Post-Brexit Economic Migration Policy after Coronavirus: Time to Change Course

Introduction

The Home Office has a plan for  UK economic immigration policy after the end of the Brexit transition period (31 December 2020). That is to be expected. It was published on 19 February 2020 as The UK’s points-based immigration system: policy statement; see my blog post A Mortification of the Flesh: UK Immigration Policy for EU Citizens after Brexit, which sets out the many problems with this plan even before the impact of the Coronavirus from March 2020 onwards. The Home Office’s aim was to end free movement and to attract so-called ‘high-skilled workers’ to contribute to the economy, communities, and public services.

How should the Coronavirus crisis change the Home Office’s plans for post-Brexit economic migration policy? What fresh thinking about immigration routes is needed to help stimulate the UK economy through inward investment, entrepreneurial activity, and innovation? What is ithe Home Office plan to attract, retain, and treat well, the so-called ‘low-skilled’ workers (now properly understood as ‘key workers’) who the Coronavirus crisis has shown are much needed in the health and social care sectors?  At a time when all countries in the European region will be looking to kick-start their economies, how is the  UK economy at all levels to get the workers it needs so that economic activity in the UK grows as quickly as possible?

The January 2020 Migration Advisory Committee Report

That February 2020 Home Office policy statement was published following the January 2020 report of the Migration Advisory Committee (MAC) on A Points-Based System and Salary Thresholds for Immigration. Although the MAC is often referred to as an independent body it does not make broad recommendations as to the immigration system it considers to be in the interests of UK society and its economy. Instead, it receives commissions from the Home Secretary; commissions that are narrowly framed to advance a pre-determined political agenda. In this case the MAC was asked to report on salary thresholds in the prospective immigration system, the mechanism for calculating future salary thresholds, whether there should be regional salary thresholds, and the case for exemptions to salary thresholds. In addition, it was asked to review how an Australian-style points-based immigration system could be introduced in the UK.

In its report the MAC examined the labour market context, the use of points-based systems in other countries, and the UK experience of a points-based system. Against that backcloth it made its recommendation as to the modifications that could be made to the UK points-based system. As regards salary-thresholds for work permits (under the Tier 2 (General) route), it took evidence, considered their rationale and impact, and made recommendations. Following the MAC’s report, the Home Office published its policy statement.

It is the MAC’s report that allows the Home Office to advance the contention that its plan is based on evidence. However, as already noted, the commission the MAC received was narrowly framed and deployed in the service of a pre-determined political agenda. Lest there be any  doubt about that, consider this:  it would have been impossible for the MAC to look at the impact of current UK immigration control on UK society and its economic interests and decide that there was no case for ending the free movement system with the EU. The shape and scope of the commission received from the Home Office prevented such an outcome.

There is also a further problem with the Home Office simply relying on the MAC report in order to continue with its plans for post-Brexit economic migration policy: the Coronavirus crisis has rendered even the limited scope of the MAC’s analysis redundant. It has simply been overtaken by events. The needs of UK society and its economy are changed utterly. If the MAC is to play any meaningful role, it must urgently produce a new assessment and on a much broader commission.

Home Office plans for post-Brexit economic migration

Under Home Office plans published in its February 2020 policy statement, from 2021 there is to be one economic migration system for EU citizens and non-EU citizens/third-country nationals alike. Tier 1-type migration (where no-sponsor is required) under the Global Talent, Start-up, and Innovator routes, etc. will open to EU citizens, as will a revised version of the current Tier 2 (General) (sponsored work permit) scheme where the accumulation of points may lead to a grant of permission to reside and take employment. In addition, the Tier 5 (temporary migration) route will be opened to EU citizens, as will the route to enter the UK as a business visitor.  EU citizens who wish to work in the UK will require entry clearance/ a visa before travelling to the UK. There is to be no general route for the self-employed outside of the very the limited provision made in the Tier 1-type routes. For a full consideration of the problems in the proposals prior to the Coronavirus crisis, see my blog post A Mortification of the Flesh: UK Immigration Policy for EU Citizens after Brexit .

The Impact of the Coronavirus crisis

 As a result of the Coronavirus crisis UK economic output is predicted to decline by 13.5-15% in the second quarter of 2020 and to partially recover in the second half of the year. GDP in 2020 is expected to be 4% less that in 2019, see Coronavirus forecast to cut UK economic output by 15%. On any reckoning there is a need not to damage the economy further. On any reckoning there is a need for economic migration policy to play its part in stimulating economic activity in the wider interests of society.

As already noted, if the Home Office is to draw on the work of the MAC it will need to commission a new report from it and give itmuch broader remit than it gave last time. However, if the urgency of the situation and the lack of time before the end of the transition period (31 December 2020) prevents this step, there is  time still for the Home Office to take active steps to contribute to the task of economic regeneration and to prevent further damage to the UK economy and society by revising it economic migration policy.

Time to Change Course

There is an urgent need for the Home Office to revisit its economic migration plan as a result of the Coronavirus crisis. In doing so, it must remember that there is no fixed number of jobs in the UK economy (the lump of labour fallacy) and that the more economic activity there is, the quicker UK society and its economy will recover. While UK unemployment will rise in the next few months, such spare capacity as that provides can only be taken up if the UK economy is growing and so it is vital that all measures to stimulate the economy and protect society should be taken. To that end, the steps the Home Office should take include:

(1) Support an extension to the Brexit transition period (for one or two years) beyond 31 December 2020: At the very least the Home Office should do no harm. By accepting the need for free movement of persons between the UK and the EU to continue for a while longer, the Home Office would contribute to arresting the post-Coronavirus crisis damage to the UK economy that is likely to be done by ending the free movement of goods, services, and capital. All competitor countries in the European region will be seeking to rebuild their economies, attract new businesses, and make their territories a magnet for entrepreneurially minded people who wish to migrate within the European region. During the time it was in the EU, the UK was among the most attractive destinations for dynamic EU citizens. As between the UK and the EU, any imposition of tariffs and non-tariff barriers on goods, the end of free movement of services (with narrow exceptions), and the end of free movement of capital, will harm and impair the UK economy (there is a debate about for how long, and to what extent, but harm there will be). Further, ending free movement of persons (which will of course continue among EU states, as will free movement of goods, services, and capital) will put the UK at a disadvantage in attracting the people it needs at all levels and in all parts of the UK economy. To help stimulate economic growth and protect UK society, the UK needs not just the Spanish nurse and the Bulgarian social care worker (though the Coronavirus crisis has shown to all their true value), it also needs the German banker, the self-employed Italian journalist, and the Norwegian academic, as well as agricultural workers. This is not the time to be disrupting the movement of such people to the UK. It is not right to suggest that the work of such people can be picked by the settled population now or later.

(2) Recognise that trade deals with other countries and blocs take time and that UK economic migration policy needs to be open to inward migration in the meantime: The Home Office needs to move away from on overly prescriptive and bare bones approach to economic migration policy and to open routes to the inbound economic migration that the UK economic sorely needs to help protect UK society and to help rebuild the economy. So-called free trade agreements offer very little in the way of mobility for people (beyond narrowly defined areas such as corporate investment and short-term service provision by regulated professionals) and so there is no point in waiting for them to be concluded. In any event, good, broad, trade agreements take years to be concluded. There is no time to wait. To that end a far more open approach to economic migration is needed now, see below

(3) Recognise that imposing economic migration controls on EU Citizens will lead to the 27 EU States imposing similar restriction on British citizens and to design UK economic migration policy accordingly: If British citizens are to work in the EU, provide services there (on behalf of UK-based businesses), and to trade goods in EU states, they will need permission to enter and stay or reside in those countries and authorisation to work there. The easier that is for them, the better it is for the UK economy and society. British citizens need light-touch economic migration routes into EU states. EU economic migration policy is not harmonised and beyond short-term business visitor routes, British citizens face the prospect of different immigration rules in each EU state and no easy way to move between EU states. If the UK is open to EU citizens migrating to the UK for work and provides easy routes for them to do so, EU states are likely to reciprocate. Such an approach could be the subject of negotiation but, in any event, its necessity is obvious.

(4) Re-design the Tier 1 Investor Route to make it appetising: To attract migrants who wish to invest in the UK economy the Tier 1 investor route should be redesigned to make it appetising to investors. At present the take-up is very modest. There should be a mapping study of comparable schemes in the European region and globally and the essential features of an appetising scheme should be identified, with a revised UK scheme designed around them. At the same time two other features should be incorporated. First, to secure support for such a scheme, the sums invested should include a donation to UK public health and social care services, such as hospitals and care homes. Second, to attract investor migrants from EU states, there will need to be provision that recognises that moving from affluent European countries like France or Germany to the neighbouring UK requires a different approach to attracting investors globally from counties such as China, Russia, or India. Unless the Tier 1 investor scheme is appetising both regionally and globally, it will be not work effectively.

(5) Revise the Global Talent, Start-up and Innovator routes so that they work properly: It not unkind to observe that the Home Office is not very good at designing economic migration routes. The Global Talent route like its predecessor sets the bar for highly-skilled migration at a level where the take-up is likely to be modest; the Start-up route has yet to show it can generate much interest, and the Innovator route is just hopeless (the take-up is in double figures!). A root and branch re-think is required if these routes are to function in any real way. Otherwise these routes merely pay lip-service to the idea that entrepreneurial migration is encouraged. If the Home Office is serious about these areas, it needs to set ambitious targets for securing significant numbers of migrants in all three routes and to liberalise the way in which the rules  for these routes work to meet those targets. By doing so it would contribute properly to the urgent task of reviving the UK economy.

(6) Make Key Worker routes easy and straightforward: The Coronavirus crisis has taught the UK much about the value of key workers and of so-called low-skilled migration. The Home Office should draw up a list of all those who are key to the maintenance of the health and social care sectors, not just doctors and nurses, and create a dedicated immigration route for them. Salary thresholds for entry, residence, and settlement should either be disavowed or set at a level where they can be met easily. In addition, there should be no question of any Immigration Health Surcharge or Immigration Skills Charge being imposed. Further, there should be no imposition of a ‘No Recourse to Public Funds’ condition on key workers’ visas; in-work support for housing benefits and working tax credits (now part of Universal Credit) is vital for those on modest wages.

(7) Introduce an Unsponsored route that caters for the Self-employed: The Home Office’s February 2020 policy statement trailed the idea of a unsponsored route within the points-based system to run alongside the employer-led system. This should be broad enough to allow skilled self-employed people to migrate to the UK to work in areas of the economy where their skills are needed. It should not just cover the regulated professions such as barristers and accountants but extend to other areas such as journalism and those working in IT, where working as a freelance or consultant is not unusual and where such work buttresses the ability of UK-based businesses to expand or take on work quickly. The skills level should not be set too high, allowing for the fact it may be determined by characteristics such as academic qualifications, age and relevant work experience. The route should be implemented as soon as possible.

Conclusion

If the Home Office proves unable or unwilling to respond to the Coronavirus crisis by re-thinking and re-setting its post-Brexit economic migration policy, there is a case for such policy-making to be taken away from it and given to a cross-departmental ministerial committee capable of responding flexibly in the national interest. The Treasury, the Department for Business, Innovation and Skills, and the Department for International Trade have a role to apply and the Home Office’s role in setting policy may need to be pegged back.

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