Australia's migrant population is expected to have grown by more than 700,000 between the 2022 and 2024 financial years.
A faster-than-expected return of international students and working holiday-makers following the reopening of borders is thought to be a key factor explaining the hike.
Australia's net overseas migration (NOM) level, which represents the difference between incoming migrants and outgoing migrants over a 12-month period, is expected to be 400,000 in 2022-23 and 315,000 in 2023-24.
Pre-pandemic migrant intake gain was around 235,000 per year.
Anyone who has stayed in or has been outside of Australia for more than 12 months is counted in NOM, regardless of visa or citizenship status.
It includes both permanent and temporary residents, but tourists and visitors aren't counted.
Numbers boost raises housing fears
The national cabinet discussed the historic NOM forecast on Friday.
Following the meeting, Prime Minister Anthony Albanese said the Commonwealth would "ensure that states and territories have a greater contribution to Australia's migration settings".
Earlier this week, Home Affairs Minister Clare O'Neil announced sweeping changes to the migration system in line with a review recommending future planning should be based on NOM figures, instead of relying on permanent migration caps.
She stopped short of specifying any migration intake figures.
"I'm not someone who advocates for a 'big Australia' in this conversation," Ms O'Neil told the National Press Club in Canberra.
Speaking to the ABC, Shadow Minister for Immigration Dan Tehan said the NOM figures confirm "the Albanese government is running a big Australia policy by stealth".
"They have no plan to deal now with what is a confirmed 715,000 increase in our population over the next two years," he said.
"What does this mean for housing? What does it mean for rent? What does it mean for congestion in our cities?"
Leading economist Chris Richardson said these are valid questions.
"You cannot have this number of people arriving in Australia with our current housing situation. It needs to be lifted to higher levels," he said.
"You can't have the people power that Australia is getting without the infrastructure.
"I'm in favour of a strong migration policy, but it's only half a policy until we build to meet the needs that go with it."
But Mr Albanese insisted the government was well prepared to handle the additional intake, noting the figures were still significantly under levels predicted before the COVID-19 pandemic, which saw a halt to overseas arrivals.
"Our population will be less than what was predicted by their government — by them — when they were in office," he said on Saturday.
"There's been a pandemic! It meant our borders were closed, it meant people weren't coming in — what we've announced is a comprehensive migration plan.
"We have a range of policies in place."
Long-term border closures and an outflow of migrants during the COVID-19 pandemic saw Australian net overseas migration drop to -85,000 in 2020-21.
The equally historic dip means Australia is not expected to catch up to pre-pandemic forecasts until 2029-30.
It's not the first time
Last time Australia saw a spike as big as the current forecast was following the Spanish flu and World War I, when NOM figures followed a similar pattern.
In 1919, Australia recorded its only negative NOM greater than the one from the COVID-19 pandemic.
It was followed by an equally aggressive hike in the following years, adding up to approximately 3 per cent of the total Australian population at the time.
The latest increase in net overseas migration will account for 1.5 per cent of the total population.
