Brexit: UK-EU Movement of People (EUC Report)

Baroness Williams of Trafford Excerpts

Monday 17th July 2017 Lords Chamber

[The Minister of State, Home Office (Baroness Williams of Trafford) (Con)]

My Lords, along with others I thank the noble Baroness, Lady Prashar, for the committee’s report. Several noble Lords have rightly commented that the Government have not yet responded. I am sorry that the Government have not yet been able to provide their response to the report. The process of preparing our response was delayed by the general election, but we will provide it as soon as possible after this debate. I hope that in the interim your Lordships’ House will accept my verbal response to the report, which deals with one of the most important consequences of the British people’s decision to leave the EU. As the report makes clear, the right of free movement of EU citizens is an integral part of membership of the EU, and this will end when the UK ceases to be a member. The Prime Minister invoked Article 50 of the Treaty on European Union on 29 March this year. Negotiations with the EU began in June and we are due to leave the EU by March 2019.

As part of this process, we are considering the options for how our immigration system could work in future, and the committee’s report and this debate will be valuable contributions to that. Indeed, Parliament has a very important role in the whole process of leaving the EU. We have made it clear that there will be a Motion on a final agreement with the EU, to be approved by both Houses of Parliament before it is concluded. Parliament will continue to have its say throughout the process of negotiation with extensive scrutiny and debate, including on the repeal Bill. Our engagement with people, communities and businesses across the whole of the UK is also an essential part of this process. Ministers have led widespread engagement with their sectors, and the Department for Exiting the EU has held a large number of stakeholder engagement events, mainly taking place outside London and right across the UK. This has helped to inform our understanding of the key issues for negotiation. The engagement will continue throughout the period before we leave.

The Government published their White Paper, The United Kingdom’s Exit From and New Partnership with the European Union, on 2 February. It provides a comprehensive articulation of the objectives and rationale for the Government’s approach to the forthcoming negotiations. The Government are approaching these talks constructively, respectfully and in a spirit of sincere co-operation. There should be no reason why we should not agree a new deep and special partnership between the UK and the EU that works for us all.

An early priority in these negotiations is to seek to guarantee the rights of EU citizens who already live in the UK, and the rights of UK nationals in the EU, as soon as we can. On 26 June, the Government published their fair and serious offer to protect the rights and entitlements of EU residents in the UK. This set out that qualifying EU citizens arriving before a specified date would be able to apply for settled status in UK law, meaning that they would be free to reside in any capacity, exercise any lawful activity and access public funds and services. The noble Baroness, Lady Jones, asked whether we should guarantee the rights of the 3 million EU citizens unilaterally. The Government have made clear that safeguarding the rights of EU citizens in the UK is a top priority. Indeed, the Secretary of State for Exiting the EU and officials are in Brussels today negotiating on this. However, it is not just the 3 million EU citizens we need to be concerned about; there are also 1.2 million UK nationals living in the EU. We owe a duty of care to them too, which is why we made clear that rights must be reciprocated by the EU, which is the point the noble Lord, Lord Kennedy, made.

However, the main focus of the report that we are debating today is not EU citizens already living here but those who come to the UK after our exit from the EU. The report contains an interesting discussion of various different ideas for our future immigration system, which the noble Baroness outlined in her speech, ranging from modified versions of free movement to the introduction of work permits and other elements of the rules currently applied to non-EU nationals.

The Government are very much aware of the strong interest in this question, not only in this House but on the part of employers, businesses, universities and the wider public across the whole of this country, as noble Lords have pointed out. Here again I emphasise that the Government are not trying to make up their mind in isolation or without engagement. Nor are we trying to go ahead on the basis of incomplete evidence. Evidence has been mentioned a lot this evening. We are looking very carefully at the options for our future immigration system. We are clear that we will need a fuller picture of the potential impacts of any proposed changes, including those affecting the economy and the labour market. We will build a comprehensive picture of the needs and interests of all parts of the UK and develop a system that works for us all. We will not take decisions until we have gathered this evidence and engaged systematically with stakeholders. The independent Migration Advisory Committee will have a role in this, as the Home Secretary has made absolutely clear.

This means that it is not possible for me to take a definite position today on most of the specific ideas and options examined in the report; nor, indeed, on the ideas suggested in the debate today. We are in listening mode. The precise way in which the Government will control the movement of EU nationals to the UK following exit from the EU is yet to be determined, but we are clear that the free movement directive will no longer apply and the migration of EU nationals will be subject to UK law.

Moving away from free movement does not mean becoming a closed or inward-looking society. The UK will remain a tolerant country that is open for business. We recognise the valuable contribution migrants make to our society—I am one—but in future we will control immigration in the national interest rather than accepting it as an unavoidable consequence of EU membership.

The Committee’s report made a number of points about the robustness of migration statistics. Migration statistics are published by the Office for National Statistics—the ONS—and it has confirmed that the International Passenger Survey continues to be the best source of information to measure long-term international migration. The noble Baroness, Lady Prashar, mentioned the inclusion of students in migration figures. The internationally accepted definition of migration includes all those who move for more than 12 months, including students. My noble friend Lord Cormack referred to this.

[Lord Campbell-Savours]

Are statistics on the removal of EU citizens from the United Kingdom kept anywhere at all?

[Baroness Williams of Trafford]

In answer to the noble Lord’s noble friend on behalf of his noble friend, to unpick it was quite an expensive undertaking. That is the response that I gave his noble friend, but I am quite happy to take that point up with his noble friend if he would like to speak to me about it.

[Lord Forsyth of Drumlean]

On the point on the International Passenger Survey, can the Minister tell the House the size of the sample and what the Government estimate the margin of error to be?

[Baroness Williams of Trafford]

I will come back to my noble friend with accurate figures, but I shall finish my point on the International Passenger Survey because there are other methods of measurement. My noble friends Lord Forsyth and Lord Kirkhope and the noble Lords, Lord Oates and Lord Kennedy, all talked about the accuracy of the migration statistics. We think it is the best method, but exit checks were mentioned. The noble Lord, Lord Bilimoria, made a very impassioned plea for exit checks. The Government reintroduced exit checks in 2015. They are based on advanced passenger records and passport swipes as people go through airports. Last August we published a report on the methodology issues which they raised. I commend the report to the noble Lord, Lord Bilimoria, and to any other noble Lords who have not yet read it and are interested in it. In due course, the exit checks will add to the statistical picture on migration, so between the two methods we will get a better picture of where we are on migration.

[Lord Cormack]

I do not want to put my noble friend, for whom I have very real regard, on the spot tonight, but will she please try to ensure that a document is produced for when we come back in September that gives the real figures and details, because it is just not acceptable for any Member of your Lordships’ House to be told that the cost is disproportionate? That is just not on.

[Baroness Williams of Trafford]

I think I have already offered to meet the noble Lord, Lord Hain. I have the figures for the International Passenger Survey, which show that 800,000 people were interviewed per year.

My noble friend Lord Kirkhope of Harrogate asked me why British citizens are included in net migration statistics. The statistics cover all those who come to the UK for more than 12 months and all those who leave the UK for more than 12 months. This enables those with responsibility for the provision of services to know the likely demand for those services, and therefore it is right that the ONS includes those statistics.

The committee is right to highlight the need to consider the impact of leaving the EU on our economy and the labour market. Officials across government and the ONS continue to draw together evidence and are undertaking a wide range of data analysis covering the full range of impacts of EU migration. We also intend to commission advice from the Migration Advisory Committee. There have been numerous studies looking into the impact of increased migration in the labour market on wages. The Migration Advisory Committee, to which the noble Lord, Lord Green of Deddington, referred, summarised that:

“Studies estimating the impact of migrants on UK wages have generally found little or no impact on average wages. However, in some studies migrants were found to increase wages at the top of the UK wage distribution and to lower wages at the bottom”.


More recent evidence from the Bank of England also suggests that,

“while immigration appears to have a negative impact on occupational pay, the overall average effect is relatively small”.

One of the co-authors of the research has recently emphasised the small nature of impacts, with,

“the biggest impact of immigration on wages”,

seen,

“within the semi/unskilled services occupational group”.

The Bank’s research also suggests there was no additional impact on aggregate UK wages as a result of migrants arriving specifically from EU countries. However, it is worth noting that average wage effects and the impact on individuals can be, and can seem, very different. Even small adverse effects on average wages can be significant for the individuals and families concerned.

We are looking at the need for all types of workers, and we would not wish to rule out any options at this stage. It is right that we consider low-skilled migration as part of the wider picture. It is likely that migrants working in lower-skilled occupations may make lower income tax and national insurance contributions to the UK Exchequer, as they may be receiving lower salaries than more highly-skilled migrants. So clearly this is one issue of many that we will need to consider, as well as understanding how impacts vary across a range of factors and indicators including businesses, sectors, and regions.

The noble Lord, Lord Kennedy of Southwark, talked about the implementation period. The February White Paper was clear that we will avoid a cliff edge for business and migrants and ensure a smooth transition. That is our clear aim, but it is far too early to say exactly what that might look like. The noble Lord asked about the issue of high-skilled versus low-skilled. Future decisions will be based on advice and evidence, as he says, and no final decisions have yet been taken.

The noble Baroness, Lady Massey of Darwen, asked about the position of children. I share her concern for the welfare of children. I know she will shortly be meeting my noble friend Lady Anelay, as she said. The paper on safeguarding citizens’ rights that was published on 26 June made clear that the fair and serious offer that we have made also covers dependants, including children.

The noble Lord, Lord Trees, talked about the shortage of vets following the UK exit. We have made it clear that both the best and brightest will continue to be welcome to come to the UK, and future policy will be based on the future consideration of the evidence. I am sure the veterinary profession will want to contribute to that evidence picture. The noble Lord gave a number of significant statistics, and they will certainly form part of the consideration. The noble Lord also suggested that vets should be on the shortage occupation list. That list is produced by the independent Migration Advisory Committee, and the Government do not act independently of the MAC in this regard.

The noble Lord, Lord Stunell, talked about horticulture and construction facing a labour shortage. As long as the UK remains in the EU, EU citizens can come to the UK to work. Labour market statistics show that there are 171,000 more EU citizens in the UK labour market than a year ago. The noble Lord also asked me whether the Government would consider that construction was a key industry, and when HMG would reply to the Farmer and Morel reports. We absolutely recognise the importance of construction, which is why the Government have invested in skills and apprenticeships. We also need to encourage house builders to move to modern methods of construction. I will write to the noble Lord about the reports that he referred to.

The noble Lord, Lord Trees, asked what steps the Government were taking to make it clear to EU nationals that they are welcome in the UK. We have made it clear that so long as the UK remains a part of the EU, EU citizens have full rights to come here and remain welcome. We have made this point clearly and repeatedly.

The noble and right reverend Lord, Lord Eames, and the noble Lord, Lord Kennedy, make important points about the common travel area between Northern Ireland and the Republic of Ireland, particularly for those who live in the border areas of Northern Ireland and southern Ireland. Maintaining that common travel area with the Republic of Ireland and protecting the high level of operational co-operation that underpins it will be an important priority for the UK in the talks ahead. There has been a common travel area between the UK and the Republic of Ireland for many years—in fact, since before the two countries were members of the EU—and that reflects the historical, social, political and economic ties between its members. We will work to deliver as soon as we can a practical solution that allows the maintenance of the CTA within the Republic while protecting the integrity of the UK’s immigration system. I reassure the noble and right reverend Lord that this consideration is not secondary but incredibly important in maintaining that frictionless border.

The noble Earl, Lord Kinnoull, asked whether the UK was being flexible in negotiations. Of course the UK adopts a constructive approach to negotiation. We want to secure an agreement that works for both the UK and the EU. However, I do not propose to lay out the UK’s negotiating strategy this evening, as the noble Earl will probably understand.

I am running out of time, but I would like to make this last point. The noble Lords, Lord Judd and Lord Bilimoria, and the noble Baroness, Lady Jones of Moulsecoomb, made the point that we are not a popular destination for international students. We are the second most popular destination for international students, behind only the USA. There are over 400,000 international students in the UK, and in answer to the point made by the noble Lord, Lord Oates, about them being welcome, there is no limit on the number of students coming here and we do not intend to impose one. Visa applications sponsored by universities are 17% higher than they were in 2010, while visa applications to Russell Group universities are 48% higher than in 2010. Around 99% of student entry clearance visas are decided within 15 days, and the number of tier 4 students from China has risen year on year.

I have run out of time. I think this has been an incredibly valuable debate. As I have said, we are in listening mode and we have not made up our minds on many of the issues covered. I am grateful to have heard noble Lords’ views, and I hope I have been able to provide some reassurance about the Government’s approach on this issue.