Open and controlled – CBI recommendations for a new approach to immigration post - Brexit

Putting migration on the table in future trade talks and ensuring EU workers are not subject to burdensome non-EU visa rules are two key recommendations in a new CBI report on how migration can work UK post-Brexit.

The report, Open and Controlled – A New Approach to Migration, provides evidence from 129,000 firms across 18 industry sectors. Companies want to see a new approach that remains open enough to grow the UK economy, with the right controls to build public trust and confidence (see Notes to Editors for a full list of recommendations.)

Most credible economic studies show that immigration delivers net economic benefits for the UK. Foreign workers put in more than they take out. Their taxes – which pay for schools, hospitals and roads - outweigh the benefits they receive. And, as the Office for Budget Responsibility notes, higher net migration reduces pressure on government debt.

This significant consultation with businesses of all sizes shows the inter-connectedness of different sectors, highlighting just how important migration is to all parts of the UK economy, at all skills levels.

Introducing the report, Josh Hardie, CBI Deputy Director-General, said:

“Freedom of movement will be ending. The building blocks of a successful new migration system for the UK begin with an honest and open debate that has been absent from politics. The stakes couldn’t be higher. Get it wrong, and the UK risks having too few people to run the NHS, pick fruit or deliver products to stores around the country. This would hurt us all - from the money in our pockets to our access to public services.

“The needs are more complex than only ensuring that the UK can attract the ‘brightest and best’. Housebuilding needs architects for design, labourers to dig foundations and electricians to help finish the job. In the food and drink sector, the supply chain starts with agriculture, then logistics and ends with retail.

“This is no longer a theoretical debate – it’s about the future of our nation.  False choices and sloganeering must be avoided at all costs. Openness and control must not be presented as opposites. Public attitudes towards migration and the impacts it has on communities are far more nuanced. Scrapping blunt targets, ensuring all who come to the UK contribute and using the immigration dividend to support public services will add to public confidence.

“For Global Britain to succeed, the UK must send the right signals that show it remains open and welcoming to the world. That means putting migration on the table in trade talks to get us a better deal, first with the EU and then other countries where it is clear existing visa restrictions inhibit trade and foreign direct investment.

“We hope this report is received as a serious contribution to the debate. In these febrile times, it’s vital that a policy of such importance for the UK’s future living standards can be discussed without ideology or an oversimplification of public attitudes. Many sectors are already facing shortages, from nurses to software engineers – so fast, sustainable, evidence-based action is needed.”

The CBI’s recommendations for a new immigration system can be grouped into five themes (full list of recommendations in Notes to Editors):

• Build public trust in the UK’s migration system by shifting away from controlling numbers to assessing contribution and by investing in local public services where demand has been increased by migration.
• Reform the UK’s non-EU immigration system so that firms can better access people and skills from around the world, not just the EU.
• Recognise the strong links between people and trade as the UK forges new economic relationships on the world stage.
• Replace free movement with an open and controlled immigration system for EU workers
• Ensure that the transition to any new migration system is done with respect for people and in an orderly manner

Notes to Editors

Summary of recommendations

Build public trust in the UK’s immigration system by shifting away from controlling numbers to assessing contribution and by investing in local public services where demand has been increased by migration:

1. Drop the net migration target and replace it with a system that increases control by ensuring that people coming to the UK make a positive contribution to the economy
2. Reform the Controlling Migration Fund so that local schools and hospitals receive extra funding where demand is increased by immigration

Reform the UK’s non-EU immigration system so that firms can better access people and skills from around the world, not just the EU:

3. Simplify the process for obtaining a visa so that it is manageable for small companies, by making it easier to become a licensed sponsor or by removing the requirement altogether
4. Reform the Tier 2 visa route so that employers can access the range of skills that they need, not only graduates earning £30,000 or more
5. Scrap the Tier 2 visa cap to give businesses the certainty that workers will get a visa if they meet the Points Based criteria

Recognise the strong links between people and trade as the UK forges new economic relationships on the world stage:

6. Negotiate the simplest possible travel arrangements for all British and European citizens to avoid lengthy border delays at sea and air ports after Brexit
7. Preserve easy mobility of staff in our new relationship with the EU, including intra-company transfers, temporary postings and temporary business visits
8. Ensure that both mobility and migration are an integral part of all future trade deals that the UK negotiates with other parts of the world, starting with the EU

Replace free movement with a new open and controlled immigration system for EU citizens:

9. Establish a new system for EU immigration because extending the current non-EU immigration system would be entirely unworkable for business
10. Introduce compulsory registration for EU citizens soon after arrival in the UK
11. Restrict EU citizens’ ability to stay to three months unless they can prove that they are working, studying or are self-sufficient
12. Secure through negotiation with the EU a new test linked to local labour market conditions, such as unemployment rates for specified professions, which would trigger prioritisation of local recruitment
13. Reinstate controls on access to in-work benefits agreed between the UK and the EU prior to the referendum
14. Continue to exempt EU workers from the Immigration Health Surcharge and the Immigration Skills Charge

Ensure that the transition to any new migration system is done with respect for people and in an orderly manner:

15. Legally guarantee the rights of EU citizens already in the UK, as set out in the draft Withdrawal Agreement, even in the event of a ‘no deal’ scenario
16. Shift the tone of the debate around immigration to focus on the positive benefits and send a signal that the UK is open for business and an attractive place to study, work and build a career
17. Ensure businesses have at least two years to adapt to any new immigration system, from the point at which new rules are known and formally agreed

Kate Nicholls, Chief Executive at UK Hospitality, said:

“This report highlights the pressing need for a future immigration policy that exists to support the UK economy, rather than one which is determined by inflexible ideology or meaningless targets. The CBI’s report also underlines the importance of engaging in an open and honest debate about the realities and practicalities of migration to the UK and its effect on business.

“The hospitality sector is particularly in need of a future policy that provides employers with access to talent to support continued investment and growth. This means acknowledging the need for a variety of workers across the sector at many levels, not just those who are deemed highly-skilled. We particularly welcome the recommendation to secure the rights of current EU citizens in the UK, regardless of an exit deal.”

Angela Coleshill, Competitiveness Director, Food and Drink Federation said:

“This report provides a much needed deep-dive study into the significant contribution EU nationals make to the UK economy and we hope it will be used to shape future immigration policy once we have left the EU.

“There is arguably no industry more reliant on EU workers than UK food and drink manufacturing, with a third of the industry’s 400,000 strong workforce coming from the EU. These workers play a vital role in guaranteeing the success of our £28.2bn industry and are employed across the full range of skill levels, in every region of the UK. It is therefore vital that any new migration system not only recognises the important role EU workers play in feeding the country, but also their contribution to wider society, in towns and cities across the country.”

Vinous Ali, Head of Policy at TechUK, said:

“The UK tech sector is thriving – growing at more than double the rate of the wider economy, at the heart of this success story is people. Post-Brexit the UK must retain its position as a talent magnet – drawing in the talent and skills we need to continue to grow and innovate. This means recognising and responding to the positive impact of immigration – to our economy as well as our communities.

“This report provides some tangible policy recommendations that can help restore trust in our immigration system. We hope that the Government will reflect on these proposals and ensure that we continue to attract the talent we need to deliver its vision of Global Britain.”