European Union (Notification of Withdrawal) Bill - Second Reading (2nd Day) (Continued)

Part of the debate – in the House of Lords at 5:22 pm on 21st February 2017.

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Photo of Lord Hollick Lord Hollick Chair, Economic Affairs Committee, Chair, Finance Bill Sub-Committee 5:22 pm, 21st February 2017

My Lords, the Prime Minister has decided that gaining control of our borders to reduce migration from the EU is to be the central plank of her Brexit strategy. From that decision, much else flows. We are to depart the single market and the customs union and avoid the unwelcome oversight of the European Court of Justice—except, the White Paper goes on to say, in those sectors of our choosing where we do not wish to depart and, indeed, plan to remain in the single market and the customs union. It remains to be seen whether this desire for, shall we say, a relationship on the side on terms of our choosing after the marriage has ended will survive the inevitable turbulence and recrimination of the divorce proceedings or whether it is perhaps the triumph of hope over experience.

The conflicts inherent in this approach speak to the fundamental truth that the UK’s economy is, and will continue to be, inextricably intertwined with the EU, our largest market. Yes, we will over time build stronger relationships with countries outside the EU—we will rediscover the Commonwealth. However, for the foreseeable future, our economy will have to depend upon the continuing strength of our relationship with the EU and, in one important area, our reliance upon the enormous contribution made to our economy and society by migrants from the EU. The Office for National Statistics estimates that 3.3 million EU citizens live in the UK, of whom 2.1 million are in work. Important sectors rely upon their continuing contribution: 30% of the workforce in the food processing industry and 17% in the hospitality industry come from the EU; 170,000 EU citizens work in the NHS and residential care homes; 200,000 work in the construction industry. It is quite shameful that these citizens and their families—a good number of whom have been resident in the UK for many years—should have any shred of doubt whatever about their rights to remain here.

Securing those rights is one of the dozen principles set out in the Brexit White Paper, but it is not too late to give a pre-emptive commitment to those citizens and recognise and match the commitment they have made to our country. That they have been designated the status of negotiating chips is repugnant. If, as a result, they decide to leave, it will damage our economy and our reputation and be a massive own goal. The White Paper acknowledges that we will always want immigration, and it rightly asserts that openness to international talent must remain one of our distinctive assets. At the same time, the White Paper wants to design a migration system to control the number of people coming into the UK according to quotas based on the Government’s assessment of sectoral needs.

Are cumbersome state-planning quotas to help control migration likely to work? The omens are not good. In her five years as Home Secretary, Mrs May failed each year to achieve her net migration target of 100,000. The largest contribution to her failure was not the free movement of people from the EU but the migration from outside the EU, where work permits favour her degree of control. As a former Home Secretary, she knows only too well that information on migrants, including details about their participation in the workforce, is patchy and wholly inadequate to provide the basis for effective management and control. In the absence of better information and improved systems, control of migration risks becoming a blunt and bureaucratic instrument, unresponsive to the many and changing needs of our economy and of society more generally.

Let us be clear: we need not only to retain 3.1 million people from the EU who live here already; we also need to attract new EU migrants to help the UK economy to prosper. For instance, the Housing White Paper targets an increase in home building of 100,000 a year. To reach that level, the construction industry estimates that it will need 500,000 additional construction workers. The Chancellor’s welcome decision to increase infrastructure investment by £23 billion during the life of this Parliament will add further to the demand for skilled and semi-skilled labour.

What is clear is that for the foreseeable future we will need more—not less—immigration, and not only the brightest and the best, who feature heavily in the White Paper, but also those with less glamorous but essential skills to help deliver a growing economy. The Government must be honest about this. At the same time, they must commit and come forward with moves and investment to put more resources into increasing our own national skill base.

The heated and divisive dialogue about migration—which, if anything, has grown more rancorous since the referendum—provides scant reassurance to those from the EU and from countries outside the EU who have made their homes here, and it may deter those living in the EU who might otherwise consider coming to the UK. The best, the brightest and the skilled have choices, and unless our words and our actions speak to the enthusiastic welcome we want to extend to them as fellow citizens, they may choose not to join us. In every respect, we will be the poorer for their absence.