the transtasman exchange of information, and that the present system of voluntary disclosure of criminal records on immigration cards was something that could be explored.
