Post-study Work Schemes

Debate between Pete Wishart and Stuart C McDonald

Thursday 8th December 2016 Westminster Hall

[Stuart C. McDonald (Cumbernauld, Kilsyth and Kirkintilloch East) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Rosindell. I warmly congratulate my hon. Friend the Member for Perth and North Perthshire (Pete Wishart) and his new colleagues—the fresh talent—on the Scottish Affairs Committee on their excellent work on this important issue and on bringing this debate to the House.

I thank all hon. Members for their contributions today. All of them, in their own eloquent way, added to the convincing—indeed, overwhelming—case for reintroducing the post-study work visa in Scotland. It is really an open-and-shut case. In short, reintroducing the visa would be good for our universities and students, for business and the economy and for Scotland—for the country as a whole.

On the first point, we have heard already how non-EU international students are of great value to Scotland’s universities and the economy. Each year, they bring in about £444 million in fees alone and an estimated £488 million in off-campus expenditure—not all, I hope, in the pubs of the hon. Member for Edinburgh South (Ian Murray). Universities Scotland has calculated that Scotland has lost out on at least £254 million of revenue since 2012 as a result of the closure of the tier 1 post-study work visa. That figure does not include the considerable additional economic benefits from highly skilled international graduates contributing to the Scottish economy after university.

We should always remember, however, that in addition to the positive economic benefit from attracting these bright international students, they contribute immeasurably to the quality of the educational experience for all students. Domestic students and staff are exposed to different perspectives, contributing to their international experience and the development of critical thinking. International students create a more culturally diverse environment.

On the second point, hon. Members have highlighted how important retaining some international students here can be for business. They broaden the skills base and bring new ideas and links. In 2014, about 25% of all job vacancies in Scotland were hard to fill because of a shortage in available skills. That was up from 15% in 2011, and the closure of the post-study work route has certainly not helped in that regard.

On the third point, hon. Members have spoken about how Scotland as a whole benefits from a post-study work scheme, not only because of the demographic challenges that we face—an issue to which I will return shortly—but because attracting international students is, as my hon. Friend the Member for Inverclyde (Ronnie Cowan) said, key to a nation’s soft power. Scotland and the UK as a whole would benefit by gaining a vast network of global ambassadors among our international alumni.

Against that background, the very bad news is that removal of the post-study work scheme has had a substantial impact on the ability of students to remain in the United Kingdom after graduation. As my hon. Friend the Member for Perth and North Perthshire said, last year only 7,000 international students from across the UK made the transfer from tier 4 to tier 2; in 2011 that figure was close to 50,000, so there has been an overwhelming drop of more than 80%.

The case for a post-study work scheme for Scotland is therefore a powerful one. Unfortunately, the response from the UK Government has been hugely frustrating. Their arguments just do not stack up. The Government argue that international student numbers have remained steady or even increased slightly since the post-study work scheme ended, but, as my hon. Friend said, that misses the point. There is no doubt that we could have attracted even more students with a post-study work offer that was commensurate with what our rivals in other English-speaking countries such as Australia, New Zealand and Canada offer. As my hon. Friend the Member for Rutherglen and Hamilton West (Margaret Ferrier) pointed out, Scotland has seen a 59% decrease in the number of students from India since 2009-10. Indeed, the year after the post-study work route closed, recruitment of students from India fell by 26% in a single year. In their argument on the numbers, the Government miss another point: in Scotland, not only do we want students to come, but we want some of them to stay afterwards, and the current system has impacted on that severely.

The Government also argue, on the basis of a small and imperfect evaluation report, that the Fresh Talent scheme had flaws. I agree with my hon. Friend the Member for Perth and North Perthshire that the scheme was a great success, but as my hon. Friend the Member for Dundee West (Chris Law) said, no one is arguing that it was absolutely perfect. The point made by the hon. Member for Edinburgh South was absolutely right: we should not ditch a whole scheme on that basis but address its imperfections, improve it and make it work.

The principal argument is that a significant number of students graduating from Scottish universities then went to work in other parts of the UK. However, the key point is that the visa did not prohibit that happening. Those students were doing absolutely nothing wrong, so the answer is simple: make it a formal condition on the face of the visa that the person lives and works in Scotland. That should be no more difficult than making it a condition of a person’s visa that they study on a particular course or work for a particular employer.

The Government argue that there is already a competitive post-study work offering, but the UK post-study work offer barely exists, in that there are basically four months of additional leave after graduation in which to find a job that qualifies for tier 2. That does not remotely compare to the offerings of competitor countries in north America or Australia and New Zealand.

I could spend my whole speech discussing why tier 2 is not working well for Scotland in particular; my hon. Friend the Member for Perth and North Perthshire also touched on that. Our small and medium-sized enterprises are at a significant disadvantage in complying with the rules and regulations, compared with the big multinationals that make full use of them in other parts of the UK economy. Suffice it to note—as my hon. Friend did—that just 6% of tier 2 sponsors are in Scotland and Northern Ireland compared with 62% in London and the south-east, so the rules are working for London. However, it is not just Scotland that is struggling to compete—other parts of the UK are losing out as well.

[Pete Wishart]

I am glad my hon. Friend picked up on the point about 62% of tier 2 sponsors being in London and the south-east. That area does not require the international students, so I am pretty certain that he would agree that we should try and make the situation equitable across the United Kingdom and incentivise people to come to Scotland. That surely reinforces the call for regional variation on these issues, so that we can get international students in Scotland and not where they are probably not required—that is, in London and the south-east.

[Stuart C. McDonald]

My hon. Friend is absolutely right. This is not just about Scotland—Northern Ireland, Wales and parts of England are struggling to compete with London. The one-size-fits-all rules are set according to the economic needs of London and the south-east, so an extra couple of months, as is offered in the Government pilot scheme, will not alter the position. As other hon. Members have said, the failure to include any Scottish universities in that pilot was a slap in the face and a political own goal.

The Government are trying to defend the indefensible. I will close with two broader points. First, as has already been touched on, this is ultimately being driven by the Prime Minister’s obsession with the net migration target, which is making her pick the low-hanging fruit—in other words, international students. In fact, the current Home Secretary has tried to ditch or water down the net migration target—I think she probably knows it is a nonsensical target. We also know that both the Foreign Secretary and the Chancellor think that students should be taken out of the net migration target. The Home Secretary was asked about this issue three times on Monday, but she dextrously avoided saying whether she agreed with her colleagues. Perhaps the Minister will answer instead: does he agree that, if we are to be stuck with this ludicrous net migration target, the target should exclude students? While we are at it, there is a strong case for excluding Scotland from the net migration altogether as well.

My second broader point is about what this debate means more generally for Scotland’s population. The post-study work visa is significant for Scotland but, in another sense, it is just a smaller aspect of a much bigger question about the extent to which the UK Government are prepared to consider particular immigration rules for Scotland. That question is of immense importance. As hon. Members have said, our demographic needs are different, as the Committee’s report highlighted. The challenge for Scotland has now become growing the population and retaining the proportion of our population that is of working age. If the Government are not even going to engage meaningfully on post-study work, what chance do we have of meaningful engagement on broader issues about managing Scotland’s population?

Government must come to terms with the idea that different parts of the UK can have different immigration policies. The idea is not novel—Australia and Canada do it and the Minister has often said that there is a different shortage occupation list for Scotland, so it can be done—and its time has come. An important forthcoming example is the issue of free movement. If free movement of people is not to be retained for the whole United Kingdom, the Government must quickly get working on how it can be retained for some parts of the UK, including Scotland. As my hon. Friend the Member for Edinburgh North and Leith (Deidre Brock) said, if the Government do not get that message, then to put it mildly, they are playing with constitutional fire.

In conclusion, I know that the Minister met with Minister Alasdair Allan from the Scottish Government yesterday afternoon. I do not expect the Minister to perform a 180-degree U-turn today, welcome as that would be, but I expect and hope for more than a straightforward “No”. I expect a genuine willingness to engage, negotiate and resolve the impasse that has developed not just between the UK Government and the Scottish Government, but between the UK Government and Scotland’s universities, businesses, trade unions, students and civic society—all of Scotland, essentially.