UK immigration: Time to abandon the Conservative target

In this article, Sophie Barrett-Brown and Miglena Ilieva of Laura Devine discuss attitudes to immigration in Britain, and how the Conservative Party has failed to enforce their reductions

Recent Ipsos Mori polls suggesting that attitudes to immigration in Britain are softening could not have been more timely. As the Conservative Party prepares to choose the country’s next leader, the shift in attitudes marks an end to Theresa May’s legacy of attempting – and failing – to reduce net migration figures arbitrarily to the ‘tens of thousands’ as well as creating the now widely-known ‘hostile environment’ policy.

While the current Home Secretary, Sajid Javid has preferred to refer to ‘sustainable levels of net migration’ and the ‘compliant environment’, it seems clear that the UK is becoming less anxious about immigration.

It is notable that this shift in social attitudes has occurred while free movement remains very much intact and when there have been no significant changes to the current immigration system. Moreover, the latest figures published by the Office for National Statistics (ONS) show that net migration to the UK has remained largely stable since the second half of 2016, when attitudes towards immigration were comparatively more hostile, with immigration being one of the top reasons why people voted to leave the European Union.

Fewer EU migrants moving to the UK for work

Whilst net migration remains positive overall, EU net migration has been in steady decline since the referendum. In particular, the latest figures show that more nationals from the EU10 countries (including Poland – the largest source country of EU nationals in the UK), are continuing to leave the UK than arriving. As we have observed since 2016, the declining trend in EU migration reflects the personal choice of EU migrants, not the impact of any legal or policy changes; the UK is seen by EU nationals as a less desirable place to live, work and do business.

EU net migration has been in steady decline since the referendum

Of course there are also various other push and pull factors attracting EU nationals to return to, or remain in, other member states: the economies of many of these member states are growing, with higher levels of employment, wage growth and increased foreign investment, in contrast with the lower relative value of the pound and the UK’s crippling uncertainty around Brexit.

Non-EU migration impact

With the continued uncertainty around Brexit and declining EU migration, it is little wonder that statistics show that businesses are increasingly turning to migrants from outside the EU, via the Tier 2 sponsorship route to fill skills gaps in the UK. Latest Home Office figures demonstrate a 15% increase in the issue of Tier 2 certificates of sponsorship for skilled non-EU workers, with a particularly marked increase in the use of Tier 2 by the health and social care sector (up 62% in the year ending March 2019).

businesses are increasingly turning to migrants from outside the EU

However, with upfront costs for a typical 5-year sponsorship of a non-EU worker with a spouse and 2 children reaching over £18,000 in Home Office application fees and associated charges alone, in addition to meeting the minimum salary requirement (currently at least £30,000), small and medium-sized British businesses that are being disproportionately impacted, particularly those outside London and in certain industries.

Sectors such as manufacturing, social care, health, hospitality, leisure, and construction all rely heavily upon migrant talent, but can little afford the substantial costs of the Tier 2 system. Further, a significant proportion of their skilled workforce is not recognised as sufficiently ‘highly-skilled’ to qualify under the current Tier 2 regime which only permits certain degree-level roles. It is anticipated that services such as caring for the elderly or disabled, infrastructure, and food service, will continue to face skill shortages until at least the introduction of the new immigration system from 2021.

New immigration system

The main work route proposed in the government’s white paper is expected to remain similar to the current Tier 2 arrangements, with a number of modifications – including a reduction in the minimum skills threshold from RFQ 6 (degree level) to RFQ3 (A-level equivalent). Whilst such proposals are welcome and necessary, with no corresponding reduction in minimum salary thresholds (or fees) proposed, the route is likely to remain inaccessible to many employers experiencing skills shortages in the wake of Brexit – and again hardest hitting SME’s, certain sectors and regional businesses.

the route is likely to remain inaccessible to many employers experiencing skills shortages in the wake of Brexit

There is also a provision for lower-skilled migration in a new immigration category which will allow migrants leave of up to 12 months with no option to extend. As it often takes several months before an employee is fully trained in a job, many employers are expressing concerns that such short term arrangements are inadequate and insufficient in tackling the growing skills shortages and do not support the integration of such workers. There is currently a consultation and businesses are encouraged to make their views known.

Investors and Entrepreneurs

Despite the Brexit deadlock, the UK continues to attract significant interest from high net worth migrants under the Tier 1 Investor route, which allows individuals to move to the UK based on an investment of at least £2 million. This enables successful applicants to live in the UK without having to work (but being free to do so) and to potentially settle within two or three years of entering the route under its accelerated settlement provisions for those investing a minimum of £10 million or £5 million respectively.

The latest Home Office statistics show that Tier 1 Investor numbers continue to increase, reaching their highest levels since 2014 (when the investment sum required doubled from £1 million and applicant numbers plummeted) and remain dominated by applicants from China. This trend is expected to continue, particularly in light of the recent removal of the Tier 1 Entrepreneur category (requiring £200,000 investment and job creation in a UK business) which will inevitably displace more affluent applicants into the Tier 1 Investor route.

The Home Office has replaced Tier 1 Entrepreneur with the new Innovator category, requiring endorsement from a limited number of ‘Endorsing Bodies’, the vast majority of which are tech-focused and operate closed schemes only open to applicants already participating in their accelerator programmes (and often requiring applicant to cede equity). Whilst some will certainly benefit from the scheme, many excellent business will be lost to the UK (particularly those of more established entrepreneurs) due to the much more limited scope of the replacement category.

International students

There have long been calls for international students to be removed from the net migration data, however, they continue to contribute to the overall figures. The latest data shows that, like investors, non-EU students continue to view the UK as an attractive destination: 211,000 people arrived to carry out long-term study (predominantly at university level) – the highest recorded number since 2011.

So what next for the net migration target?

None of the current candidates to lead the Conservative Party has expressed an outward view of whether they will continue to stick to a specific figure. Given that last quarter’s data was the 37th time the government failed to deliver on its promise to bring net migration to the tens of thousands and with societal attitudes towards immigration turning the tide, now is the time to abandon this arbitrary figure once and for all and to instead focus on creating an open, inclusive and fair immigration system to best serve the country in a post-Brexit world.

Sophie Barrett-Brown

Senior Partner and Head of UK Practice

Laura Devine Solicitors

Miglena Ilieva

Senior Solicitor and PSL Team Manager

Laura Devine Solicitors