Non-EU Citizens: Income Threshold

Paul Scully Excerpts

Monday 7th March 2016 Westminster Hall

[Paul Scully (Sutton and Cheam) (Con)]

I beg to move,

That this House has considered e-petition 118060 relating to the income threshold for non-EU citizens settling in the UK.

It is a pleasure to serve under your chairmanship, Ms Vaz. I want first to read out the petition so that people who read the debate in Hansard later can see what we are talking about. It is entitled “Scrap the £35k threshold for non-EU citizens settling in the UK”. It goes on:

“In April (2016) the Home Office and Theresa May are introducing a pay threshold for people to remain here, after already working here for 5 years. This only affects non-EU citizens that earn under £35,000 a year, which unfairly discriminates against charity workers, nurses, students and others.

This ridiculous measure is only going to affect 40,000 people who have already been living and working in the UK for 5 years, contributing to our culture and economy. It will drive more workers from the NHS and people from their families. This empty gesture will barely affect the immigration statistics. It’s a waste of time, money and lives.

This is the first time the UK has discriminated against low-earners. £35k is an unreasonably high threshold. The UK will lose thousands of skilled workers.”

I will now return to using my own words; my own views may be slightly different. I should add that the Select Committee on Home Affairs has considered the issue as part of a wider report on skills, and on how the tier 2 and other visa categories affect skilled workers coming into the country, to which the Government responded in February.

I have been a member of the Petitions Committee since it was set up in May, and the petition before the House is one of a number that have hit the public’s imagination since the e-petition system began. However, from memory, I think this is the first pro-immigration petition to be debated. I have led on one that wanted a stop to all immigration now; and we had a quite interesting discussion about a certain Mr Trump, relating largely to his comments about immigration in the US. This is the first to look at immigration from a positive point of view, and to deal with a specific part of immigration policy. I hope that we will have an interesting debate on how the policy affects people, the contribution that people make when they come to this country and bring their skills here, including economically and culturally, and what we need to do to control mass uncontrolled immigration. I think that there is, largely, consensus that we always need to do more to address that.

I have a few general concerns about the wording of the petition, which are the sort of thing I would say to anyone considering putting something on the e-petition website. Some of the wording was not what I would have chosen—such as referring to a “ridiculous measure” and saying that it

“is only going to affect 40,000 people”.

I think a lot of people who are concerned about immigration will say that 40,000 is effectively just over 10%—about 15%—of the current net migration figure, which is quite a lot. It is quite a high percentage that the Government are looking at, when we are talking about trying to control immigration as a whole.

[Mr Steve Baker (Wycombe) (Con)]

Will my hon. Friend confirm that the Government cannot apply such a measure to European Union citizens precisely because we are European Union citizens and are consequently prevented from discriminating in the matter of free movement of EU citizens? Does he agree that it would be better, fairer and more just to everyone if we operated migration on the basis of British citizenship, so that we could treat people fairly, wherever they came from?

[Paul Scully]

I very much agree and will speak about that later. I think we are acting with one arm tied behind our back within the structures of our immigration policy.

The petition also calls the policy an “empty gesture”, which

“will barely affect the immigration statistics.”

However, if we are talking about 40,000 people, it will do more than that. I do not think it is a waste of time. The petition says:

“This is the first time the UK has discriminated against low-earners. £35k is an unreasonably high threshold.”

I suspect that the debate will tease out the various types of occupations that may or may not be affected.

[Carol Monaghan (Glasgow North West) (SNP)]

Of course, the occupations that will be affected are key to the debate. It will not be possible to recruit nurses, or teachers of science, technology, engineering and maths, from abroad. Gaping holes in those areas will not be filled.

[Paul Scully]

The hon. Lady is second-guessing what I was going to say, because I contend that the shortage occupation list, which is the second part of the tier 2 visa rules, takes that into account. Although the petition goes on about nurses, they are on the shortage occupation list. It also mentions charity workers, who tend to be dealt with on tier 5 visas, for temporary workers; and students, who tend to have tier 4 international student visas. Therefore there are a few factual inaccuracies in the petition, but none the less there are some real concerns within various occupations, and it is right that the people in question should make representations so that we can consider them. We should bear it in mind that the Migration Advisory Committee regularly looks at the list, and it is important that it should continue to do so.

[Margaret Ferrier (Rutherglen and Hamilton West) (SNP)]

The economy relies on a wide variety of skills, and not all are paid at similar rates. Does the hon. Gentleman agree that a banker in the City will earn much more than, say, a classical musician? The blanket application of one threshold for all industries is inherently unfair.

[Paul Scully]

If that were the case, then yes, it would be, but I think that is where the shortage occupation list comes in. For example, a classical ballet dancer has an exemption of £20,800 and so will not be affected by the £35,000 limit. The threshold is far lower. I cannot say what the market rate is for a classical ballet dancer, but there are such exemptions. That is why it is very important that the Migration Advisory Committee should keep the list under regular close inspection and review, covering such examples as the hon. Lady has mentioned.

Tier 2 is intended for skilled workers. The majority of reasonable people—if we can get past the people who say we should stop all immigration now—would consider immigration to play a positive economic and cultural role in the country. We bring in some fantastic migrant entrepreneurs and, as has been said, nurses, as well as pharmacists and people who work in the cultural industries such as music, dance and the arts. Those people contribute to the UK and the fabric of the country. In some cases they do jobs for which we cannot find the skills in this country, and they can help to train and upskill our own citizens.

[Martin Docherty-Hughes (West Dunbartonshire) (SNP)]

In response to an intervention by the hon. Member for Wycombe (Mr Baker), the hon. Gentleman talked about extending the policy to European Union citizens. Would he allow other European Union member states, where 1.26 million UK citizens live, to do the exact same to UK citizens?

[Paul Scully]

At the end of the day, when we talk about the European Union, we are talking about being able to control our own borders. We are talking about the skilled people we want in this country. My personal view is that I would like the UK to leave the EU, in order to get skilled people from other countries across the world. However, in the context of our debate, the best we can do is look at tackling immigration from outside the EU, work out the skills we need and the various industries that need particular help from outside, and work through the tier 2 visa rules in terms of the threshold and the various exemptions we have talked about.

[Mr Baker]

Does my hon. Friend agree that the key point is that the burden of proof lies with those who wish to continue to discriminate against people who are from outside the European Union, in favour of people from the European Union? That is the crucial point. The EU puts us in a position where we are discriminating against non-EU citizens; that should end.

[Paul Scully]

Yes. I have dealt with the curry industry—this may sound slightly random, but bear with me for a second. A lot of people representing that industry complain of the fact that two curry restaurants a week are closing down, out of the 10,000 or so around the country. There are lots of different reasons for that, one of which is that the restaurants are failing to attract skilled chefs. The associations and the trade bodies tell me that the restaurants can hire an unskilled person from another European country; that person can therefore come over here and get a job at the expense of a skilled chef with experience from, say, Bangladesh.

[Carol Monaghan]

In what way would raising the pay threshold to £35,000 alleviate that problem?

--- Later in debate ---

[Paul Scully]

Frankly, it would not, which is why I am not going to make that case. Leaving the EU would mean that we did not have to pinpoint all our immigration policy on tackling immigration from outside the EU, which at the moment is the only lever we have to pull. We cannot do anything about immigration from within the EU because of rules on the free movement of people. People from, say, Bangladesh or India—countries that are going to dominate the world economy for the next few decades—are therefore at an unfair disadvantage to unskilled people from within the EU. I was therefore not going to make that case.

The threshold will apply only to workers in graduate occupations. Given the way our skills and skills agenda have changed over the past few years, more and more occupations are falling into that category. Years ago, nurses did not need a degree, but now they do, as nurses are taking on more and more responsibilities—responsibilities akin to those of doctors, in many cases. They are highly qualified and highly skilled, and rightly so. We certainly need to ensure that we can attract the very best nurses to this country.

Any employer that wants to take someone on under the skilled work category needs to carry out a resident labour market test, in order to prove that the job cannot be filled from within our domestic market. PhD-level jobs are exempt, and as I said, shortage occupation list workers are also exempt.

[Martin Docherty-Hughes]

The hon. Gentleman mentioned the domestic market. Would that exclude Ireland, with which we have had a free movement agreement since the early 1920s, and every Irish citizen?

[Paul Scully]

That is an interesting point. All I was saying about leaving the EU is that we would have control of what we do. We have had control of what we do with Ireland for a number of years, well before we were members of the European Union.

The Migration Advisory Committee looked at this issue in December 2015 and recommended a salary cap of about £30,000. It acknowledged:

“The Government’s core objective is to significantly reduce the level of economic migration from outside the EEA.”

The Prime Minister has made it clear that the Government’s focus is on training domestic workers. That is the right long-term plan. I talked about curry chefs earlier. I know that the Government have talked about setting up training colleges, apprenticeships and that sort of thing. In the long term, that is absolutely the way to go. The curry industry and a number of other industries have struggled to get to grips with and adapt to the change in Government policy over the past few years. Those industries have been trying to push against the changes, but now that the rules are starting to come in and bite, they have realised that it is too late to make changes that they could have made over a number of years.

Even if the Government do not reverse their policy, I hope that they will be understanding and sympathetic to these industries, working with industry leaders and trade bodies to ensure that, where possible, compromises can be made to help the industries cope. The curry industry that I keep talking about is worth £3.5 billion to the UK economy and employs around 100,000 people. It would be a tragedy to see a UK industry of that level wither on the vine.

Tier 2 has a role to play. When I was campaigning, immigration was certainly the No. 1 issue on the doorstep. It came up time and again. Everybody was saying to me, “You know what? We need a points-based system.” Well, we have one; we have had one since 2008, and the tier 2 visa system forms part of that process. To work out whether someone can get a tier 2 visa, they need to be able to show their income, and information in a number of other categories, and they then get points on the basis of that information.

Several Members here will have received the briefing from the Royal College of Nursing. I know that the threshold is of concern to the RCN, and nurses have already been mentioned today. I am glad that nurses are on the shortage occupation list; that is important, especially when we are trying to recruit more nurses and bring more of them into the national health service. Obviously, it takes time to train nurses, so we have to find them from somewhere. According to the RCN, 3,365 nurses would have been affected if they had not been on that list. The shortage occupation list has to iron out unintended consequences, but it still provides the default position that the UK should supply its own workforce wherever possible. That is the right thing to do.

We must bear in mind that the tier 2 visa system is only one tool in controlling immigration. The Government have done a number of very good things on immigration, such as closing down 920 bogus colleges, slashing 45,000 visas from the further education route, cutting family visas by a third, restricting access to public services through the Immigration Act 2014 and cutting abuses of those services. All those measures have had an effect, but there is still more we can do, and we must do so for the reasons I have given.

There are only a certain number of avenues that the Government can control. The issue of unskilled labour from the EU is not one of them, unfortunately. The UK economy is the biggest pull factor for migration. We have talked a lot in debates in the main Chamber about welfare changes, but ultimately the biggest pull factor for migration is the state of the UK economy—it is the fact that we have had the fastest-growing economy in the western world and have been creating more jobs in the UK than the rest of Europe put together. When there is double-digit unemployment in parts of southern Europe, of course the UK will be an attractive place to come, so we need to do more on immigration.

It is important that we have a good debate. We have to keep on controlling mass immigration, which affects infrastructure and can often affect social cohesion. I hope that the Minister will look kindly on some of the industries and occupations that are struggling to keep up with the pace of change, and at least acknowledge that they need comfort, support and the right words, so that they realise that they are valued in the UK economy and throughout our public services. I look forward to a vibrant debate.

--- Later in debate ---

[Kirsten Oswald]

I do. The measures could cause difficulties in many sectors, including the one that my hon. Friend mentions.

This policy seems to be more about portraying an image than the effect that it will have. Even its proponents admit that it will have little, if any, effect on the actual level of immigration to the UK. In its initial report on this topic, the Migration Advisory Committee said that

“it is likely that, to some extent, migrants prevented from staying beyond five years will be replaced by new migrants.”

[Paul Scully]

Does the hon. Lady not consider 40,000 fewer people coming to the UK to be a reasonably significant reduction?

[Kirsten Oswald]

I point the hon. Gentleman to what I said before; there will be churn, with people coming in and out of the UK.

The Migration Advisory Committee went on to say that

“the impact on the UK migrant stock of applying a pay criterion will probably be lower than…estimates suggest.”

Indeed, the Home Office’s own impact assessment talks of the policy potentially leading to a “churn of migrant inflows”.

Many commentators have expressed reservations about applying such a simplistic measure as a single pay benchmark to the granting of settlement. Many of the consultees see the need for greater flexibility than is reflected in the Government’s policy. Perhaps not surprisingly, I find myself in agreement with the Scottish Government, who, as my hon. Friend the Member for Rutherglen and Hamilton West (Margaret Ferrier) said, have criticised the crude use of wage levels, because many essential occupations are not necessarily well paid. In addition, as the Scottish Government and others have pointed out, there are significantly different wage levels across the UK. In most cases, people with the same occupation and the same skill level are paid different amounts in London, for instance, compared with other parts of the UK.

The Migration Advisory Committee report on the impact of the policy highlights the fact that only London has a mean wage for graduate occupations that is higher than the UK average. All other nations and regions are below the average—in some cases considerably so. The spread from the mean graduate wage in London to that in Wales is more than £15,000, and it is difficult to see how a standard wage requirement of £35,000 for tier 2 applicants for residence can meet the needs of all areas. The notion that there is a single UK economy and demography, which can be managed by one-size-fits-all policies, is a fiction that should have been abandoned long ago. Of course, it is possible to construct models and reports that treat the UK as a single economic entity, but that does not make the whole UK the appropriate level at which to apply policy change. It is a long hard struggle to get this House to recognise that.

Since devolution, Scottish Administrations, regardless of party, have highlighted that our demographic experience does not match that of the rest of the UK. No country with which Scotland shares either a land or sea border has seen such low population growth, but as with other issues of particular interest to Scotland, this place has shown a long-term lack of interest in the causes of that relative decline. In 2000, Scotland’s population was lower than it had been in 1970. By contrast, the rest of the UK, Ireland, Norway and Iceland had all experienced significant population growth over that period. The coincidence of a booming oil industry off Scotland’s shores with population stagnation represented gross mismanagement of Scotland’s economic potential. Other parts of the UK, outwith London and the south-east, have experienced similar problems.

It was disappointing to see just how little consideration the Migration Advisory Committee gave to the regional impact of the policy. When we see that the committee contains seven members, none of whom are based north of Birmingham, we perhaps get some idea of their perspective. With three of the committee members either currently working at the London School of Economics or having studied there, it begins to look like a committee with a particular outlook and remit. With the growing level of devolution of economic decision making across the nations, regions and even the cities of the UK, there is no justification for such an influential committee reflecting so narrow a perspective on such a vital topic as immigration policy.

Given the importance of demography, and particularly the impact of work-related migration on the economic future of all parts of the UK, it is vital that a wider perspective is brought to bear on this issue. Perhaps the UK Government will live up to their promise of treating devolved Administrations with respect and put the question of immigration rules and the make-up of the Migration Advisory Committee on the agenda of the Joint Ministerial Committee. I would welcome confirmation from the Minister that he and his colleagues in the Department will consider that.

--- Later in debate ---

[Patrick Grady]

Absolutely. An ageing population and a declining birth rate have disproportionately affected Scotland and various regions of the United Kingdom. That goes back to my point about immigration policy being designed to placate voters and political parties in parts of the country that do not have such a situation.

Bodies in a number of sectors have expressed a wide range of concerns about the policy. The Government have responded to some extent to the concerns expressed by the Royal College of Nursing and others about the impact on the health service, but my understanding is that the proposal to put nursing into a skills shortage category will be temporary, with no guarantees about what might happen in future.

We have heard about the impact on other sectors that rely on special skills but do not necessarily pay above the £35,000 threshold. My background is in the international development charitable sector. People come to that sector with a whole range of skills and experiences, but £35,000 is a pretty high salary in such a field.

We have heard quite a bit about the catering industry. I was reminded of a video that was doing the rounds on social media at the weekend: the famous Rowan Atkinson sketch from the 1980s in which he speaks as a Conservative politician saying, “Well, you know, we welcome these people from different parts of the world, and they brought us exotic cuisine such as curry, but now that we’ve learnt the recipe, there is no real need for any more of them.” That was supposed to be satire, yet here we are hearing exactly that sort of sentiment expressed by today’s Tory Government.

I have just come from the all-party group on music’s live music briefing. Our creative sectors benefit hugely from people being able to come into the country to share their expertise, drawing on our rich cultural heritage and bringing their own. Again, £35,000 is a significant salary in those sectors, especially in the early years of work. My hon. Friend the Member for East Renfrewshire (Kirsten Oswald) made a point about churn in such sectors. As a result of the policy, people might come for five or six years and then have to leave, only to try to come back 12 or 18 months down the line.

[Paul Scully]

Does the hon. Gentleman agree that whether it is in the catering industry, the music industry or any other industry, the Government’s default position on lower-paid jobs should be to train our own people first, and then to attract the skills we need beyond that?

[Patrick Grady]

Yes, but those things need not be contradictory. People can come here with specific skills, and learn, develop and share their skills in different ways. The system will allow people to be here for five or six years precisely to develop professional skills and, hopefully, work their way up the ladder, but if they do not meet the arbitrary threshold they will face having to leave the country, forcing potential employers to start again, ultimately with more cost. The Government’s paper on the issue, signed on 14 March 2012 by the Minister who was responsible at the time, states that there will be a reduction

“in economic output—estimated at £181m to £575m over 10 years”.

Even the Government’s own estimate is that the policy will have a negative impact on the economy, but clearly they believe it is a price worth paying to hit their arbitrary target.

The impact on the economy, society and culture as a whole is important, but so is the impact on individuals. I suspect that all of us—certainly all SNP Members—have had constituents in similar circumstances. If they are not directly affected by the income threshold, they are certainly victims of other pernicious aspects of the UK Government’s immigration policy.

The first time I was drawn to ask a question in Prime Minister’s questions—in fact, the only time—I raised the case of my constituent Steve Forman. I do not expect the Minister to have the details in front of him, but Dr Forman is a highly skilled musician, percussionist and teacher at the Royal Conservatoire of Scotland. He did not meet a particular income threshold, so he was being forced out of the country. He was not costing the taxpayer a penny. He was earning an income on which he was paying tax. He has access to a private income from his considerable years of work and experience around the world. He was a musician for David Bowie, among many of his contributions, yet the Home Office saw fit to try to deport him. That is what is costing the taxpayer money. A fortune is being spent on appeals, tribunals and further legal processes. My constituent could have been allowed to stay in the country. He is still here, but with a massive question mark over his appeal, which seems to be snarled up. I do not expect an immediate response from the Minister, but a letter telling us where we are with his case would be much appreciated. That is but one of the many examples that come to our surgeries daily.

Immigration is essential to the strength of our economy and greatly adds to the social and cultural fabric of the country. This proposal is, sadly, one more aspect of an ideologically driven Tory policy that is all about pulling up the drawbridge irrespective of the needs of the economy and society across the United Kingdom. When I raised the case of my constituent at Prime Minister’s questions, I said that if the UK Government did not want to introduce an immigration policy suitable to Scotland’s needs, they could devolve immigration powers to Scotland and let us develop a policy that would work in Scotland’s interests.

Our vision is of a fair and sensible system of managed migration, with a measured strategy to make the most of the huge benefits that immigration can bring to the UK and Scotland. That stands in stark contrast with the Conservative approach. I have no doubt that we on the SNP Benches will continue to stand up for that, whether in Westminster Hall or during discussion of legislation on the Floor of the House.

--- Later in debate ---

[Richard Harrington]

I agree that this country has benefited significantly from immigration, in labour markets and in every other aspect of life. It is true that a significant level of net migration comes from the EU —172,000 people in the year ending September 2015. However, what is often not said—I am sorry that my hon. Friend the Member for Wycombe is not in his place at the moment, but I hope that my hon. Friend the Member for Sutton and Cheam will pass this on—is that an even larger amount, 191,000, is the result of non-EU net migration. The Office for National Statistics estimated that there were 67,000 non-EU long-term immigrants for work, an increase of 2% compared with the previous 12 months.

[Paul Scully]

Just as a full stop on the European point, we have talked a little about the fact that the threshold may apply to European citizens. If we left the EU, the threshold might not apply in quite the same way, because we would have greater flexibility within our immigration policy.

[Richard Harrington]

I do not think anyone could dispute that we would certainly have greater flexibility if we were not in the EU, but many of us would argue that the benefits of being in the EU are so significant that that would be a small point. For the record, that includes me; I totally agree with that view.

It should also be placed on record that numbers of those using tier 2, the skilled work route, have increased by 35% since 2010. Even if we were not experiencing high levels of migration from the EU, I argue that we would still need to reform the rules leading to such large population flows into the UK. I have dealt as much as I can in this debate with the EU issue. I have certainly given the Government’s view, which—luckily for me —coincides with my personal view on these matters.

In the past, it has been too easy for some employers to choose to bring in workers from overseas rather than invest in training for our existing workforce. On average, employers in the UK underinvest in training compared with those in other countries, with a marked decline over the past 20 years. In an increasingly global economy, it is not surprising that many skilled workers come to the UK for a short time to fill a temporary skills gap, or perhaps to experience work in another country, but—this is an important point—reducing migration is not just about reducing the numbers coming here. It is also about being more selective in who we allow to settle permanently. In 2015, some 44%, or nearly half, of all migrants granted settlement in the UK—

--- Later in debate ---

[Paul Scully]

It is a pleasure to serve under your chairmanship, Mr Rosindell.

We have had a good and constructive debate, and I think that we all agree on the benefits, both economic and cultural, of immigration. I am the son of an immigrant. My father moved to England from Glasgow, where he completed his apprenticeship on the docks, but he was born in Burma. I have therefore seen the good side of immigration, but mass uncontrolled immigration, when it affects infrastructure and social cohesion in some areas, needs to be tackled. It is important that we see the tier 2 visa situation as one of a range of elements in the Government’s armoury for tackling that.

I thank everyone who has contributed to the debate. Very interesting points have been made, and I know that the Minister will take away hon. Members’ reflections, especially those of Scottish National party Members, who have taken time out to make their points eloquently. I pay tribute to the petitioners themselves, who encouraged so many people to sign a petition about which they feel so strongly, and also to those people on Facebook—mentioned by the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East (Stuart C. McDonald)—who engaged with the process that we, as the Petitions Committee, started in the lead-up to the debate, so that we could hear directly from people who believed that they might be affected by the policy, or had concerns about it. Their points have definitely been listened to and taken on board.

I am sure that the debate will run and run. When we talk about petitions, we always say that they are the start of a process, the start of a campaign and the start of raising a profile. They should not be seen as a full stop, as a final move. I am glad to have been able to put people’s voices across today, and I thank everyone who has contributed.

Question put and agreed to.

Resolved,

That this House has considered e-petition 118060 relating to the income threshold for non-EU citizens settling in the UK.