A landmark government review into the “broken” migration system has called for “major reforms”, including an overhaul of the skills lists to better keep pace with the tech sector.

A government-commissioned review led by former public service chief Martin Parkinson found that the migration system needs far more than just “tinkering”, with wholesale changes required to attract the best workers to Australia and stamp out exploitation.

The review found that Australia’s migration system is “not effectively targeted to either current or future needs”, and is far too focused on temporary migration rather than providing permanent residency to the workers the country will need in the future.

“The migration system is neither fast nor efficient and is often perceived as unfair,” the review said.

“Users, current and potential migrants and businesses find the system unnecessarily complex and difficult to navigate at all levels.

“There is growing international competition for highly skilled migrants and Australia risks falling behind without more innovative and attractive visa products and service delivery.”

The number of temporary migrants in Australia has doubled to 1.8 million people since 2007, while the number of permanent places on offer has remained the same. This has created a risk that Australia will become a nation of “permanently temporary” residents, the review found.

The skilled occupation list used by the government was in the crosshairs of the review, which found it is “outdated” and not based on a “strong evidence base”, while it also said the points test used to select skilled migrants is not successfully identifying the best applicants.

“They do not reflect current or anticipated skilled labour needs, including to support the transition to a net-zero economy, or to build critical and sovereign capabilities,” the review said.

Speaking on ABC’s 7.30 Report on Wednesday night, Home Affairs Minister Clare O’Neil said the skills list is particularly ineffective when it comes to the tech sector.

“It’s archaic because it relies on a really detailed definition of occupations and especially when we have something like the tech sector, where the descriptions of jobs change really quickly,” O’Neil said.

“Basically, you write the list and it’s out of date the next day.”

Labour market testing should also be abandoned, the review recommended, with this approach being “insufficient” in ensuring that “migrant workers are used to complement and not displace domestic workers”.

Australia’s migration system is also failing to attract international students to remain in the country after their studies, the review found.

“The student visa program should be an important source of high performing skilled migrants but has not delivered on its potential,” it said.

“Various student and temporary graduate visa settings inhibit students’ opportunities and ability to show they can succeed in the Australian labour market.”

The current system has also failed in preventing migrant workers from being exploited in Australia, the experts found, with the review pushing for the salary threshold for temporary skilled migrants to be increased from the current bar of $53,900.

“There is widespread evidence that temporary migrant workers are exploited, and aspects of the migration system heighten this risk,” the review said.

O’Neil previously labelled the migration system as being inadequate and in need of urgent reform.

“Our migration system is broken,” O’Neil told the ABC on Wednesday.

“It’s not delivering for Australians. It’s not delivering for our businesses and it’s not delivering for migrants themselves.”