28 September 2018

News

CBI responds to government commissioned immigration report

Following publication of the independent Migration Advisory’s Committee 14-month long study into the impact of EEA migration, the Cabinet begins to make key decisions on immigration policy after Brexit.

CBI responds to government commissioned immigration report

After 14 months of stakeholder engagement and research, the independent Migration Advisory Committee (MAC) have published their long-awaited report on the impact of European Economic Area (EEA) migration on the UK. 

The headline for business from the MAC report is that it recommends a future immigration system not give any preference to EU migrants over those from non-EU countries. If implemented, this could hurt the UK economy as key workers are unable to come to Britain. 

Among the report’s key findings is that migration under free movement has had little to no impact on employment, unemployment or wages of UK-born workers. It also highlights that there is very little evidence of a negative impact of immigration on investment. Furthermore, EEA migrants pay more in taxes than they receive in benefits – worth net £4.7bn in 2016/17. 

Read the full MAC report 

The MAC makes 14 key policy recommendations. Amongst the key highlights for business are the positive proposals for higher-skilled workers to abolish the Tier 2 cap of 20,700 visas and remove the 28-day resident labour market test (RLMT). However, disappointingly the MAC recommended to retain the £30,000 salary threshold and not have a route for ‘lower-skilled’ migration below this level. This would block many essential workers from coming to the UK. The MAC also recommend reviewing the current sponsor licensing system, which is complex and costly for employers to navigate, but without making specific proposals for improvements. 

Read the CBI’s full analysis of MAC report 

In response, CBI Chief UK Policy Director, Matthew Fell, was clear that the MAC missed making a critical recommendation that migration should be part of trade negotiations, starting with the EU. Matthew also said that the current system is highly bureaucratic and cannot be extended to EU workers without major reform. 

In addition to Matthew’s comments, CBI Chief Economist, Rain Newton-Smith, discussed the report on BBC news. Watch Rain respond to the report

The publication of the MAC report marks a key milestone in the Government’s development of a new immigration system after Brexit and following its publication, the Cabinet met to agree the overarching principles of a new immigration system. The Government is now expected to publish a White Paper outlining details on design of a new system before the end of the year. 

For more insight and intelligence on the latest Brexit developments and its implications, visit the CBI’s Brexit hub or contact Tom.Barrett@cbi.org.uk