Reforming British Migration Policy
1 October 2000
SUGGESTED
Research
1 September 2000
Energy and Environment
Below is the draft of a lecture given on 10th October 2000 as part of the 'The Beesley Lectures: Lectures On Regulation Series X 2000' organised by Professor David Currie of the London Business School and Professor Colin Robinson of the IEA. This is reproduced with the kind permission of Professor Currie
10 October 2000
Tax and Fiscal Policy
19 November 2024
This paper argues that currently British migration laws are skewed against economic migrants in a way which is harmful both to the migrants themselves, and also to the UK population
Foreword
This paper has been written at a time when the issue of migration is more important in British politics than it has been for nearly 20 years. In September 2000 the Labour Government indicated formally that it was in the process of reviewing British migration policy, and asked for a public debate. Although this paper was being researched well in advance of this announcement, it now forms part of that debate.
Reforming British Migration Policy is about existing policy and what reforms could be enacted to improve current migration systems; it will be followed shortly by a paper which addresses common fears about migration, and which shows that most are of doubtful justification.
It is notable that despite the wealth of academic material concerned with certain aspects of migration in the UK, particularly the social conditions of ethnic minorities, many of the biggest immigration questions are under-researched. Issues such as the historical impact of migration on employment, welfare and growth in the UK have surprisingly little written on them, almost certainly because the process of gathering data for such surveys is extraordinarily expensive, and difficult to interpret into meaningful results.
As a result much of the information on which this paper is based is gathered from government sources rather than academic research. Hopefully, the present debate will have the side effect of stimulating larger scale research into migration to the UK.
Abstract
This paper argues that British migration laws are skewed against economic migrants in a way which is harmful to Britain. Policies designed in a different economic era dictate who is allowed to live and work in the UK, and do so in a manner which is unresponsive to the desires of Britons and British businesses. The existing migration systems also create incentives to abuse the asylum process. A proposal is made for a work permit system which is market driven, but which retains control mechanisms for government.
1 – What are ‘economic migrants’?
‘Economic migrant’ is a term employed in two significantly different ways. In an academic context, an economic migrant is anyone who migrates, either within a state, or from one nation to another, for economic reasons. However, in current press and political discourse, an economic migrant has become someone who claims asylum falsely, with the aim of living a life of ease at the expense of their host state’s welfare system.
By confusing these two meanings, intentionally or otherwise, writers and commentators who are against migration have managed to tar the former category with the same brush as the latter.
In a typical example of the current confusion over migrants, Jack Straw told the House of Commons that:
“We must be able to provide support to those in genuine need, but we must do so in a way that minimises the incentive to economic migrants who undermine public support for genuine refugees.” 2
In this case Mr Straw cannot have been talking about economic migrants as correctly defined, because he indictes that he wants to stop the flow of economic migrants. Mr Straw knows well that most of the several hundred thousand people awarded ‘right of abode’ status during his time in office have come explicitly for economic reasons. Here Mr Straw is talking about migrants who come to the UK purely to exploit the social security system, while using a term which traditionally refers to an entirely different group.
Barbara Roche, the present Government’s minister responsible for migration issues, realises that such language has served to obfuscate the line between desirable, useful migrants and social security abusers. In a speech in July 2000, Ms Roche discussed the distinction between unjustified asylum seekers and genuine economic migrants, obliquely admitting previous failures to distinguish important differences between the two when she stated that:
“Our thinking on these issues is now developing” 3
This shows a willingness to accept what is already true: Britain accepts some types of economic migrants with open arms. So long as the term ‘economic migrant’ is used to denote both welfare seekers and job seekers, debating British migration policy will always produce confusion. For the purposes of this paper, the wider, and much more traditional definition of economic migrants will be used, as a term for those who migrate with the intention of bettering themselves economically. When the discussion turns to people who claim asylum falsely to gain welfare benefits, they will be referred to directly as such.
The paper proceeds as follows. Section two of this paper deals with the evidence that many potentially productive migrants are not admitted to the UK, and details the legislation and procedures that ensure that they cannot come here. Section three addresses the reason why such restrictions are bad for British citizens and businesses. The fourth and final section proposes changes that could improve the migration system in the UK.
2 – High Fences
The argument that Britain’s migration policies are too illiberal seems strange when confronted by the raw figures. In 1999 97 100 people were accepted for settlement in the UK4. This was the highest ever gross influx in a single year, and was equivalent to a total population increase of over 0.1%. Additionally, 76 000 were admitted as work permit holders. 86 million more were allowed in as holiday makers. The average yearly acceptances for settlement in the UK total over 60 000.
These sizeable figures hide the composition of those granted the right of abode in the UK. As figure 1 shows, only 7 per cent of the total granted residency permission were admitted under the government category of “Employment and other own right”. Nearly ten times more were granted acceptance for settlement as spouses or family members of existing British citizens. The remaining 23 per cent consisted of asylum seekers whose cases were accepted by the immigration and asylum authorities. This shows that the vast majority of migrants who are being granted the right to live in the UK are either doing so under the aegis of family re-unification legislation, or because they have established their right to asylum. This shows that the majority of migrants who are admitted to the UK are not primary migrants, which is to say migrants who come in search of work as their highest priority.
A Short History of British Migration Policy
To understand why it is that such an unusual mixture of migrants are granted the right of abode in the UK, we have to examine the history of British migration policy. For most of the existence of the British Empire, British subjects of any race were permitted to migrate to the United Kingdom for the purpose of living or working. This right was enshrined in the 1948 British Nationality Act, which defined two groups of UK citizens, Commonwealth and ‘UK and colonies’ nationals. Both were given the same rights to live and work in the UK.
In 1962 the Immigration Act was introduced to stem the flow of migrants from commonwealth countries. The government had been alarmed about migration since the 1958 race riots in Notting Hill, which starkly exposed the ethnic tensions present in British society. When the numbers of economic migrants began to rise steeply in 1960, the government felt it had to act.
UK passport holders (including citizens of countries which were still officially British colonies) were still awarded full rights of residency, but commonwealth citizens were subject to quotas if they wished to migrate to the UK. The quota in 1962 was 51 000 per year, a little less than the actual migration figure of 66 000 in 1961. Shortly afterwards the Labour government of 1964 drastically reduced the vouchers awarded yearly to only 4700. This virtually closed primary migration as a possibility for most commonwealth members.
The project of closing primary migration channels was not finished in 1964. Despite the numerous policy changes, one major door open for economic migration from the former British empire had been left open: the remaining British Colonies. Many citizens of British colonies were in possession of British passports, and still had the right to migrate to the UK. This presented an open door to non-white colonials which the government was keen to close. The 1968 Commonwealth Immigration Act did so by introducing the concept of belonging into British migration law. Only those who were born in the UK, or who had a parent or grandparent born in the UK were allowed to move here. This, as has been widely noted, favoured white migrants who were far more likely to have been raised in British born families than non-whites.
A mere three years later, yet another major immigration law was passed, the 1971 Immigration Act. This modified the concept of ‘belonging’ into a more genetic sounding, but ultimately similar, idea of ‘patriality’. It furthered the task of all immigration policy since the 1960s, to limit the number of people who had right by birth of abode in the UK. This Act did not last. Migration policy was changed, yet again, by the British Nationality Act in 1981, the Immigration Act of 1971 having suffered criticism from the European Human Rights Commission for its apparent bias towards whites. Five new forms of British citizenship were introduced, but of the five only one, ‘British Nationality’ (awarded to UK born citizens and immediate descendants) gave a right of abode in the UK. The others simply differentiated classes of people who despite connections were not granted the all-important right to live or work in the UK. The 1981 Act also further tightened who was granted British nationality by changing the qualification from grandparental nationality to parental nationality, making it even less likely that commonwealth citizens would be granted the right of abode in the UK.
The Consequences
The most important consequences of the above changes are the following.
First, the only types of non-UK passport holding migrants formally allowed to work or reside in the UK became either family members and spouses of UK citizens, or certain tightly controlled categories of workers. Work acceptances cover specific and tightly defined fields, such as investors who bring at least £750 000 of their own money, clergymen, entertainers, airline pilots, domestic servants, journalists and – most recently – innovators who promise to set up businesses.
The second major consequence of the changes is that the door was closed on workers who are not highly skilled. This applied both for awarding temporary and permanent permission to work in the UK. Medium, low and unskilled workers have no reason to expect that they can work and live in the UK, unless they enter under the seasonal agricultural workers scheme, which is fixed at a maximum of 10 000 workers per year. They are, to all intents and purposes, not wanted by the government and not allowed in. The DFEE Overseas Labour Service notes curtly that:
“We do not issue work permits for jobs at manual, craft, clerical, secretarial or similar levels, or for domestic work, such as nannies or housekeepers.” 5
The work permits scheme is the only mechanism which allows companies to sponsor migrants that they want to employ. However, the strict procedure guidelines ensure that this is only worthwhile for relatively highly skilled, highly paid jobs required by firms that are large enough to handle the procedures required to obtain even a single work permit. It is recognised informally within the DFEE that work permits are not awarded for jobs worth less than about £20 000 per year6 , and the DFEE’s advice suggests that applicants should have at least a university degree plus two years of well paid employment in certain sectors behind them. The only exception is the key workers scheme which is designed to allow unusually skilled workers, such as sheep-shearers, access to the UK job market for no more than 36 months, even though they may not have high paying positions or academically advanced qualifications.
This does not realistically provide a channel for many medium and low skilled workers. Immigration lawyers report that the legal costs to businesses of processing a single work permit application are about £500-850 plus VAT. On top of this there are the extra expenses of advertising to see if there is a ‘native’ worker who can fill the job instead7 ( between £700 and £1000 ), plus the even greater costs of administering and running an entire vetting and interviewing process. For anyone less than a very highly skilled worker these barriers stand as formidable obstacles to potential employers, and to medium and low skilled migrants. Many employers, wishing to avoid these costs, introduce a vicious circle to their employment procedures by making a work permit a prerequisite for applying for a job that is required to gain that permit.
The third, and most visible effect of the closure of low and medium skill migration channels is that the numbers of asylum seekers without legitimate claim to refugee status has soared, peaking at over 70% of total applicants in late 1999, pushing migration as a whole back into the public eye. The rise in unjustified asylum seekers can be attributed to a number of different factors, including the simple spread of information concerning the availability of welfare through the asylum system. However, there is no doubt that the combination of tight migration policies, with high labour demand and relatively high wages makes Britain a prime target for migrants who cannot get into the UK through legitimate channels. Minister of State Barbara Roche recognized this recently when she stated that,
“If no other opportunities exist, asylum will increasingly be seen as the only route for migration”8
In this statement, the minister recognised a fairly simple economic phenomenon. Unemployment in most other European countries is relatively high. In the UK, low unemployment rates and high employment rates reflect high demand for labour. It is not surprising that with the UK economy giving off such strong signals about its desire for labour that migrants have started to use the only system open to them, asylum.
Figure 2 on the next page indicates that, broadly speaking, asylum applications have been inversely correlated with unemployment since the mid 1980s, when asylum figures first started being recorded. In other words, as demand for labour has risen, so have the number of applications for asylum. Although there are many other factors which influence numbers of people claiming asylum, especially major civil crises in countries which provoke floods of refugees, the correlation is sufficiently clear to imply cause.
It is traditional to blame the increase in asylum applicants on rising social security benefits. This cannot explain the figure 2 , though. Social security benefits for asylum seekers have not changed dramatically over time, except when they were made considerably less generous in 1996, via the Asylum and Immigration Act of that year. It was also in 1996 that we see the numbers of asylum applications start to rise rapidly, and continue to rise for the next three years. This is the exact opposite result we would expect to see if we believe that asylum seeking levels have risen in response to an overly generous welfare state. Over the same three year period UK unemployment fell to the lowest rate for over 20 years, which would seem to be a far stronger incentive for any non-genuine asylum seeker than benefits which were actually being cut.
It must be added that genuine refugees, when fleeing persecution, may very well respond to conditions in labour markets, and so choose to escape to countries where their chances of rebuilding their lives are improved. Figure 2 is not intended to show that most asylum applicants are unjustified in their claims.
It has recently been suggested that the existing migration systems, though widely seen as a ‘closed door’ are in fact already sufficiently open to serve the UK while protecting it against the envy of less happier lands. Conservative MP Ann Widdecombe stated that she sees:
“No reason to relax the existing controls on immigration. If we have a shortage of skills the existing work-permit scheme seems to function perfectly well.”9
The above examples concerning skill levels and the cost of obtaining work permits indicate that this is not the case for many workers. The next section expands in more detail on how Britain is suffering from insufficient flexibility in its migration systems.
3 – Why Economic Migrants are Valuable, and What We are Missing
Chancellor of the Exchequer Gordon Brown has declared that there are about one million unfilled jobs in the UK at the time of writing, at the same time as the nation still has an official unemployment rate of 3.9%10. Furthermore, the BBC reports that
“Literacy, numeracy and skills levels in the UK are so poor that a quarter of employers struggle to fill job vacancies “11
This indicates that there are a large number of jobs available in the UK which are not filled for two reasons, either because there is a shortage of appropriately skilled workers in the area where there is demand, or because there are not enough people who desire to do those jobs. These jobs are not by any means all highly skilled, new technology related employment, although many of them undoubtedly are IT related. The Economist noted that British farmers report a shortage of labour capable or willing even to pick lettuces12, while restaurants and service industries around the country struggle to fill jobs due to the tight labour market. The National Farmers Union is lobbying for more migrant labour, without which it says many full time British farmers’ jobs are under threat. In July 2000 the CBI, the voice of many manual industries, reported that skill shortages were being felt by 16 per cent of its members, a three year high.
Despite the shortfall of willing and able applicants for jobs in the UK, work permit policy is still framed by the idea that the companies must prove that there is no UK citizen who could do the job instead. This appears to be a hangover from the era when the 1981 British Nationality Act was drafted, at which time unemployment was a much more severe problem than it is now, primarily due to labour market inflexibility.
The present government has shown signs of recognising that existing migration policies are failing Britain. A new category of skilled worker eligible to work in the UK has been added, the ‘Innovator’, to reflect the need for entrepreneurs who may not have much of their own capital behind them, and more announcements are in the pipeline. Nevertheless, attempts to open the debate face resistance, the most high profile obstacle being the following argument.
Britons before Indians
The primary argument against migration reforms is that instead of importing migrants, we should spend our time and money training our own under-skilled population. This seductive idea (summed up in the German nationalist campaign slogan “Children before Indians”), is fallacious.
First, it ignores important time considerations. If there is a vacancy that requires an unavailable worker today, it is of little use to tell the company with the vacancy that someone will be specially trained up, and that they will be ready to work in a few months, or a few years time. This costs the company, which in turn passes the costs onto the British consumer. Far from being a help to native Britons this policy would result in their suffering from inferior, and higher cost services.
The second reason why the ‘train the Britons first’ argument is flawed, is that working migrants pay taxes which can be used to train natives13. If working migrants are allowed into the UK then they will pay additional taxes which are not paid at present. Without those tax revenues, there will be less money to spend on public services, including education, in the first place. Again, the argument leads to a counterproductive outcome.
The final nail in the coffin of this theory is the fact that there are many jobs which do not require great skill, but which few Britons are willing to take up. Sectors like picking fruit or cleaning office buildings already use large amounts of migrant labour, primarily because finding native Britons willing to do this work at any reasonable wage is impossible. Few urban Britons who live on welfare would accept hard, manual agricultural labour even if the wages were better than their benefits.
There are more, important reasons why the UK would benefit from a more intelligent and more liberal migration system. Two of the major advantages are discussed below.
Self-selection and motivation
Most migrants come from a self-selected group of unusually motivated and organised individuals. People who are idle or disorganised are unlikely to go through the troublesome, expensive and exhausting procedures required to migrate. Historically this has led to migrant communities being unusually motivated in the work sphere. At one end of the spectrum this has led to 13-14% of Indians in the UK becoming part of the ‘professional classes’, nearly twice the figure for white male Britons14. Members of British ethnic minorities are, taken together, more likely to be entrepreneurs than the white population15. Even amongst the figures normally cited to highlight the existence of serious deprivations amongst ethnic minorities in the UK, there is evidence of the self-selection of migrant families. For example, Bangladeshi children achieve the lowest standard of school results in the country. However, their attainment levels at GCSE have doubled in 6 years, indicating the fastest growth in education standards for any ethnic group in Britain16. In the 2000 A-Level results, Bangladeshi children again showed the fastest improvements, underlining the fact that even if a migrant who comes to the UK is unskilled, it does not mean for a moment that they or their families are lacking in a work ethic. Indeed the opposite seems to be true. Writing about the American experience with migrants, Julian Simon wrote that:
“Compared to natives, their rate of participation in the labour force is higher, they tend to save more, they apply more effort during working hours, and they have a higher propensity to start new businesses and to be self-employed.” 17
The benefits of cultural interaction and assimilation
The second advantageous aspect of allowing economic migrants into the UK is the cultural assets they bring with them, whether they be cuisine, music, science, literature, forms of social organisation or actual objects and resources. Britain has benefited an incalculable amount from imported practices, from chicken tikka masala ( purportedly Britain’s most consumed dish ) to democracy itself. The dangers presented by nations which legislate to enforce cultural purity hardly need repeating. Britain is not about to go down such a path, but the lack of open migration channels means an inevitable retardation of cultural assimilation, with potential social and economic costs. The missed opportunities themselves are impossible to calculate, but we need only to note that the founder of Intel was a Hungarian born migrant to the US, or that Picasso received inspiration from African masks, to see the varying and potentially enormous opportunity costs that hindering cultural interaction could have. Had we had such strict migration policies in the past as we do today we can be sure that Britain would be a less rich place than it is. Our primary religion, much of our language, our beer and favourite foods all have strong foreign elements which could have been excluded by our current migration policies. And then there is Marks and Spencer.
Economic migrants are desirable primarily because they fill jobs which employers want to be filled. Britain is in an unusual period where the number of jobs is relatively high compared with the active labour force. Migration laws ought to reflect the desire of British companies to be able to employ more migrants for the good of themselves, their shareholders, their customers, and (of course), the job seeking migrants. Second, migrants who come to the UK tend to be willing to work hard, are unusually entrepreneurial and to take up employment that Britons are not willing to. Lastly, migrants are desirable because they bring social and cultural practices which challenge stagnation in our private and public lives. They bring new ways of approaching problems and of entertaining ourselves which serve to make our lives more vigorous and interesting.
4 – Changes
The migration system needs reforming. It is a system of two parts, the first being the normal day-to-day migration controls, the second the asylum system which exists to give sanctuary to those fleeing persecution. The government has shown signs that it realises that the issues surrounding the two have become confused. It is seeking to separate them in order to instigate changes, particularly to the non-asylum migration channels. Barbara Roche stated that:
“In ensuring that we crack down wherever necessary on misuse, we must not lose sight of the bigger picture. Many immigrants….have been very successful here, bringing economic benefits to Britain as a whole” . 18
Separating the two systems must not be done unthinkingly. Britain cannot have two separate migration systems which do not carefully interlock. The wrong incentive from one system will drive people from one to the other. This is exactly what has been happening over the last decade as potential economic migrants have discovered that the asylum system can be used as a successful means of entry. There is a danger that reforms which do not take into account the interrelated nature of the systems will just create a different set of unwanted incentives.
In the following sections a pair of blueprints are sketched out which are designed with the question constantly in mind: “Will this system make the right people use the right channel?”
Reforming the economic migration system
As seen above, the work permit scheme as it stands is flawed. It is targeted, soviet style, at workers with skills that the Home Office bureaucracy decides are ‘required’ for British prosperity. But necessary skills in the work place are changing so fast that companies have found it essential to implement continual training schemes just to keep their employees up to date with current technologies. In the light of this the government list of approved computer skills is laughable both in content and conceptualisation. The list is lacking PHP, Autocad and SNA, all major technologies, and has no specific mention that web designers are needed the UK, even though the page the list is on itself contains a broken link.19
One of the most talked about proposals for migration reform, the introduction of a points based system similar to Canada, suffers from the same problems as the existing British system. In Canada an applicant is awarded points according to the content of their application, such as points for having a relative in the country, or being a computer programmer. If they receive enough points, the applicant gains permission to live and work in Canada. However, this method suffers from the same type of unresponsiveness to actual demand associated with bureaucratic systems selecting useful skills. This is probably the most serious weakness with the points system: that in one important way it too closely resembles the existing UK work permit system.
The question of skills selection is not just one of choosing the right technology to add to the list. There is an unfounded bias against low and medium skilled workers in our existing migration policy, even though they are the lifeblood of the modern services sector. While they are not as purely productive as IT workers this does not mean that they are not in demand from many businesses without the glamorous dot.com status.
There is simply no way that the civil service can efficiently declare what workers the UK needs. Indeed the only people who know what British companies and British customers need are the companies and their markets. The shortages discussed above are the most visible manifestation of this failure. The opportunity costs of the existing permit systems are great, but can never be calculated.
So how should this system be reformed? One solution would be for companies to be able to submit to an electronic system either the name of a specific person, or to contract an agency that would find and then submit the name of a potential employee to the same system. Applicants for migration would be able to apply for permanent or temporary work permits by having their details registered. The moment a company expresses a desire for a particular worker, the worker ought to be awarded an appropriate work permit. Job agencies would be free to act internationally between employers and labour markets, which could make obtaining the work permit transparent to both parties. The system would be non-discretionary and based on a simple demand-award system. If there was no demand, applicants could still apply and have their applications held in a queue until demand for those skills emerges. This would make the life of work placement agencies easier as they could search the waiting list for appropriately skilled workers, and advertise them to businesses.
The duration of work permits ought to be somewhat longer than the expected employment duration of the worker. This would give workers time to new seek work if their employment came to an end. If a new job were found, or if they started one themselves, their permit would be extended. If they remained persistently unemployed, their permit would be revoked.
Of course, practical political pressures will demand that the government manifests a control over the numbers of economic migrants permitted entry to the UK. The system sketched out above allows this to be achieved through a numbers quota, to be set according to political acceptability. When the quota has been used up, new applicants would be added to the queue, until the next period for the quota begins, or as Britons or workers leave and formally give up their rights of abode.
This system would allow British governments to display a control over workers’ rights and pay levels, both highly sensitive issues. No worker could be demanded by a business, for example, where pay offered is below the minimum wage. If politically necessary, this could also act as a way of preventing British businesses from using the system to replace native workers with cheaper substitutes; an almost unknown phenomenon, but one which provokes great public fear. Additionally, a family re-unification scheme could be run along side the new system, very much along the rules of the existing one.
Reforming the Asylum System
Reforming the work permit system still leaves the question of asylum. There is little doubt that given more flexible migration channels many of those who seek asylum without firm grounds for doing so, would change their approach and apply legitimately, thus avoiding the penalties associated with being discovered as a non-refugee. Nevertheless, unless other policies are changed, the incentive for those purported migrants who want only to live on welfare will remain unchanged. If only for the sake of the public image of migrants as a whole, this group has to be as firmly discouraged as possible.
There is a humane way of dealing with this issue that does not require the currently proposed reassessment of the 1951 UN Convention. Benefits for asylum seekers might be limited in length to no more than a few months, and made conditional on seeking work. Welfare to work schemes have been embraced successfully in a number of western states. Since subgroups of asylum seekers who want to live off benefits rather than work are a form of welfare dependency problem, they can and should be dealt with in a similar way to policies designed for natives.
Consequently the ban on employment for most of those in the process of seeking asylum should be dropped. Those who are granted asylum need not have wasted their time and tax payers’ money waiting for work permits (including many of the estimated 1000 asylum seeking doctors who sit idle in London at the moment20). Those whose asylum claims are found wanting, but who still find productive employment, could also be converted to normal ‘economic migrant’ status but hit with a punitive income tax rate for a fixed period of time. This would act as a disincentive to use the asylum channel rather than the newly reformed economic migration channels, while avoiding the absurd waste of labour, benefits and tax revenues that the current asylum system entails. Those who fail on both judgement and employment counts could be struck off welfare and deported. The recent proposals to remove the rights to employment from those asylum seekers who have gained them would serve little more than to push even more asylum seeking employment underground, and out of the taxation system.
Conclusion
There are many aspects of the immigration debate which are purposefully left out of this discussion paper in the interests of brevity and clarity. The most important omission is the question: “What harm, if any, do migrants do to the UK?”. This question has not been raised because this paper is aimed at reforming government policy, and the government does not and will not say what it fears from an overly generous migration system.
Bypassing questions of possible harm is less important a problem than it initially seems. Whatever the potential costs of migration may be, they will not actually be the reason that the government decides to set restrictions at a certain level. Instead public opinion that remains strongly hostile to most migration will be the primary restraint. The government is never likely to have to ask seriously “What do migrants mean for housing or unemployment?” because public opinion is certain to keep permitted numbers below levels at which these issues become relevant. A further paper, to follow this one, will explore exclusively the objections to migration and will be aimed at rectifying press and public misperceptions concerning migration, which the government and civil service currently take as given.
What this paper has sought to demonstrate is that there is a pressing need for migration reforms, and has sketched out a system which could replace existing policies. It has been shaped to improve the existing system while recognising the delicate political realities surrounding migration as an issue. Hopefully careful improvements to the migration system will themselves change the nature of those political realities, and perhaps allow more frank debate than is possible at present.
Endnotes
1 The views expressed in this working paper are those of the author and not of the IEA (which has no corporate view), its Directors, Advisors or Trustees.
IEA Working Papers have not been subject to the same rigorous peer review process to which all other IEA papers are subject. It is the purpose of these papers to stimulate debate on issues of contemporary import; the author is grateful for comments, please contact him at tsteinberg@iea.org.uk.
2 Commons Hansard, 22 February 1999, pt12.
3 Alan Travis, “Migrants with skills may be welcomed”, The Guardian, 22 July 2000.
4 All figures in this paragraph are from HMSO Control of Immigration: Statistics United Kingdom, Second half and year 1999.
5 http://www.dfee.gov.uk/ols/html/bc/bceligib.htm#ebook1
6 In 1997 UK median wage was £14,020 per year, Social Trends 1997, Office of National Statistics.
7 It is not required to advertise for certain employment fields such as medicine and nursing.
8 Barbara Roche speech in Paris, 21 July 2000, p10.
9 Ann Widdecombe quoted by David Bamber, “Labour to invite 100,000 foreigners a year into UK”, The Daily Telegraph, 3rd September 2000.
10 http://news2.thls.bbc.co.uk/hi/english/business/newsid%5F751000/751963.stm
11 http://news.bbc.co.uk/hi/english/education/newsid_807000/807053.stm
12 The Economist, ‘A Continent on the Move’, 6 May 2000.
13 Some commentators have noted that working migrants must actually contribute more to the tax coffers than natives because they do not bring pension claiming relatives with them. Unfortunately, in the UK there are no studies with which to compare this theory.
14 Social focus on ethnic minorities, ONS, p12.
15 Office of National Statistics, Labour Market Trends, June 2000, p253.
16 All figures in this paragraph are from “Social Inequalities 2000” from the ONS.
17 Julian Simon, “The Economic Consequences of Immigration into the United States”, Ch 17.
18 Barbara Roche, speech, ‘UK Migration in a Global Economy’, p8.
19 http://www.dfee.gov.uk/ols/html/bc/bcshort.htm
20 The 1000 doctor figure is a Refugee Council estimate. Foreign doctors would, of course, have to be trained and certified to British standards.
Fullscreen Mode
This paper has been written at a time when the issue of migration is more important in British politics than it has been for nearly 20 years. In September 2000 the Labour Government indicated formally that it was in the process of reviewing British migration policy, and asked for a public debate. Although this paper was being researched well in advance of this announcement, it now forms part of that debate.
Reforming British Migration Policy is about existing policy and what reforms could be enacted to improve current migration systems; it will be followed shortly by a paper which addresses common fears about migration, and which shows that most are of doubtful justification.
It is notable that despite the wealth of academic material concerned with certain aspects of migration in the UK, particularly the social conditions of ethnic minorities, many of the biggest immigration questions are under-researched. Issues such as the historical impact of migration on employment, welfare and growth in the UK have surprisingly little written on them, almost certainly because the process of gathering data for such surveys is extraordinarily expensive, and difficult to interpret into meaningful results.
As a result much of the information on which this paper is based is gathered from government sources rather than academic research. Hopefully, the present debate will have the side effect of stimulating larger scale research into migration to the UK.
Abstract
This paper argues that British migration laws are skewed against economic migrants in a way which is harmful to Britain. Policies designed in a different economic era dictate who is allowed to live and work in the UK, and do so in a manner which is unresponsive to the desires of Britons and British businesses. The existing migration systems also create incentives to abuse the asylum process. A proposal is made for a work permit system which is market driven, but which retains control mechanisms for government.
1 – What are ‘economic migrants’?
‘Economic migrant’ is a term employed in two significantly different ways. In an academic context, an economic migrant is anyone who migrates, either within a state, or from one nation to another, for economic reasons. However, in current press and political discourse, an economic migrant has become someone who claims asylum falsely, with the aim of living a life of ease at the expense of their host state’s welfare system.
By confusing these two meanings, intentionally or otherwise, writers and commentators who are against migration have managed to tar the former category with the same brush as the latter.
In a typical example of the current confusion over migrants, Jack Straw told the House of Commons that:
“We must be able to provide support to those in genuine need, but we must do so in a way that minimises the incentive to economic migrants who undermine public support for genuine refugees.” 2
In this case Mr Straw cannot have been talking about economic migrants as correctly defined, because he indictes that he wants to stop the flow of economic migrants. Mr Straw knows well that most of the several hundred thousand people awarded ‘right of abode’ status during his time in office have come explicitly for economic reasons. Here Mr Straw is talking about migrants who come to the UK purely to exploit the social security system, while using a term which traditionally refers to an entirely different group.
Barbara Roche, the present Government’s minister responsible for migration issues, realises that such language has served to obfuscate the line between desirable, useful migrants and social security abusers. In a speech in July 2000, Ms Roche discussed the distinction between unjustified asylum seekers and genuine economic migrants, obliquely admitting previous failures to distinguish important differences between the two when she stated that:
“Our thinking on these issues is now developing” 3
This shows a willingness to accept what is already true: Britain accepts some types of economic migrants with open arms. So long as the term ‘economic migrant’ is used to denote both welfare seekers and job seekers, debating British migration policy will always produce confusion. For the purposes of this paper, the wider, and much more traditional definition of economic migrants will be used, as a term for those who migrate with the intention of bettering themselves economically. When the discussion turns to people who claim asylum falsely to gain welfare benefits, they will be referred to directly as such.
The paper proceeds as follows. Section two of this paper deals with the evidence that many potentially productive migrants are not admitted to the UK, and details the legislation and procedures that ensure that they cannot come here. Section three addresses the reason why such restrictions are bad for British citizens and businesses. The fourth and final section proposes changes that could improve the migration system in the UK.
2 – High Fences
The argument that Britain’s migration policies are too illiberal seems strange when confronted by the raw figures. In 1999 97 100 people were accepted for settlement in the UK4. This was the highest ever gross influx in a single year, and was equivalent to a total population increase of over 0.1%. Additionally, 76 000 were admitted as work permit holders. 86 million more were allowed in as holiday makers. The average yearly acceptances for settlement in the UK total over 60 000.
These sizeable figures hide the composition of those granted the right of abode in the UK. As figure 1 shows, only 7 per cent of the total granted residency permission were admitted under the government category of “Employment and other own right”. Nearly ten times more were granted acceptance for settlement as spouses or family members of existing British citizens. The remaining 23 per cent consisted of asylum seekers whose cases were accepted by the immigration and asylum authorities. This shows that the vast majority of migrants who are being granted the right to live in the UK are either doing so under the aegis of family re-unification legislation, or because they have established their right to asylum. This shows that the majority of migrants who are admitted to the UK are not primary migrants, which is to say migrants who come in search of work as their highest priority.
A Short History of British Migration Policy
To understand why it is that such an unusual mixture of migrants are granted the right of abode in the UK, we have to examine the history of British migration policy. For most of the existence of the British Empire, British subjects of any race were permitted to migrate to the United Kingdom for the purpose of living or working. This right was enshrined in the 1948 British Nationality Act, which defined two groups of UK citizens, Commonwealth and ‘UK and colonies’ nationals. Both were given the same rights to live and work in the UK.
In 1962 the Immigration Act was introduced to stem the flow of migrants from commonwealth countries. The government had been alarmed about migration since the 1958 race riots in Notting Hill, which starkly exposed the ethnic tensions present in British society. When the numbers of economic migrants began to rise steeply in 1960, the government felt it had to act.
UK passport holders (including citizens of countries which were still officially British colonies) were still awarded full rights of residency, but commonwealth citizens were subject to quotas if they wished to migrate to the UK. The quota in 1962 was 51 000 per year, a little less than the actual migration figure of 66 000 in 1961. Shortly afterwards the Labour government of 1964 drastically reduced the vouchers awarded yearly to only 4700. This virtually closed primary migration as a possibility for most commonwealth members.
The project of closing primary migration channels was not finished in 1964. Despite the numerous policy changes, one major door open for economic migration from the former British empire had been left open: the remaining British Colonies. Many citizens of British colonies were in possession of British passports, and still had the right to migrate to the UK. This presented an open door to non-white colonials which the government was keen to close. The 1968 Commonwealth Immigration Act did so by introducing the concept of belonging into British migration law. Only those who were born in the UK, or who had a parent or grandparent born in the UK were allowed to move here. This, as has been widely noted, favoured white migrants who were far more likely to have been raised in British born families than non-whites.
A mere three years later, yet another major immigration law was passed, the 1971 Immigration Act. This modified the concept of ‘belonging’ into a more genetic sounding, but ultimately similar, idea of ‘patriality’. It furthered the task of all immigration policy since the 1960s, to limit the number of people who had right by birth of abode in the UK. This Act did not last. Migration policy was changed, yet again, by the British Nationality Act in 1981, the Immigration Act of 1971 having suffered criticism from the European Human Rights Commission for its apparent bias towards whites. Five new forms of British citizenship were introduced, but of the five only one, ‘British Nationality’ (awarded to UK born citizens and immediate descendants) gave a right of abode in the UK. The others simply differentiated classes of people who despite connections were not granted the all-important right to live or work in the UK. The 1981 Act also further tightened who was granted British nationality by changing the qualification from grandparental nationality to parental nationality, making it even less likely that commonwealth citizens would be granted the right of abode in the UK.
The Consequences
The most important consequences of the above changes are the following.
First, the only types of non-UK passport holding migrants formally allowed to work or reside in the UK became either family members and spouses of UK citizens, or certain tightly controlled categories of workers. Work acceptances cover specific and tightly defined fields, such as investors who bring at least £750 000 of their own money, clergymen, entertainers, airline pilots, domestic servants, journalists and – most recently – innovators who promise to set up businesses.
The second major consequence of the changes is that the door was closed on workers who are not highly skilled. This applied both for awarding temporary and permanent permission to work in the UK. Medium, low and unskilled workers have no reason to expect that they can work and live in the UK, unless they enter under the seasonal agricultural workers scheme, which is fixed at a maximum of 10 000 workers per year. They are, to all intents and purposes, not wanted by the government and not allowed in. The DFEE Overseas Labour Service notes curtly that:
“We do not issue work permits for jobs at manual, craft, clerical, secretarial or similar levels, or for domestic work, such as nannies or housekeepers.” 5
The work permits scheme is the only mechanism which allows companies to sponsor migrants that they want to employ. However, the strict procedure guidelines ensure that this is only worthwhile for relatively highly skilled, highly paid jobs required by firms that are large enough to handle the procedures required to obtain even a single work permit. It is recognised informally within the DFEE that work permits are not awarded for jobs worth less than about £20 000 per year6 , and the DFEE’s advice suggests that applicants should have at least a university degree plus two years of well paid employment in certain sectors behind them. The only exception is the key workers scheme which is designed to allow unusually skilled workers, such as sheep-shearers, access to the UK job market for no more than 36 months, even though they may not have high paying positions or academically advanced qualifications.
This does not realistically provide a channel for many medium and low skilled workers. Immigration lawyers report that the legal costs to businesses of processing a single work permit application are about £500-850 plus VAT. On top of this there are the extra expenses of advertising to see if there is a ‘native’ worker who can fill the job instead7 ( between £700 and £1000 ), plus the even greater costs of administering and running an entire vetting and interviewing process. For anyone less than a very highly skilled worker these barriers stand as formidable obstacles to potential employers, and to medium and low skilled migrants. Many employers, wishing to avoid these costs, introduce a vicious circle to their employment procedures by making a work permit a prerequisite for applying for a job that is required to gain that permit.
The third, and most visible effect of the closure of low and medium skill migration channels is that the numbers of asylum seekers without legitimate claim to refugee status has soared, peaking at over 70% of total applicants in late 1999, pushing migration as a whole back into the public eye. The rise in unjustified asylum seekers can be attributed to a number of different factors, including the simple spread of information concerning the availability of welfare through the asylum system. However, there is no doubt that the combination of tight migration policies, with high labour demand and relatively high wages makes Britain a prime target for migrants who cannot get into the UK through legitimate channels. Minister of State Barbara Roche recognized this recently when she stated that,
“If no other opportunities exist, asylum will increasingly be seen as the only route for migration”8
In this statement, the minister recognised a fairly simple economic phenomenon. Unemployment in most other European countries is relatively high. In the UK, low unemployment rates and high employment rates reflect high demand for labour. It is not surprising that with the UK economy giving off such strong signals about its desire for labour that migrants have started to use the only system open to them, asylum.
Figure 2 on the next page indicates that, broadly speaking, asylum applications have been inversely correlated with unemployment since the mid 1980s, when asylum figures first started being recorded. In other words, as demand for labour has risen, so have the number of applications for asylum. Although there are many other factors which influence numbers of people claiming asylum, especially major civil crises in countries which provoke floods of refugees, the correlation is sufficiently clear to imply cause.
It is traditional to blame the increase in asylum applicants on rising social security benefits. This cannot explain the figure 2 , though. Social security benefits for asylum seekers have not changed dramatically over time, except when they were made considerably less generous in 1996, via the Asylum and Immigration Act of that year. It was also in 1996 that we see the numbers of asylum applications start to rise rapidly, and continue to rise for the next three years. This is the exact opposite result we would expect to see if we believe that asylum seeking levels have risen in response to an overly generous welfare state. Over the same three year period UK unemployment fell to the lowest rate for over 20 years, which would seem to be a far stronger incentive for any non-genuine asylum seeker than benefits which were actually being cut.
It must be added that genuine refugees, when fleeing persecution, may very well respond to conditions in labour markets, and so choose to escape to countries where their chances of rebuilding their lives are improved. Figure 2 is not intended to show that most asylum applicants are unjustified in their claims.
It has recently been suggested that the existing migration systems, though widely seen as a ‘closed door’ are in fact already sufficiently open to serve the UK while protecting it against the envy of less happier lands. Conservative MP Ann Widdecombe stated that she sees:
“No reason to relax the existing controls on immigration. If we have a shortage of skills the existing work-permit scheme seems to function perfectly well.”9
The above examples concerning skill levels and the cost of obtaining work permits indicate that this is not the case for many workers. The next section expands in more detail on how Britain is suffering from insufficient flexibility in its migration systems.
3 – Why Economic Migrants are Valuable, and What We are Missing
Chancellor of the Exchequer Gordon Brown has declared that there are about one million unfilled jobs in the UK at the time of writing, at the same time as the nation still has an official unemployment rate of 3.9%10. Furthermore, the BBC reports that
“Literacy, numeracy and skills levels in the UK are so poor that a quarter of employers struggle to fill job vacancies “11
This indicates that there are a large number of jobs available in the UK which are not filled for two reasons, either because there is a shortage of appropriately skilled workers in the area where there is demand, or because there are not enough people who desire to do those jobs. These jobs are not by any means all highly skilled, new technology related employment, although many of them undoubtedly are IT related. The Economist noted that British farmers report a shortage of labour capable or willing even to pick lettuces12, while restaurants and service industries around the country struggle to fill jobs due to the tight labour market. The National Farmers Union is lobbying for more migrant labour, without which it says many full time British farmers’ jobs are under threat. In July 2000 the CBI, the voice of many manual industries, reported that skill shortages were being felt by 16 per cent of its members, a three year high.
Despite the shortfall of willing and able applicants for jobs in the UK, work permit policy is still framed by the idea that the companies must prove that there is no UK citizen who could do the job instead. This appears to be a hangover from the era when the 1981 British Nationality Act was drafted, at which time unemployment was a much more severe problem than it is now, primarily due to labour market inflexibility.
The present government has shown signs of recognising that existing migration policies are failing Britain. A new category of skilled worker eligible to work in the UK has been added, the ‘Innovator’, to reflect the need for entrepreneurs who may not have much of their own capital behind them, and more announcements are in the pipeline. Nevertheless, attempts to open the debate face resistance, the most high profile obstacle being the following argument.
Britons before Indians
The primary argument against migration reforms is that instead of importing migrants, we should spend our time and money training our own under-skilled population. This seductive idea (summed up in the German nationalist campaign slogan “Children before Indians”), is fallacious.
First, it ignores important time considerations. If there is a vacancy that requires an unavailable worker today, it is of little use to tell the company with the vacancy that someone will be specially trained up, and that they will be ready to work in a few months, or a few years time. This costs the company, which in turn passes the costs onto the British consumer. Far from being a help to native Britons this policy would result in their suffering from inferior, and higher cost services.
The second reason why the ‘train the Britons first’ argument is flawed, is that working migrants pay taxes which can be used to train natives13. If working migrants are allowed into the UK then they will pay additional taxes which are not paid at present. Without those tax revenues, there will be less money to spend on public services, including education, in the first place. Again, the argument leads to a counterproductive outcome.
The final nail in the coffin of this theory is the fact that there are many jobs which do not require great skill, but which few Britons are willing to take up. Sectors like picking fruit or cleaning office buildings already use large amounts of migrant labour, primarily because finding native Britons willing to do this work at any reasonable wage is impossible. Few urban Britons who live on welfare would accept hard, manual agricultural labour even if the wages were better than their benefits.
There are more, important reasons why the UK would benefit from a more intelligent and more liberal migration system. Two of the major advantages are discussed below.
Self-selection and motivation
Most migrants come from a self-selected group of unusually motivated and organised individuals. People who are idle or disorganised are unlikely to go through the troublesome, expensive and exhausting procedures required to migrate. Historically this has led to migrant communities being unusually motivated in the work sphere. At one end of the spectrum this has led to 13-14% of Indians in the UK becoming part of the ‘professional classes’, nearly twice the figure for white male Britons14. Members of British ethnic minorities are, taken together, more likely to be entrepreneurs than the white population15. Even amongst the figures normally cited to highlight the existence of serious deprivations amongst ethnic minorities in the UK, there is evidence of the self-selection of migrant families. For example, Bangladeshi children achieve the lowest standard of school results in the country. However, their attainment levels at GCSE have doubled in 6 years, indicating the fastest growth in education standards for any ethnic group in Britain16. In the 2000 A-Level results, Bangladeshi children again showed the fastest improvements, underlining the fact that even if a migrant who comes to the UK is unskilled, it does not mean for a moment that they or their families are lacking in a work ethic. Indeed the opposite seems to be true. Writing about the American experience with migrants, Julian Simon wrote that:
“Compared to natives, their rate of participation in the labour force is higher, they tend to save more, they apply more effort during working hours, and they have a higher propensity to start new businesses and to be self-employed.” 17
The benefits of cultural interaction and assimilation
The second advantageous aspect of allowing economic migrants into the UK is the cultural assets they bring with them, whether they be cuisine, music, science, literature, forms of social organisation or actual objects and resources. Britain has benefited an incalculable amount from imported practices, from chicken tikka masala ( purportedly Britain’s most consumed dish ) to democracy itself. The dangers presented by nations which legislate to enforce cultural purity hardly need repeating. Britain is not about to go down such a path, but the lack of open migration channels means an inevitable retardation of cultural assimilation, with potential social and economic costs. The missed opportunities themselves are impossible to calculate, but we need only to note that the founder of Intel was a Hungarian born migrant to the US, or that Picasso received inspiration from African masks, to see the varying and potentially enormous opportunity costs that hindering cultural interaction could have. Had we had such strict migration policies in the past as we do today we can be sure that Britain would be a less rich place than it is. Our primary religion, much of our language, our beer and favourite foods all have strong foreign elements which could have been excluded by our current migration policies. And then there is Marks and Spencer.
Economic migrants are desirable primarily because they fill jobs which employers want to be filled. Britain is in an unusual period where the number of jobs is relatively high compared with the active labour force. Migration laws ought to reflect the desire of British companies to be able to employ more migrants for the good of themselves, their shareholders, their customers, and (of course), the job seeking migrants. Second, migrants who come to the UK tend to be willing to work hard, are unusually entrepreneurial and to take up employment that Britons are not willing to. Lastly, migrants are desirable because they bring social and cultural practices which challenge stagnation in our private and public lives. They bring new ways of approaching problems and of entertaining ourselves which serve to make our lives more vigorous and interesting.
4 – Changes
The migration system needs reforming. It is a system of two parts, the first being the normal day-to-day migration controls, the second the asylum system which exists to give sanctuary to those fleeing persecution. The government has shown signs that it realises that the issues surrounding the two have become confused. It is seeking to separate them in order to instigate changes, particularly to the non-asylum migration channels. Barbara Roche stated that:
“In ensuring that we crack down wherever necessary on misuse, we must not lose sight of the bigger picture. Many immigrants….have been very successful here, bringing economic benefits to Britain as a whole” . 18
Separating the two systems must not be done unthinkingly. Britain cannot have two separate migration systems which do not carefully interlock. The wrong incentive from one system will drive people from one to the other. This is exactly what has been happening over the last decade as potential economic migrants have discovered that the asylum system can be used as a successful means of entry. There is a danger that reforms which do not take into account the interrelated nature of the systems will just create a different set of unwanted incentives.
In the following sections a pair of blueprints are sketched out which are designed with the question constantly in mind: “Will this system make the right people use the right channel?”
Reforming the economic migration system
As seen above, the work permit scheme as it stands is flawed. It is targeted, soviet style, at workers with skills that the Home Office bureaucracy decides are ‘required’ for British prosperity. But necessary skills in the work place are changing so fast that companies have found it essential to implement continual training schemes just to keep their employees up to date with current technologies. In the light of this the government list of approved computer skills is laughable both in content and conceptualisation. The list is lacking PHP, Autocad and SNA, all major technologies, and has no specific mention that web designers are needed the UK, even though the page the list is on itself contains a broken link.19
One of the most talked about proposals for migration reform, the introduction of a points based system similar to Canada, suffers from the same problems as the existing British system. In Canada an applicant is awarded points according to the content of their application, such as points for having a relative in the country, or being a computer programmer. If they receive enough points, the applicant gains permission to live and work in Canada. However, this method suffers from the same type of unresponsiveness to actual demand associated with bureaucratic systems selecting useful skills. This is probably the most serious weakness with the points system: that in one important way it too closely resembles the existing UK work permit system.
The question of skills selection is not just one of choosing the right technology to add to the list. There is an unfounded bias against low and medium skilled workers in our existing migration policy, even though they are the lifeblood of the modern services sector. While they are not as purely productive as IT workers this does not mean that they are not in demand from many businesses without the glamorous dot.com status.
There is simply no way that the civil service can efficiently declare what workers the UK needs. Indeed the only people who know what British companies and British customers need are the companies and their markets. The shortages discussed above are the most visible manifestation of this failure. The opportunity costs of the existing permit systems are great, but can never be calculated.
So how should this system be reformed? One solution would be for companies to be able to submit to an electronic system either the name of a specific person, or to contract an agency that would find and then submit the name of a potential employee to the same system. Applicants for migration would be able to apply for permanent or temporary work permits by having their details registered. The moment a company expresses a desire for a particular worker, the worker ought to be awarded an appropriate work permit. Job agencies would be free to act internationally between employers and labour markets, which could make obtaining the work permit transparent to both parties. The system would be non-discretionary and based on a simple demand-award system. If there was no demand, applicants could still apply and have their applications held in a queue until demand for those skills emerges. This would make the life of work placement agencies easier as they could search the waiting list for appropriately skilled workers, and advertise them to businesses.
The duration of work permits ought to be somewhat longer than the expected employment duration of the worker. This would give workers time to new seek work if their employment came to an end. If a new job were found, or if they started one themselves, their permit would be extended. If they remained persistently unemployed, their permit would be revoked.
Of course, practical political pressures will demand that the government manifests a control over the numbers of economic migrants permitted entry to the UK. The system sketched out above allows this to be achieved through a numbers quota, to be set according to political acceptability. When the quota has been used up, new applicants would be added to the queue, until the next period for the quota begins, or as Britons or workers leave and formally give up their rights of abode.
This system would allow British governments to display a control over workers’ rights and pay levels, both highly sensitive issues. No worker could be demanded by a business, for example, where pay offered is below the minimum wage. If politically necessary, this could also act as a way of preventing British businesses from using the system to replace native workers with cheaper substitutes; an almost unknown phenomenon, but one which provokes great public fear. Additionally, a family re-unification scheme could be run along side the new system, very much along the rules of the existing one.
Reforming the Asylum System
Reforming the work permit system still leaves the question of asylum. There is little doubt that given more flexible migration channels many of those who seek asylum without firm grounds for doing so, would change their approach and apply legitimately, thus avoiding the penalties associated with being discovered as a non-refugee. Nevertheless, unless other policies are changed, the incentive for those purported migrants who want only to live on welfare will remain unchanged. If only for the sake of the public image of migrants as a whole, this group has to be as firmly discouraged as possible.
There is a humane way of dealing with this issue that does not require the currently proposed reassessment of the 1951 UN Convention. Benefits for asylum seekers might be limited in length to no more than a few months, and made conditional on seeking work. Welfare to work schemes have been embraced successfully in a number of western states. Since subgroups of asylum seekers who want to live off benefits rather than work are a form of welfare dependency problem, they can and should be dealt with in a similar way to policies designed for natives.
Consequently the ban on employment for most of those in the process of seeking asylum should be dropped. Those who are granted asylum need not have wasted their time and tax payers’ money waiting for work permits (including many of the estimated 1000 asylum seeking doctors who sit idle in London at the moment20). Those whose asylum claims are found wanting, but who still find productive employment, could also be converted to normal ‘economic migrant’ status but hit with a punitive income tax rate for a fixed period of time. This would act as a disincentive to use the asylum channel rather than the newly reformed economic migration channels, while avoiding the absurd waste of labour, benefits and tax revenues that the current asylum system entails. Those who fail on both judgement and employment counts could be struck off welfare and deported. The recent proposals to remove the rights to employment from those asylum seekers who have gained them would serve little more than to push even more asylum seeking employment underground, and out of the taxation system.
Conclusion
There are many aspects of the immigration debate which are purposefully left out of this discussion paper in the interests of brevity and clarity. The most important omission is the question: “What harm, if any, do migrants do to the UK?”. This question has not been raised because this paper is aimed at reforming government policy, and the government does not and will not say what it fears from an overly generous migration system.
Bypassing questions of possible harm is less important a problem than it initially seems. Whatever the potential costs of migration may be, they will not actually be the reason that the government decides to set restrictions at a certain level. Instead public opinion that remains strongly hostile to most migration will be the primary restraint. The government is never likely to have to ask seriously “What do migrants mean for housing or unemployment?” because public opinion is certain to keep permitted numbers below levels at which these issues become relevant. A further paper, to follow this one, will explore exclusively the objections to migration and will be aimed at rectifying press and public misperceptions concerning migration, which the government and civil service currently take as given.
What this paper has sought to demonstrate is that there is a pressing need for migration reforms, and has sketched out a system which could replace existing policies. It has been shaped to improve the existing system while recognising the delicate political realities surrounding migration as an issue. Hopefully careful improvements to the migration system will themselves change the nature of those political realities, and perhaps allow more frank debate than is possible at present.
Endnotes
1 The views expressed in this working paper are those of the author and not of the IEA (which has no corporate view), its Directors, Advisors or Trustees.
IEA Working Papers have not been subject to the same rigorous peer review process to which all other IEA papers are subject. It is the purpose of these papers to stimulate debate on issues of contemporary import; the author is grateful for comments, please contact him at tsteinberg@iea.org.uk.
2 Commons Hansard, 22 February 1999, pt12.
3 Alan Travis, “Migrants with skills may be welcomed”, The Guardian, 22 July 2000.
4 All figures in this paragraph are from HMSO Control of Immigration: Statistics United Kingdom, Second half and year 1999.
5 http://www.dfee.gov.uk/ols/html/bc/bceligib.htm#ebook1
6 In 1997 UK median wage was £14,020 per year, Social Trends 1997, Office of National Statistics.
7 It is not required to advertise for certain employment fields such as medicine and nursing.
8 Barbara Roche speech in Paris, 21 July 2000, p10.
9 Ann Widdecombe quoted by David Bamber, “Labour to invite 100,000 foreigners a year into UK”, The Daily Telegraph, 3rd September 2000.
10 http://news2.thls.bbc.co.uk/hi/english/business/newsid%5F751000/751963.stm
11 http://news.bbc.co.uk/hi/english/education/newsid_807000/807053.stm
12 The Economist, ‘A Continent on the Move’, 6 May 2000.
13 Some commentators have noted that working migrants must actually contribute more to the tax coffers than natives because they do not bring pension claiming relatives with them. Unfortunately, in the UK there are no studies with which to compare this theory.
14 Social focus on ethnic minorities, ONS, p12.
15 Office of National Statistics, Labour Market Trends, June 2000, p253.
16 All figures in this paragraph are from “Social Inequalities 2000” from the ONS.
17 Julian Simon, “The Economic Consequences of Immigration into the United States”, Ch 17.
18 Barbara Roche, speech, ‘UK Migration in a Global Economy’, p8.
19 http://www.dfee.gov.uk/ols/html/bc/bcshort.htm
20 The 1000 doctor figure is a Refugee Council estimate. Foreign doctors would, of course, have to be trained and certified to British standards.
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