Summary

Notwithstanding the change of Prime Minister and Home Secretary, it appears that the December 2018 Immigration White Paper is still to form the basis of future immigration policy after Brexit. The government claim to have been guided by the Migration Advisory Committee (MAC) in drawing up these proposals and, following pressure from the corporate lobby, have now asked them to review the salary levels for work permits. However, a comparison of the White Paper and the advice that they had previously commissioned from the MAC demonstrates that the government have repeatedly ignored the MAC’s warnings when it suited them and misrepresented others. In drawing up their proposals for the future immigration system of this country (a policy reform that will have far-reaching consequences), they have failed to give adequate account to…

advice by the MAC that the government needs to emphasise investment in British human capital while lessening employer dependence on migration.

the downsides of an increasing population repeatedly referred to by the MAC.

The MAC advice against a scheme for low-skilled workers.

The MAC advice in favour of a primary £30,000 salary threshold (which the government have now asked them to review)

Their evidence that migration has slightly reduced employment opportunities and wages for the lower paid.

The government have also remarkably claimed that the White Paper proposals would help support ‘productivity improvements’ despite the MAC report finding that the evidence was inconclusive.

Introduction

After the EU referendum, the MAC was commissioned to look at the impact of immigration from the EU on the UK. The MAC’s report on this was published in September 2018. Instead of simply analysing the impact of EU migration, the MAC in fact went on to make far-reaching recommendations that would affect the level of non-EU inflows. The government followed this up with publication in December 2018 of its White Paper, outlining plans for the post-Brexit immigration system. However, there are a number of contradictions between the MAC’s advice and the White Paper. This note draws attention to them.

Contradiction 1 – In 2016, the MAC said it ‘consistently emphasised the need to raise British human capital and thereby lessen employer dependence on immigration’. It added that ‘the IT, engineering and health sectors invest insufficiently in UK residents’. Despite this, in the years since 2016, the government has a) removed doctors and nurses from the Tier 2 cap b) ordered a large expansion of the migration list of shortage occupations c) outlined plans to make it much easier for non-EU workers to access the UK labour market after Brexit with much lower skills levels than at present d) proposed easier access to the UK for non-UK scientists. Although it appears to have innumerable ideas on how to further widen access to the UK for workers from outside the EU, the government and businesses’ commitment to improving training opportunities (as well as wages and working conditions) for UK young people is far less clear.

Contradiction 2 – The MAC report noted that ‘higher population may lead to increased congestion’ (p.13), that ‘increases in population do lead to heightened demand for public services’ (p.82), that immigration has ‘increased house prices’ (p.3) and can ‘reduce access to social housing for the UK-born’ (p.95) and that, in 2014, 70% of the public wanted a reduction in immigration levels (p.106). However, the Immigration White Paper appears entirely to overlook these negative findings and instead proposes measures that are most unlikely to reduce immigration materially, let alone to the levels promised in successive Conservative manifestos – also see our estimate of post-Brexit migration levels under the White Paper proposals (April 2019).

Contradiction 3 – The MAC report called for ‘a shift towards higher skilled migration’ and specifically said: ‘For lower-skilled workers, we do not see the need for a work-related scheme with the possible exception of a seasonal agricultural workers scheme’ . Despite this, the government’s White Paper proposes (at par.26) a ‘time-limited route for temporary short-term workers’ to be able to come to the UK to take up any kind of work (and switch between jobs), including low-skilled roles for periods of 12 months at a time. Such a proposal appears to contradict directly the MAC’s advice and to pander to employers’ claims that they cannot get by without continual inflows from abroad to fill the poorly paid jobs they are offering. The MAC has previously noted that the solution to hard-to-fill jobs is to raise the pay for the job.

Contradiction 4 – The MAC report concluded (p.110) that ‘there is… some evidence suggesting that migration has slightly reduced employment opportunities for the UK-born especially for the lower-skilled. Some evidence shows a small negative effect of migration on earnings at the lower end of the wage distribution and a small positive effect at the upper end’. Opening a special route for lower-skilled migration (as the Immigration White Paper does) would be very unlikely to help the government to achieve its industrial strategy aim of creating ‘greater earning power for all’. This concern is exacerbated by the previous Home Secretary’s suggestion that the salary threshold is to be below £30,000. The White Paper’s proposals would likely have a negative impact on the wages of the lowest paid and on job opportunities for the lower-skilled. They may also adversely impact training opportunities, wages and job conditions for UK workers.

Contradiction 5 – On productivity, the conclusion of the MAC report is that ‘while the evidence for a more beneficial impact of high-skilled migration on productivity is not extensive, we judge it likely’ (p.110). The MAC added however that ‘the results are subject to significant uncertainty [and] the evidence on overall migration is not entirely conclusive’ (p.2). There was no compelling evidence that immigration into jobs in the UK requiring less than degree-level qualifications was enhancing of productivity and the MAC noted that some academic claims were ‘implausible’. Thus there seems no basis whatsoever for the Immigration White Paper to claim that the changes to the Tier 2 skilled route would help support ‘productivity improvements’ (p.4 of White Paper). Indeed, reducing the primary Tier 2 salary threshold from the current £30,000, and the skills threshold to A-level equivalent, together with routes to continue inflows to even lower-skilled work, is highly unlikely to boost UK productivity.

Another of the White Paper’s serious shortcomings was that, despite making estimates of the impact of proposals on future inflow from the EU, it made no attempt to estimate the impact of its proposals on the future level of non-EU immigration to the UK. This is a very serious omission on a matter of great public importance. The government should explain why it failed to provide such estimates and, prior to passage of the Immigration Bill before Parliament, set in train and publish such analysis. Given that the government very clearly promised to ‘bear down on non-EU immigration’ in its 2017 election manifesto, policy proposals that would increase it would have the effect of blatantly breaking that promise.

It is to be hoped that the new Home Secretary will see that the White Paper is a simple capitulation to the narrow interests of some employers and urgently instruct her officials to think again and produce something more in line with the MAC’s more sensible recommendations.