Immigration Rules

Wednesday 7th July 2021 Westminster Hall

10:49

[Esther McVey (in the Chair)]

I remind hon. Members that there have been some changes to normal practice in order to support the new hybrid arrangements. Timings of debates have been amended to allow technical arrangements to be made for the next debate. There will also be suspensions between each debate. Members attending physically should clean their spaces before they use them and as they leave the room, putting the cleaning materials in the bin.

[Anne McLaughlin (Glasgow North East) (SNP)]

I beg to move,

That this House has considered Immigration Rules and highly skilled migrants.

It is a pleasure to serve under your chairwomanship, Ms McVey. With yesterday’s announcement of the new Nationality and Borders Bill, I am pleased to have the opportunity to lead this debate on the immigration rules and highly skilled migrants. I want to start by thanking the right hon. Member for East Ham (Stephen Timms), who originally secured this debate and asked me to take it on. I know he is doing a lot of work in this area.

I also want to mention my hon. Friend the Member for Glasgow Central (Alison Thewliss), who recently challenged the Chancellor and the Home Secretary on the introduction of yet another scheme to bring in highly skilled migrants in the 2021 Budget. I echo her sentiments that the Chancellor, the Home Secretary and the UK Government must sort out this injustice once and for all before another person is given a highly skilled migrant visa. I am sure that people of colour from Commonwealth nations contemplating bringing their talents to the UK, including under the new scheme, will want to know of any potential risks to their and their families’ immigration status prior to applying. I also want to commend BBC “Newsnight” for covering the issue a few weeks back, raising awareness and prompting people to contact me.

What is it that has got everyone so exercised? It is complicated and simple. The nub of it is this. Her Majesty’s Revenue and Customs has been sharing information about a subset of non-white highly skilled migrants from specific Commonwealth countries in the global south with the Home Office. That enables the Home Office to then refuse their visas to remain in the UK. The basis for the refusals are historical, non-criminal tax discrepancies, some very minor—I understand one was for only £1.30—and most dating back years, long ago resolved, and none of which HMRC felt required further action. Let us bear in mind that the people we are talking about have been here for 10 years or more. Finally, the legal basis on which this has been done is questionable. So that is the summary.

These individuals, who were invited to these islands to contribute to our economy and wider society, now find themselves in a precarious immigration limbo, without any investigations into the circumstances or nature of people’s tax discrepancies before the visa refusals. There remain many questions about whether the decisions taken have allowed fair assessments and hearings, and how proportionate visa refusals are for something that has not even been proven to be deliberate or careless under HMRC’s own threshold for discrepancies and within HMRC’s normal 12-month timeframe for investigation.

Through a number of Government initiatives spanning decades, there has been a consistent call to invite the brightest and best to these islands, with the idea being that the UK would take control over who they allowed to work and live here. Yet somehow the UK Government have systematically failed to build the immigration system that they say they want. Instead, they have adhered to a policy of hostility, exclusion and really disproportionate punishment. I am sure the Minister will likely talk about “minded to refuse” letters that allow migrants to explain the discrepancies, but, in 80% of the remaining cases, those have not been received and, where they have, some have contained more than 100 questions for response within 14 days. Also, it is about issues much wider than tax discrepancies.

There is a concern that the letters are being used not to give a fair and timely hearing of evidence, but to double down on the initial decisions made. The deeply precarious situations that many of these highly skilled migrants and their families are now experiencing highlight the issue only too well.

Highly skilled migrants in the UK have been criminalised and denied indefinite leave to remain based on the Home Office’s discretionary and subjective bad character or dishonesty judgments in paragraph 322(5) of the rules, as I said, for historic tax discrepancies, many up to 10 years ago. Paragraph 322(5) sets out the general grounds for refusal. Unlike other immigration provisions for criminal behaviour, which this is not, it seems to be still applicable even after 10 years. Clarity is needed—I hope the Minister will provide it—about how this immigration rule will be used in future immigration applications of highly skilled migrants who have been granted some form of leave.

I also note with concern that paragraph 322(5) and related clauses in the immigration rules have recently been redacted online. I hope that this redaction is not a means of limiting scrutiny of how these clauses are being used in immigration decisions, and I expect the Minister to have an explanation for that.

I am not the only one saying that the Government are wrong; the Court of Appeal has already ruled in two separate cases that the Home Office has acted unlawfully in this regard. Paragraph 322(5) permits refusal when an applicant is considered

“undesirable…in light of their conduct, character or associations”,

or the fact that they represent a threat to national security. This measure also allows discretionary refusal by inferring “undesirable” character. According to the latest guidance, that could be because of criminal-related activity short of a conviction, or for what are called “wider reasons”. So, with no convictions and no reasoning, the Home Office can unfairly label someone as being “undesirable” or of bad “character”. Can Members imagine how such labels affect someone’s ability to live and work in a community, or impact on their self-esteem?

Being denied their indefinite leave to remain has left these highly skilled migrants in a legal limbo; they are unable to work, rent, drive, receive NHS healthcare, open bank accounts, or get vital access to public funds. Imagine a situation in which someone has a minor tax discrepancy hanging over their head. And bear in mind that, according to the Institute for Fiscal Studies, around 60% of self-assessment tax returns in the UK contain discrepancies. For anyone who has had to complete one of these returns, that is not difficult to believe; they are not easy. For most of us, a minor tax discrepancy would just mean reminding ourselves to amend our tax return, or we would call an accountant to sort the problem out for us; the worst that can happen is that we will get a slap on the wrist and a cursory fine. We would not be in a situation where we were left destitute, as is the case with so many of the people who we are talking about today.

Understandably, this situation has been described as a “personal purgatory” by some of those experiencing it: a half-life, in which someone is unable to contribute, without any recourse to appeal or explanation. It must be a truly devastating prospect for someone to think that they could be treated as criminal under an immigration rule that was reserved for those deemed a national security threat, based on a simple discrepancy in a tax return.

Although the actual amount of these discrepancies ranges widely, some of the figures involved are shockingly small. As I have already said, a discrepancy of around just £1.30 could see someone being deemed as dishonest or of bad character by the Home Office. In the two cases that were heard in the courts, one involved a small amount of money and one involved a larger figure, but the courts found the people concerned to be honest and granted them leave, which shows that the amount of tax discrepancy per se should not matter and does not automatically mean that the person responsible for such a discrepancy is a criminal. The courts certainly did not think so.

Investigation into the circumstances and a balancing exercise regarding the person involved and their family is key. Indeed, this cohort of people are not criminals. They are hard-working migrants who were invited to this country, which is now determined to use a system of legal loopholes and loose statutory interpretation, which I will come on to, in order to remove them.

Tax discrepancies are neither a criminal nor an immigration offence, and in all of the cases reported, HMRC did not independently pursue the discrepancies at the time of filing. So why is the Home Office pursuing these migrants? Why are the thousands of other cases are uncovered every year—including those of the 60% of people who fill in tax returns inaccurately—not being pursued with the same vigour? And I am not suggesting that they should be.

Tellingly, UK Visas and Immigration has refused applications under this rule, instead of using certain other provisions in the immigration rules that it could use, such as those related to dishonesty. I would suggest that UKVI has done that because of the broad wording of this measure and the lower burden of proof required, because using this rule is an easy and fast way to dispose of the migrants we invited to these islands.

Paul Garlick QC, who specialises in extradition and human rights law, said the following in regard to the Home Office investigations:

“They genuinely have no idea of the difference between tax years and accounting years, or what is a legitimately deductible expense. My feeling is that since Theresa May’s announcement of a ‘hostile environment’ for immigrants, caseworkers have been told to look for discrepancies that could form the basis of an accusation that the applicant is lying, because that’s the quickest way to dispose of an application”.

That is some accusation, and not one that any QC would make lightly.

Since 2016, 1,697 of these highly skilled migrants have been denied indefinite leave to remain after the establishment of a very untransparent Home Office and HMRC data-sharing memorandum of understanding—one that allowed HMRC data to be analysed if an immigration offence had been suspected. I will come on to that point in greater detail later.

These highly skilled migrants have been living in the UK for at least 10 years and contributing significantly to our skills base and our economy. They were once welcomed here because they were needed. What is most worrying of all is that all of those affected are migrants of colour, from six south Asian and African countries. More than half of the remining indefinite-leave-to-remain refusals are Pakistani nationals, and 70% are Muslim. Tellingly, no one whose data was shared and used to refuse their visa was white. As a long-standing antiracism activist, that profiling and targeting of ethnic minorities by the state chills me.

I want to focus on the worrying aspects of data sharing. The people we are talking about were refused indefinite leave to remain through the use of detailed, historical, HMRC-held tax data. According to research by the Migrants’ Rights Network, it is unclear whether any due processes or protections were in place for the access and sharing of that data, especially those that would now meet GDPR requirements.

The memorandum of understanding for data sharing between both Departments was accessed via a freedom of information request. It is an enlightening piece of evidence. It is not a contract, nor is it legally binding. It does not in itself create a lawful means for the exchange of information. It simply documents the processes and procedures for information sharing agreed between the Departments. Yet, when I pushed the Treasury on this issue recently, the Minister who responded leaned heavily on the provisions within the MOU as being

“well-designed, information-sharing gateways…grounded in strict obedience with the law.”—[Official Report, 22 June 2021; Vol. 697, c. 748.]

The annexe of the document provides the legal basis for the sharing of information and conveniently links to several pieces of legislation, including the Immigration, Asylum and Nationality Act 2006, the UK Borders Act 2007 and the Anti-terrorism, Crime and Security Act 2001. There are others. What we discover when directed to the signposted sections is that the minor tax discrepancies in question do not amount to the offences described in the memorandum of understanding that could permit the sharing of data between HMRC and the Home Office. The MOU provides no evident lawful due process or safeguards for sharing the data that was used to refuse indefinite leave to remain to highly skilled migrants.

There are huge questions to be asked about how this information was accessed and shared and whether unlawful lists of people of concern, based on a traffic light system of nationalities, were used. I appreciate this cannot all be resolved today, but I would very much appreciate if the Minister would agree to meeting me, other interested Members and the Migrants’ Rights Network to unpick all this and to, I hope, put an end to it.

The tech justice group Foxglove successfully forced the Home Office to scrap its visa streaming algorithm in response to legal action in 2020 and there are analogous similarities with the data-sharing system that I am talking about today. The streaming tool took decades of institutionally racist practices, such as targeting particular nationalities for immigration raids, and it turned them into software. The Home Secretary was willing to admit that the system was required to be rebuilt from the ground up. Surely serious consideration should be given to the system currently persecuting highly skilled migrants.

The Government’s threat to increase their use of data sharing and data matching is now, unfortunately, becoming a reality. There are plans to expand the national fraud initiative. If that happens, we will see the current data-matching powers used in tackling fraud extended to cover other criminal activity, as well as debt recovery and data quality.

I knew little about data matching until this highly skilled migrants issue was brought to light. It involves combining, comparing or matching personal data obtained from multiple sources. The national fraud initiative already collects more than 20 data types over 8,000 datasets from 1,300 participant organisations. That can include public sector payroll, housing benefit, social housing waiting lists, council tax and the electoral register—the list goes on.

An information law specialist, Chris Pounder, has already given examples of how migrants’ details are mixed up in the national fraud initiative, with housing benefit, tenancy waiting lists and the electoral roll all cross-matched with immigration records. We have seen the Home Office go from losing application forms, passports and all sorts of documentation in 2001, to being determined to gather every single tiny piece of data that it can on every migrant in 2021. Information sharing or data matching—call it what you will—has been utilised to unfairly target highly skilled migrants. This cohort sets an incredibly important precedent for how personal tax data could be gathered, shared and used in immigration decisions, highlighting why we need to ensure transparency around data sharing for immigration enforcement.

Through freedom of information requests, we now know that between 2015 and 2020, 463,000 people’s HMRC tax data were shared with UKVI at the Home Office. That is a staggering amount of data sharing that the public are simply not aware of. Any expansion of this already expanding regime will mean a lot more data being shared about migrants, and it will provide numerous opportunities for abuse by the Government, who are already determined to pursue a hostile environment policy. Such data needs protection and safeguards. Any system that seeks to share the data must be built with legal restrictions and strict adherence to GDPR.

The UK Government consultation document on data matching refers to the need to recover debt post covid, but it fails to recognise that any inequalities present before the covid pandemic have both increased and widened, and that extending the powers will serve only to unfairly discriminate further against minorities. I am aghast that the cover of covid recovery is being used to usher in further intrusion into our personal data, and I have no doubt that the wider public would be just as alarmed if this was affecting their right to work, rent, drive or even open a bank account.

When previous and successive Governments implemented schemes that were designed to welcome highly skilled migrants to these islands, it was done with fanfare. The brightest and best would help us fill the gaps that our economy desperately needed to be filled. Nobody arriving on these shores to such a welcome would ever suspect that, a decade later, they would be subjected to an invasive sweep of their personal and financial data in a bid to remove them and their families from the country they now call home. Nobody would have dreamt that, 10 years later, they would be labelled dishonest or as being of bad character, when they are clearly not. Nobody would have imagined that they could have been made unemployed, bankrupt or homeless by the state that invited them to build their lives here, but that is exactly what is happening.

I hope that today’s debate will allow a conversation to be started where it has not been possible thus far. I look forward to hearing the Minister’s response, and I repeat my request for him to sit down with me, the right hon. Member for East Ham, the other Members who have been pushing this issue and Migrants’ Rights Network, in order to resolve the situation for the families suffering now, but also for the success of the Chancellor’s new highly skilled migrants scheme.

11:18

[The Parliamentary Under-Secretary of State for the Home Department (Kevin Foster)]

It is a pleasure to serve under your chairmanship, MsVey. I thank the hon. Member for Glasgow North East (Anne McLaughlin) for securing the debate with the right hon. Member for East Ham (Stephen Timms), and for the contribution that she has made. Such debates are an important aspect of the Home Office’s accountability, and they ensure that our decisions are held up to scrutiny. I am therefore pleased to have the opportunity to set out some of the background to this particular cohort of cases and what we are doing to ensure that all the applications involved are treated fairly. There are some legal actions going on, but I would be happy to meet hon. Members and groups that are not involved. Perhaps we can discuss the details separately, given the limited time.

It has to be said that the tier 1 general route, to which highly skilled migrants applied, was beset with problems and opportunities for abuse, which is why the Government closed it to new applications back in 2011. The investigations that we have concluded so far show that the principal issue is not tax records and the evasion of tax payments that should have been made, but applicants falsifying their earnings to obtain their immigration status, often involving five-figure sums. It would be simple to ignore those concerns and grant all the outstanding applications. However, that would not be a right or just outcome for those who did play by the rules, given that the scale of the discrepancies is often far beyond those that might be attributed to innocent mistakes or accounting practice.

[Anne McLaughlin]

Surely the Minister is not suggesting that everyone I am talking about has been denied indefinite leave to remain because they falsified earnings in order to get themselves here. Those people were invited and allowed to come in. He is not suggesting that, is he?

[Kevin Foster]

I am afraid that we have evidence from a range of cases showing that people did look to inflate their earnings from self-employment. In each case we will make an individual decision, but in each case we are satisfied that there is evidence. There will be an opportunity for people to make their representations directly, but we should not ignore the fact that there has been some quite clear evidence. We are not talking about a difference of a couple of quid between their tax return and what they told the Home Office; we are talking about quite significant amounts. We will continue to consider all the evidence fairly and objectively in each individual case and not generalise about them all. We will give applicants the chance to respond to any concerns we have. But, as anyone would expect, we will be firm with those who have sought to play the system.

[Anne McLaughlin]

The Minister says that he will consider every case on its merits, but what happens to those people in the meantime? They are not allowed to work, rent, drive or have a bank account, and they are not allowed any recourse to public funds. Those people have families, with children at school. The kids will not be allowed to go to school. What happens to them in the meantime, because it is taking a very long time to reach decisions?

[Kevin Foster]

There are a number of processes that we are going through, but it might be helpful if I set out the scale of the discrepancies. In cases where investigations have been completed, there were instances of applicants claiming points for earnings that were, in 80% of cases refused, at least £10,000 higher and, on average, £27,600 higher than the earnings shown by their tax records. We would all agree that those are not minor errors. In any context where we were talking about someone with a discrepancy of £27,000 on their tax return, we would probably make a point about whether they were paying the tax they should be paying.

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Member for Glasgow North East (Anne McLaughlin) on securing the debate. Will the Minister outline what steps his Department will take in conjunction with HMRC to investigate whether the tax discrepancies of highly skilled migrants refused indefinite leave to remain met the normal HMRC deliberate or careless threshold? How did the Department determine that such discrepancies constitute bad character?

[Kevin Foster]

We do so by sharing information between the two Departments. If someone gives information about their salary to one part of Government, saying that it is an honest declaration of their tax position to meet taxation laws, it should not come as a huge surprise if that is then considered when looking at a declaration of income that they have made to another part of Government relating to rules on immigration status.

Let us be clear that not all tier 1 general cases share those characteristics. Many applicants did find highly skilled employment, and the vast majority were successful in their applications. There are outstanding cases because it is important that we take the time to get to the bottom of concerns in those outstanding cases and establish whose earnings were genuine and whose were not.

With regard to the tax discrepancies, the Home Office does not trawl through people’s tax records looking for any errors or discrepancies in order to refuse applications. Where we have checked tax records, it is because the evidence of an applicant’s claimed earnings was not strong, and we were actually looking for further evidence to support their claims and grant their applications, as we are doing in other parts of the immigration system. Sadly, all too often our investigations found their tax records did not support the claims they made to the Home Office about their earnings.

It is interesting to note that when it became widely known that we were doing that, HMRC saw a surge in requests from tier 1 general visa holders to make some highly unusual amendments to their tax records, often involving large amounts solely for the earnings periods relied on in visa applications. That pattern was actually so unusual that HMRC brought it directly to the Home Office’s attention.

Again, we are not talking about the sorts of minor discrepancies or tax errors that HMRC deals with day in, day out. Our investigations show instances of individuals increasing their earnings on their tax records, waiting until a Home Office application is granted and then amending their earnings back down again so that they do not have to pay the extra tax that these variations would have incurred.

[Anne McLaughlin]

I need to put on the record that I am not for one minute suggesting that in those circumstances, when someone has done all three things, that person has done nothing wrong. However, not all of these people fit that category. Is it just a coincidence that not a single person who has been refused a visa on that basis is white? Is it just a coincidence that 70% of them are Pakistani nationals? What is the explanation for that?

[Kevin Foster]

I will come on to our response to the Migrants’ Rights Network report in a moment. However, to be very clear, in each instance it is the evidence in the case and not any other factors, such as nationality, that is looked at. Of course, given that there was free movement at the time, those from the European economic area would not have been applying under this type of migration system—again, there is a narrower scope for it.

In response to some of the points made earlier, let us be clear that the principal concern is not tax avoidance—it is not the idea that people have not paid tax on £27,000 of earnings, for example—but visa fraud. It is people effectively saying to the Home Office that they made earnings that meet this bar that they did not actually make—not that they did not pay tax on significant earnings. Just saying, “HMRC did not take action, so neither should the Home Office” misses this rather crucial point.

Particular reference was made to paragraph 322(5). It does not relate only to serious criminality or terrorism; it has always had a much broader remit, including an applicant’s general conduct in the UK, which unsurprisingly has always formed a part of immigration decision making. The courts consistently agreed that the use of paragraph 322(5) was appropriate in cases in which applicants failed to give any convincing explanations of discrepancies in the earnings for which they had claimed points. Yet, to touch on the point made earlier, as part of our new immigration system we have been overhauling and simplifying the immigration rules, so this paragraph will no longer apply to future applications. Under our new rules, we no longer group criminality and terrorism together with issues such as conduct or false representation, which is a clearer approach. However, those were not the rules that applied at that time.

I am aware of the recent report by the Migrants’ Rights Network suggesting that only people of certain Commonwealth and former Commonwealth nationalities are being refused. Sadly, the Migrants’ Rights Network has not shared its data with us. However, our own data show that the six nationalities mentioned in its report accounted for 68% of all people in the tier 1 general route since 2010. The same nationalities represent 65% of those granted settlement in the route since 2010. What difference exists relates to the greater proportion, for whatever reason, of applicants of these nationalities who relied on self-employed earnings, rather than earnings via pay-as-you-earn, in their applications. Our approach is therefore is to examine each case individually, look at all the evidence on its merits and not make assumptions based on an applicant’s nationality or any other attributes. We have strengthened our processes further since the Court of Appeal judgment in the Balajigari case to avoid any possibility of procedural unfairness.

For those investigations that we have concluded, we have found that, in a small minority of cases, applicants have provided new and more credible evidence of their earnings, and their cases have now been granted. In all others, we are carrying out a balancing exercise, weighing any false representations that applicants made in the past against any compelling reasons for allowing their stay in the UK in spite of this conduct. Where there are strong grounds for doing so, we are granting these applications. We have also supported applicants through the process and given them extra time to provide evidence, especially when their ability to do so has been affected by the pandemic.

Turning to the queries about the approach for highly skilled migrants in the future, we are looking to implement an unsponsored route. We are going to learn very clearly from the issues and problems of the previous tier 1 route, especially the issue of how earnings were declared to the Home Office. We will shortly provide details of the new route in the forthcoming innovation strategy, and I hope Members concerned to avoid these issues will be reassured by what they read.

We will not ignore the actions of those who sought to play the system by inflating their earnings to seek an immigration advantage, but we will ensure that all applicants are treated fairly, based on the individual circumstances of their cases, and given a fair opportunity to rebut any queries about the earnings they have declared to HMRC and the Home Office. However, no one should be surprised that we check each other’s notes.

Question put and agreed to.

11:30

Sitting suspended.