Immigration

David Mowat Excerpts

Thursday 18th November 2010 Commons Chamber

[Mr Lilley]

In a moment, as I want to finish answering the point that was raised.

I am not suggesting that certain categories of skilled workers could not be used during a temporary shortage while domestic employees were being trained, or that there could not be a skills transfer when the skills that were required could not, by their very nature, be acquired domestically or through training. We have traditionally allowed companies to import workers for the purposes of skills transfers when the skills concerned are company-specific.

Let us say that IBM is setting up a factory here. It has an IBM way of doing things. Initially, it will need to bring in the IBM accountant to show British accountants how to run the accounts and the financial system. Those running the production line may have to bring in IBM production engineers to train British engineers in their ways of doing things. It is not possible to buy such company-specific skills on the market; they must be imported temporarily. However, because the people who have transferred the skills invariably return, the transfer does not result in net migration. That is very different from allowing cheap skills into this country.

In a blog that is influential in the IT industry—here I declare an interest—the author of the Holway report constantly hammers home the fact that we are moving slowly towards circumstances in which fewer and fewer entry-level jobs are available in the industry. Last year 9,000 skilled IT workers were brought into the country by a handful of companies under the intra-company transfer scheme. That is not transferring skills from a company to domestic residents; it is importing cheap labour. However, we allow it, although as a result the IT sector has one of the highest rates of unemployment in industry. The Government must think seriously about the issue, and must not form policy on the basis of slogans such as “Skilled work is good” and “Open border to skilled workers”. That is not good in the long run if it means that fewer of those who are already here acquire skills, experience and expertise.

[David Mowat (Warrington South) (Con)]

Using the analogy of the IT industry, my right hon. Friend has pointed out that unemployment exists, and that there is a demand from a small number of companies for a large number of people to come into the country. The corollary is that, in a process called outsourcing, we move jobs to other parts of the world. That is just part of being a free trade country. If we wish to position ourselves as leaders in terms of free trade, as the Prime Minister said 10 days ago, the corollary is a degree of freedom of movement. There has been a massive skills failure in the country over the past decade and a half. Most of the 180,000 entrants are for STEM subjects—science, technology, engineering and mathematics. If we are unable to train people ourselves, it behoves us to allow them into the country in a way that benefits us.

[Mr Lilley]

My hon. Friend’s intervention prompts a number of questions. For instance, why do we not train people?

For a while I was chairman of a small German company as a result of a merger, and the first thing that we did was bring in British employees to train its employees. It is considered automatic: every company, even a small company with only 200 employees, trains people. Sadly, that culture does not exist in this country. All that we think of doing is importing people from abroad, or possibly stealing them from our competitors down the road. At least if we steal them from our competitors down the road, we have to bid up the salaries for the particular skill involved. We encourage more people to acquire that skill, and as a result increase the number of people with such skills in our economy. However, the idea that we should assume passively that this country alone in the world cannot train people to acquire skills that semi-developed countries seem to be able to train their people to acquire strikes me as a defeatism that is sad and deplorable.

I hope we will recognise that there are some skills that we should allow into the country: entrepreneurial skills, for example, I rather doubt whether entrepreneurship can be taught. Some people are natural entrepreneurs while others are not. That is fair enough: if someone has proven success as an entrepreneur abroad, we should let him in, with some of the capital that he has acquired. Only a small number of people will be involved, however. That is not mass immigration. It will generate a lot of jobs and it is a sensible thing to do, so let us do it. However, we must distinguish between those sorts of skills and the sorts of skills we can enable the existing population of all ethnic origins to acquire, so that the well-being of those already here improves.

--- Later in debate ---

[David Mowat (Warrington South) (Con)]

I apologise in advance to the House for the fact that my remarks may appear less entertaining and somewhat more low-key than the previous exchange. I am also aware that we are nearing the end of the debate, so I shall be fairly brief.

I was particularly taken by two speeches that seemed to sum up the elements that we are trying to reconcile. First, we heard about the real concerns that are expressed to all of us by constituents who are decent people and, in many cases, members of ethnic minorities about the level and velocity of immigration and the impact that it has on our population levels. According to a quotation supplied to me by a Sikh gentleman in my community, given that the current level of net immigration is about 200,000 a year, our population will number 71 million in a decade and a half. That is about 10 million more than it is now. His point was that if that is what the Government wish to do to the country, they should at least ask us. Debates of this type give us a chance to discuss such issues. The pressure on services that is caused by such extensions of the population was described very eloquently by my right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley).

The counter-argument was presented in a very good speech by my hon. Friend the Member for Finchley and Golders Green (Mike Freer). Our country is in the vanguard of globalisation. We are the country that goes to summits and always takes the position that protectionism is bad, that world trade must increase and that the velocity of world trade is good for us.

The difficulty we face is in reconciling two key forces. Some of the issues involved in the subject under discussion, such as those caused by the temporary cap, arise from the difficulty that can occur in reconciling the concerns that my hon. Friend the Member for Finchley and Golders Green said were held by the business in his constituency with the genuine concerns that so many people have about the number of people coming into the country.

I have three observations on how we might reconcile the two competing forces. I now understand that policy will be announced in a week’s time, so my comments might come a little too late to influence that. On intra-company transfers, organisations such as GlaxoSmithKline, Shell, Accenture and IBM need to move people around. They cannot always plan how they do it, and they do not even consider individual jurisdictions or boundaries as being particularly relevant in profit and loss terms. They have to be able to undertake such transfers quickly and if we were to facilitate that, we could gain a competitive advantage. Britain could then become the place for projects that involve people coming together to work. In my business career, how quickly that could be done was a very big issue.

Academia is a second, and related, area. We have heard a lot about the impact of the temporary cap on academia. It is true that if we wish our society to become less reliant on financial services, much of our success will depend on applied science and engineering and on how well we address those subjects at university and transfer knowledge into wealth. We are in a global market, and we need to be able to treat it in a global way.

I was struck by something I recently learned about the Wellcome Trust. It needed to hire a zebra geneticist team leader. It was not able to do that without advertising in the local job market in Cambridge. Members will not be surprised to learn that there were no applicants for the job, and Wellcome was subsequently permitted to recruit by other means. That is a cumbersome process, and we need to do better.

[Mr Frank Field]

Does the hon. Gentleman not know that the opposite also happens? Jobcentres have reported to me that companies have gone through such a procedure and accidentally found the person they are going to appoint.

[David Mowat]

I am sure that is true, but I do not think it undermines the point I am making. Two wrongs do not make a right.

Finally, I want to consider why we are in this situation in the first place. Nine out of every 10 non-EU immigrants coming into the country are given work permits. That means that, on the face of it, they have a skill or a talent that we do not have here. Why do we not have it? I contend that one of the reasons is that over the last decade and a half we have completely failed to equip our work force with the skills needed for them, and for us as a country, to prosper in the decade of advanced manufacturing, STEM-type activities, and all that goes with that.

Some 30 years ago, I studied engineering at university. Last year, five times as many people graduated than when I graduated, but there were fewer engineering graduates from UK universities. That is a large part of the reason why so many organisations need to go abroad to find staff, and therefore cause some of these issues in the first place. I had an exchange with my right hon. Friend the Member for Hitchin and Harpenden on this during his excellent speech. Of course we have to put pressure on organisations and companies to train people better, and of course it is an easy option just to go abroad to hire the graduates companies need, but there is a chicken-and-egg situation here; we have to do both. Unfortunately, over the last decade and a half, we have not.

I thank the right hon. Member for Birkenhead for securing the debate.

Question put and agreed to.

Resolved,

That this House calls on Her Majesty’s Government to act on the overwhelming public concern about the present scale of immigration by taking firm measures to reduce immigration without excluding those individuals who are genuinely essential to economic recovery, on which so much else depends.