Jamie Bryant, an expert in UK immigration and founder of UKVisas.co.uk, looks at the potential implications and challenges of this post-Brexit immigration system.
In July, Boris Johnson announced ‘It is right to go for an Australian-style points-based system so that the needs of the UK economy can be properly met.’
Offered as the ‘answer’ to UK immigration, the Prime Minister’s comments generated headlines across the world. However, is it more media soundbite than substance, and what will it mean to UK businesses?
The reference to an Australian-style system is intended to appeal to those who want to see a tougher stance – Australia’s immigration system has a reputation for control – and yet has also been welcomed by industry for encouraging talent. The CBI’s Chief UK Policy Director, Matthew Fell commented: ‘Any approach focusing on the people and skills the country needs… will be welcomed by business.’
Touted as radical reform, the business community will be eager to see if this model can deliver. However, we already have a points-based system for non-EU nationals. This was introduced in 2008 and was itself based on the Australian points-based system but has, over the past decade, become hampered by complexity and increasingly draconian restrictions. As a visa and immigration advisor working with UK immigration policy on a day to day basis, I’m the first to welcome change if it tackles these problems. The UK needs a points-based model that meets our industry needs. And at this stage, the rhetoric seems more concerned with engaging public appeal than offering substance.
What do we need from a new immigration system?
The UK may be ‘open for business’, but any new policy must address the labour shortage we face in both lower paid and skilled roles.
Affordability for SMEs
Our current immigration system, in its original format, enabled ‘highly skilled’ migrants from outside the EU to come to live and work in the UK free from restrictions, whilst ‘skilled’ migrants required sponsorship from licensed employers. Today, almost all ‘highly skilled’ migrants require sponsorship, while many previously accepted ‘skilled’ roles are no longer eligible. Those that do have to be paid at least £30,000 per annum. For many small to medium-sized companies this is just too costly, especially when combined with application fees. A reduction in the threshold would be a welcome development for business. In addition, the number of Tier 2 visas is capped at 20,000 which impacts industries such as IT, engineering and the health and education sectors. Many will be hoping a new approach focuses on fulfilling actual labour requirements and not number targets.
Support for industries that rely on unskilled workers
A Tier 3 category for manual /agricultural workers was included in the original 2008 system but was never actually activated. This category was aimed at non-EU unskilled migrants in industries that rely on lower paid roles, such as construction, caring and hospitality and also as a replacement for the Seasonal Agricultural Workers Scheme. Instead the UK has had to rely on EU workers to fill this labour gap.
In future, the UK will need to recruit shorter-term unskilled workers. A small government-led pilot scheme is being trialled to employ 2,500 non-EU migrant workers for seasonal agricultural work, which may prove beneficial in determining policy.
What could a new points-based system look like?
Will it be a case of one size fits all, where ‘nationality would no longer affect eligibility to work in the UK’ (Centre for Policy Studies), or a separate parallel immigration system for EU citizens to help with issues around freedom of movement? The Catch-22 predicament arises as arguably any exceptions granted to EU nationals looking to live and work in the UK would be unfair on migrants from the rest of the world.
If one central system is agreed, it is likely to follow the current score-based structure, which many argue is more in name than nature. In Australia, applicants don’t need a formal job offer, but can accumulate enough points based on skills, work experience, age and qualifications. This system hands control to government rather than employers, and occupations can be restricted or encouraged as needed.
The future implications
Until more details of the government’s review of the Australian system by the Migration Advisory Committee are revealed, it’s hard to say what the wider implications of a new immigration system will be for UK businesses. For now, the continuing complexity and uncertainty will continue to restrict migration and compound the skills shortage. The government already anticipates a reduction of between 200,000 and 400,000 EU nationals in the workforce (HM Government whitepaper), which means our labour crisis could deepen.
One thing is clear – a new set of rules is needed. The current system has become overcomplicated by years of policy changes and now contains some serious shortcomings. Cherry picking the best of the Australian model might prove effective, but it will only succeed if backed by a new ethos focused on the merits of migration. We must wait to see.