Tuesday, 1 April 2008


A report out today by the House of Lords Economic Affairs Committee is going to create a political storm. The central argument of the report is that the economic benefits of high net migration are either small or non-existent (the report doesn't go into the social or other impacts of migration- for example, could we really have expanded the NHS over the last decade without the work of doctors, nurses, and care workers from overseas? No is the answer.)

It is worth reading the report because it makes a lot of good arguments and contains much authoritative analysis. Its conclusions are based on available evidence but, as the report acknowledges a lot of information that is needed, is just not available. We can not properly quantify, for example, what the spillover effects of immigration are. Having more skilled people in the UK can increase the skill levels of the resident community and that is something that is difficult to measure.

The strangest argument in the report is that annual immigration should be within a 'target range.' To cap immigration would be economically damaging. As the report itself argues:

"We recognise that there is a case for enabling employers to hire significant numbers of highly-skilled foreign workers. But whether this implies positive net migration is another issue."

Well, no it isn't quite 'another issue.' If employers such as the NHS, the City, Universities, high-tech and research industries want to hire additional highly-skilled workers they may be prevented from doing so if there is an artificial cap. John Wakeham's argument in The Guardian today (that is also expressed in the report) that increased mechanisation or increases in pay could resolve skills shortages just doesn't apply in a lot of very significant cases such as those mentioned above.

To my knowledge, nobody is arguing that high net immigration- the target of this report's criticism- is per se a good thing. The basic policy position, as underlined by the new demand -based system where non-EU economic migrants will only get a visa if they have needed skills, is aimed at meeting the needs of employers', the economy, and local communities rather than at promoting a particular level of immigration (or emigration for that matter.) To that extent, this report is criticising a policy which does not exist.

However, the report is most interesting in its analysis of the impact on recent immigration on low-pay workers. There is no doubt that we need to actively consider better protection of these workers: better skills provision, protection for agency workers, and proper enforcement of the national minimum wage.

With these changes we can ensure that the immigration system provides economic benefits, protects the vulnerable, secures better public services, complies with international obligations and human rights and ensures that the UK is the open, welcoming, embracing and diverse nation that is its great strength.

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