Immigration

Paul Blomfield Excerpts

Wednesday 11th December 2013 Westminster Hall

[Paul Blomfield (Sheffield Central) (Lab)]

It is a pleasure to contribute to this debate under your chairmanship, Mr Howarth. I am pleased to have the opportunity to speak. Although I speak from the Opposition Benches, I am not in the business of defending everything that the previous Government did in relation to immigration, but frankly, the suggestion by the hon. Member for Isle of Wight (Mr Turner) that the decisions that we made about the A8 accession countries—which we recognised were a mistake, and perhaps arose from listening too closely to the calls of the business community and its desire for free movement of labour into the UK—were some sort of ideological plot to transform the nature of our society is perhaps something that is better placed in the pages of the Daily Mail.

Let me describe a personal experience. Last Friday, when I was conducting one of my regular advice surgeries, I was talking to a Romanian citizen currently living in the UK. She is a student and is making a significant contribution to our local economy in Sheffield. She was volunteering for AIESEC, which is a student society committed to promoting business, finding business placements, developing skills in an industrial and commercial context and growing global-minded entrepreneurs. She was enthusiastic when she came to Britain, but she was deeply depressed by the public discourse around Romania and Bulgaria and their citizens, which made her feel unwelcome. I think we need to take care how we debate the issue, not only for her sake and others’, but also for the sake of all those UK citizens who have raised concerns, of which all hon. Members have experience, about immigration. They deserve proper leadership from us as politicians, which means being honest about the facts and coming up with the right solutions to the real problems.

I have some sympathy with the Minister. He was right a couple of weeks ago to talk down the fear of a mass influx of Romanians and Bulgarians. He will not be surprised, however, that I have only some sympathy. Much of the problem has been created through the Government talking up the problems of migration for political advantage. We need an honest debate. We have heard a lot of noise, some of which was reflected in the speech by the hon. Member for Isle of Wight, about benefits for newly arriving EU migrants. The impression being given is that EU migrants are freeloaders who come simply to claim our benefits and to exploit our generosity. However, all the evidence, as I am sure the hon. Gentleman knows, suggests that EU migrants make a net fiscal contribution.

A study was published last month by the centre for research and analysis of migration—CReAM—at University college London, which is one of our country’s greatest universities and one of the world’s leading universities. It concluded that recent immigrants—those who arrived after 1999, who constituted 33% of the overall immigrant population in 2011—were 45% less likely to receive state benefits or tax credits than UK natives. Over the same period, recent European economic area immigrants have on average contributed 34% more in taxes than they have received in transfers. By contrast, over the same period, the total of UK natives’ tax payments were 11% lower than the transfers they received.

We welcome the most talented migrants. In 2011, 32% of EEA immigrants and 43% of non-EEA immigrants had university degrees. The estimated net fiscal contribution of immigrants increases even more if we consider that immigration helps to share the total cost of fixed public expenditure among a larger pool.

The main reasons for the large net fiscal contribution of recent EEA immigrants are their higher average labour market participation than UK natives and their lower receipt of welfare benefits. Professor Christian Dustmann, the director of CReAM and the co-author of the study, said:

“Our research shows that in contrast with most other European countries, the UK attracts highly educated and skilled immigrants from within the EEA as well as from outside. What’s more, immigrants who arrived since 2000 have made a very sizeable net fiscal contribution and therefore helped to reduce the fiscal burden on UK-born workers. Our study also suggests that over the last decade or so the UK has benefited fiscally from immigrants from EEA countries, who have put in considerably more in taxes and contributions than they received in benefits and transfers. Given this evidence, claims about ‘benefit tourism’ by EEA immigrants”—

that myth—

seem to be disconnected from reality.”

Another example of the Government talking up the migration issue but introducing measures that damage the economy by targeting the wrong issue is on the issue of international students. The Minister will not be surprised to hear me speaking about that again. I agree that the Government are right, as were the previous Government, to clamp down on bogus students who not only are exploiting our system, but are themselves in many cases exploited by bogus colleges. However, overall, international students bring huge benefits to the economy.

Oxford Economics conducted research on behalf of the university of Sheffield, which looked at the students’ net contribution after all costs to public services—such as traffic congestion and everything else it could think of. The survey was published in January 2013 and showed that during the previous academic year the 8,000-plus international students at our two universities made a net total contribution of more than £120 million to the Sheffield economy. Probably about 6,000, 7,000 or 8,000 local jobs depend on those students. Furthermore, the net benefits generated by the indirect supply chain advantages were assumed to account for approximately an additional £22 million to the local economy. International students obviously bring further external benefits, such as boosts to demand as a consequence of increased familiarity with locally produced goods and the potential for our status as a city and a country to be boosted by the relationship that they build while they are in the UK.

International students are a growing market internationally. The Department for Business, Innovation and Skills has calculated that by 2020 the market could double. Instead of being worth £8 billion to our economy, it could be worth £16 billion; instead of 6,000 jobs in Sheffield, it could be 12,000 jobs. Currently, international student numbers are flatlining, while our competitor countries are taking advantage of some of the measures that this Government have put in place. We should be concerned about that.

The hon. Member for Isle of Wight expressed concerns about things that are happening in the labour market. My concern is that he did not focus on the things that can be done to address issues in the labour market. The Minister for Immigration made a useful contribution before the Home Affairs Committee this week when he was challenged about a statement from the head of Domino’s Pizza about why it was unable to recruit sufficiently from within the UK domestic work force. The Minister rightly made the point that the company should perhaps look at its employment conditions and wages. It would be helpful to consider positive labour market interventions that can create the sort of level playing field that the hon. Member for Isle of Wight seeks.

[The Minister for Immigration (Mr Mark Harper)]

To be clear, it is worse than the hon. Gentleman suggests. The chief executive of Domino’s Pizza was not arguing that he could not recruit in the UK alone. He was arguing that he could not recruit enough people from the whole EU labour pool, and that we needed to start importing low-skilled workers from outside the EU in order that he could keep low wages in his business. That is why I said he perhaps ought to reflect on the terms and conditions. So he was arguing that we should have an unrestricted free-for-all, but I do not think it is the role of Government policy to let multinationals keep wages low when, frankly, they should pay their staff a little more.

[Paul Blomfield]

I agree entirely with the Minister on that point. We should ensure that multinationals pay wages that will attract people to do the jobs. We should also ensure that companies do not recruit exclusively from eastern Europe, as they seek to do. Jobs should be available to local workers in the market. We should also do more to ensure that companies that flout the minimum wage rules are prosecuted. The number of businesses that are fined for employing illegal workers has halved, plummeting from more than 2,000 in 2009 to a little more than 1,000 in 2012. We can talk positively about those sorts of labour market interventions to address many of our concerns.

I will conclude by commenting on something that the hon. Member for Isle of Wight said about a constituent, who is concerned about the way in which their community has been transformed by the influx of migrants. I am sure that if we look back in 50-year snapshots, we will find that people have always expressed such concerns. I am sure that they expressed concerns about my wife’s family, who came across from Ireland to supplement the work force in the UK. I was brought up in Sheffield in the 1960s and it was a relatively monocultural city. The city in which I have brought up my son in the 1990s is stronger, richer and better for having welcomed people from around the world—some to build better lives, some fleeing persecution. I am proud that we are the country’s first city of sanctuary.