Scottish business groups have heavily criticised plans for a new post-Brexit immigration system set out in the UK Government's Immigration White Paper.

In the white paper, the Government's numerical cap on skilled workers - currently 20,700 a year - would be axed.

Instead it intends to impose a minimum salary threshold - although it stopped short of committing to a £30,000 figure.

Meanwhile for sectors reliant on lower skills overseas labour, such as agriculture and food and drink, tens of thousands of migrants could apply for a 12-month visa - a move in place until at least 2025.

The new skilled work route would be opened up to workers with 'intermediate' level skills - likely to cover occupations such as driving instructors, plumbers and restaurant managers.

In an effort to speed up the recruitment process, employers of skilled migrants would no longer be required to carry out a "resident labour market test".

In other features of the system:

• Anyone who wants to come to the UK would need some form of permission

• EU visitors will not require a visa in advance of travel but an Electronic Travel Authorisation scheme would be introduced

• There would continue to be no limit on the number of international students who could come to study in the UK

• Existing rules on bringing family members to the country, including minimum income requirements, would be extended to settled EU citizens

Introducing the document, Prime Minister Theresa May wrote: "This will be a system where it is workers' skills that matter, not which country they come from.

"It will be a single system that welcomes talent, hard work and the skills we need as a country."

However CBI Scotland and FSB Scotland were far from impressed.

CBI Scotland director Tracy Black said: “A new immigration system must command public confidence and support the economies of all parts of the UK. These proposals would achieve neither.

“The proposals outlined in the White Paper don’t meet Scotland’s needs or the needs of the UK as a whole, and would be a sucker punch for many firms right across the country. The UK Government’s own analysis suggests people and regions will be poorer as a result of them.

“The Government cannot indulge in selective hearing. It tunes in to business evidence on a disastrous Brexit no deal, but tunes out from the economic damage of draconian blocks on access to vital overseas workers.

“The facts are clear. Brexit is cutting off the ability to recruit and retain staff for 9 out of 10 firms. Despite firms across the UK spending over £45 billion in training each year, staff shortages are already biting. Hospitals, housebuilders and retailers are all struggling to find the people they need at salaries well below £30,000.

“These proposals must change. And when a new system that will work is agreed, businesses across the UK must be given time to adapt. This means at least two years to implement the changes after the rules are finalised.

“Further consultation is needed to get this right for the whole of the UK, otherwise calls for devolved and regional immigration policies will only grow louder.”

On the Government’s proposal for lower-skilled visas, she said: “All skill levels matter to the UK economy. A temporary 12-month route for overseas workers earning under £30,000 would encourage firms to hire a different person each year. That needlessly increases costs and discourages migrants from integrating into local communicates – a key social concern. It’s not good for the public or business."

On a new streamlined visa system and migration linked to trade, she added: “The ambition to streamline the visa system absolutely must be delivered on. Business needs to see concrete proposals and a commitment to implement simplifications at the same time as any new controls.”

“The Government must not introduce a new system in 2021 that isn’t workable until 2025. Any new approach will be a major change to the labour market, and firms must have time to adapt.

“To secure the best trade deals around the world, the UK must be willing to put migration and labour market access on the negotiating table – starting with the EU, our most significant trading partner. Failing to recognise this will hamper efforts to secure the UK the best trade terms possible.”

The Federation of Small Businesses (FSB) in Scotland demanded an urgent rethink, warning that these proposals will have a disproportionate impact on firms north of the border.

It called on UK ministers to introduce a more flexible system that "accommodates the skills needs of Scottish firms and the demographic demands of Scottish communities".

It has also written to Scotland Secretary David Mundell about their concerns.

Andrew McRae, FSB’s Scotland Policy Chair, said: “The UK Government’s obstinate approach to immigration is a clear threat to many of Scotland’s businesses and local communities. These proposals will make it nigh impossible for the vast majority of Scottish firms to access any non-UK labour and the skills they need to grow and sustain their operations.

“Smaller Scottish businesses hire EU citizens to work across a wide range of occupations – from carers to retail workers, from bar staff to engineers. Predominantly they do so by advertising a post and taking on the best person for a job, who almost always is already living in the country.

“Requiring employers to grapple with what is currently a clunky and costly immigration system to hire international talent will have significant implications for the small business community in Scotland. The risk is that this makes small business owners into de-facto immigration officers.

“The proposed system also puts a lot of faith on Whitehall officials to predict the skills needs of a Dundonian manufacturer or a Highland hotelier years in advance. This reliance on state central planning is not the hallmark of a dynamic, responsive trading environment.”

Show more

He added: “Over the next year, we need to see the UK Government listen to what Scottish businesses are telling them – that these proposals don’t suit our needs, nor the needs of our local communities, nor those of the Scottish economy.”

Marc Crothall, Scottish Tourism Alliance chief executive said: “The UK Government’s measures on immigration published in today’s white paper could have potentially devastating effects on Scotland’s tourism industry, in particular, a £30,000 minimum salary threshold were this to be passed by legislation following a consultation.

"There is no doubt that the government’s plans will exacerbate the existing recruitment crisis considerably, placing our tourism industry and what is one of the most important economic drivers for Scotland in severe jeopardy.

"The STA supports the Scottish Government’s proposals for a tailored migration system for Scotland, as outlined in the discussion paper ‘Scotland’s Population Needs and Migration Policy’, including proposals for a Scottish visa that would remove barriers caused by the introduction of the recommended Tier 2 salary cap of a £30,000 threshold as proposed by the MAC.

"Scotland’s situation is unique; we have very fragile areas in our economy and it is more important than ever that we’re able to attract and retain people, particularly in the Highlands and Islands and other rural areas. We need a differentiated system that is responsive to the specific needs of our tourism industry, our demography and our wider economy and sectors.

"The impact of these proposals across local economies, particularly in rural areas in Scotland is likely to be profound. We will be encouraging all tourism businesses to share their views in the consultation outlined in the Home Secretary’s announcement.

Brian Berry, chief executive of the FMB, said: “The Government seems hell-bent on ignoring the business community when it comes to its immigration policy, as demonstrated by this disastrous White Paper.

"Despite more than two years of constructive engagement, what has been proposed by ministers takes on none of our feedback. If the Government wants to jeopardise the UK economy for the sake of meeting an arbitrary immigration target, it’s going the right way about it.”

The paper was also criticised by The Entrepreneurs Network founder Philip Salter.

He said: “Entrepreneurs will be disappointed by today’s immigration announcement. In survey after survey, entrepreneurs rank access to talent as the number one obstacle to growth. Yet under the proposed system, startups will face more red tape and will struggle to meet the suggested £30,000 salary threshold to hire the workers they need.

"Entrepreneurs will welcome the abolition of the cap on high-skilled workers and the resident labour market test, but this is offset by the decision to pull up the drawbridge to EU workers. This will make Britain a worse place to start and grow a business and will lead to venture capitalists looking elsewhere.

"Requiring a job in advance of moving will put off prospective European entrepreneurs who up until now have been able to experiment by working for UK start-ups before building their own business.

"If the Government goes ahead with these plans, it will put the UK at a significant competitive disadvantage to EU countries and result in less investment into the high-growth businesses that drive prosperity and ultimately increase the wages of all workers.”