Immigration and Social Security Co-ordination (EU Withdrawal) Bill (Fifth sitting)

Alison McGovern Excerpts

Tuesday 26th February 2019 Public Bill Committees

[Alison McGovern (Wirral South) (Lab)]

The Minister has just given the game away. The manner in which people will be treated will largely depend on what the Government see as their interest with regard to trade deals. They are telling people that there will be a level playing field, but that is a misnomer because people’s rights will be highly dependent on the Government’s whims relating to the incentives in future trade deals.

[The Chair]

Before I call the Minister, this is a good opportunity to remind members of the Committee that interventions should be short and to the point. There will be plenty of opportunities for Members to catch my eye if they want to make a longer contribution.

--- Later in debate ---

In the meantime, and in conclusion, it seems that the European temporary leave to remain visa, combined with clause 1, leaves us with a system that is not fit for purpose. It will create extra bureaucracy for the Home Office, without giving it any more grip on who is here legitimately if there is no mechanism by which employers or landlords, for example, are expected to check. It troubles me that the Home Office is adding another burden to its administration systems, which will not help it to process the settled status scheme, which we all welcome, as smoothly as possible. For that reason, I feel strongly that it would be premature to endorse clause 1 now. It causes me deep concern, and I hope the Minister will respond to the points I have raised.

[Alison McGovern]

I join colleagues in thanking the Clerks and the team for the work they have done. I will make a few remarks, particularly about the economic arguments sometimes made for clause 1. I have no doubt that we will spend much time debating some of these points, but let us start as we mean to go on.

On the timing of the Bill, I profoundly agree with my hon. Friend the Member for Stretford and Urmston. It seems bizarre that anyone would think it acceptable to remove, with one clause of this Bill, an entire set of rights that all citizens in this country enjoy by reciprocity with the European Union, and that European Union citizens enjoy in this country, and to replace them with nothing but the promise of a White Paper. There is no set timescale for the introduction of any new immigration system, so we are saying to people, “All your current rights will be removed and will be replaced at some point in the future. We don’t know when, and we don’t know what the new rights will be, but bear with us while we sort it out.”

[Nick Thomas-Symonds (Torfaen) (Lab)]

Can my hon. Friend think of any realistic argument why, given that the Government say they want to guarantee the rights of EU nationals, they would not simply do so now, in clause 1?

[Alison McGovern]

I can think of a reason: because they want to take decisions on these rights based on negotiating interests and the potential gain they might get for their agenda. It seems clear that that has always been the manner in which the rights of EU nationals would be treated. I am afraid warm words are not enough. It is perfectly reasonable—and something I would expect every member of the Committee to be able to do—to say that we personally feel no animus towards EU nationals and that people are welcome in this country. However, it is one thing to say those words and another to do what is necessary to guarantee that they are true. I can think of no reason why the Government would not do as my hon. Friend has suggested.

[Nic Dakin (Scunthorpe) (Lab)]

Does my hon. Friend agree that the fact that this is not dealt with in the Bill as clearly as it could be is unsettling for not only EU nationals but businesses? It interrupts business continuity in a way that is not helpful to the UK economy.

[Alison McGovern]

I agree with my hon. Friend, who makes a good point. I never thought I would be in Committee lecturing the Conservative party on the needs of British business, but we are where we are. My hon. Friend the Member for Stretford and Urmston made the point very well that we are creating not simplicity but an extraordinarily high level of uncertainty, and uncertainty is costly to the British economy. I am sure we will discuss the costs of the Brexit process during the Bill, but the Government could be handling the Bill better. They could have come up with the immigration White Paper long before they did, and we could have spent time in the past two and a bit years since the referendum discussing that very thing, but they have held off and postponed—and here we are now. People have no real idea what situation EU nationals will be in after the end of March. That is utterly intolerable.

[Kate Green]

My hon. Friend makes an important point. Does she agree that the result is that businesses are already experiencing labour shortages, because the uncertainty means EU nationals are already choosing not to come to this country to work? I was told the other day by a food processor in my constituency that there is particular pressure now in the haulage sector.

[Alison McGovern]

I hear the same evidence that my hon. Friend does. We represent constituencies in the same region, so that is not unexpected. Many people will respond that it should be fine, as there are plenty of people in Britain, and plenty of British people can do those jobs. However, unfortunately, that is to misunderstand the labour market. We have an ageing population. What, as we heard in evidence to the Committee, is the answer, according to those who want to put up the border and stop people coming here to do the decent and dignified thing by working in our country? It is to raise the pension age and ask people to work into their 70s. That is all right for people who do a desk job that is not physically taxing, but I do not really want to ask nurses whom I represent to work until they are 71 or 72. I do not think that would be appropriate. My hon. Friend made a good point.

My hon. Friend also talked about lack of simplicity in the new system. The Minister mentioned simplicity several times and the Law Commission will look into it. That is a good thing—and it is not before time. However, the fact is that free movement, like it or not, provides people with rights that are simple to understand and exercise. If we are to replace that system with a new one we had better have a good idea now—today—how we will give people an equal, or hopefully better, level of simplicity. For all the reasons that my hon. Friend mentioned, making people’s lives simpler in that way is vital. It is the best way to make sure that the economy can innovate and move forward. I find it hard to understand why the Government should move clause 1 at this point, without a guarantee of an equally simple, or even simpler and better understood system.

[Kate Green]

Again, my hon. Friend makes a powerful point. This is about simplicity not just for business and our economy, but for families who will now not be clear about the basis on which family members can come to this country to live with them.

[Alison McGovern]

I thank my hon. Friend for that intervention. She is right, and we have all spent time in our surgeries with distressed constituents who are dealing with complexities faced by their families. No doubt all that personal and human cost comes across the Minister’s desk, and I know she treats such cases with empathy and kindness. If we are to replace a system that is simple and straightforward for people to understand, and means that they can plan family life and get on with the things they want to do without constant interference by the Government, a better option should be on the table than the one we currently have—I never thought I would have to lecture the Tory party about the perils of a Government interfering unnecessarily in people’s personal lives, but there we are.

Some people talk about the economic impacts of immigration and say that ending free movement was what caused the referendum result. As has been said, however, that is questionable because free movement was not on the ballot paper, and we do not really know.

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

Does the hon. Lady agree that there is a huge degree of confusion about freedom of movement, and that it is conflated with the rest of immigration and asylum policy? That is not helped by a lack of knowledge in this country about how the European Union works and operates, and how we approach such issues with the EU. The direct impact on people in the UK, and on their ability to travel freely across the EU to work, travel and be educated, was not known, so we cannot possibly say that the UK voted to end freedom of movement.

[Alison McGovern]

I thank the hon. Gentleman for his intervention. It is entirely possible that people do not know all the ins and outs and details of the immigration system—I would not expect them to; it is quite complicated. Having stood in three general elections in a swing marginal seat, I suggest that anyone who thinks they can be involved in British politics and not get involved in conversations about immigration is kidding themselves. We must accept that immigration is an issue, and that people will seize on anecdotes and their own personal experience. That is not illegitimate either—people rely on their lived experiences, but when it comes to decisions that we take, it is a mistake to rely on anecdote and we must consider the actual evidence for what immigration has done in our labour market.

In 2015, one Bank of England study found that immigration had had a very small effect on the wages of those at the lower end of the earnings distribution, but that that effect was not significant. Often that study is seized on as evidence that immigration has somehow had this huge impact on people’s earning potential, but I simply ask people to compare that with what we know has happened to wages since the financial crash of 2008. Compared with the trend of 2% annual growth in real wages from 1980 to the early 2000s, which was pretty regular, between 2008 and 2014 people’s real wages fell significantly, with a shortfall of about 20% in what they would otherwise have expected had that real wage growth continued.

If we consider groups in our society, apart from pensioner households, no one is better off than they would have been in 2008. The significance of that impact while we have been in the European Union demonstrates that what has happened is a change in Government policy and the decisions that have been made to support people’s incomes. Real wages have been weakened by rising inflation since the 2016 referendum, which has had a huge impact. Depreciation will lead to rising costs. In the end, when considering people’s earnings potential, what matters is not the nominal figure of the amount they have coming in, but what they can buy with it.

I would say to people who worry about the impact of immigration on wages that we should definitely consider it. It is true that most of the studies that have investigated this matter have found that, at the local level, there is no statistically significant impact of immigration on the earnings of those in that local economy. However, if that is considered so important that it ignores the impact of prices and what has happened since the referendum, that is not being serious about dealing with poverty in this country. We need to understand that if we tell people that we will make the average British person better off by restricting immigration, we are offering a false promise.