Good morning, Mr Fell. The Bill Committee will now hear your oral evidence. I am sorry about the technical hitches; you will be on your own, not with Make UK.
Thank you very much for agreeing to give evidence today. If you would like to briefly introduce yourself, we can move straight to questions. We have about 10 minutes.
Q I will ask one question, because of constraints of time. How do you see your members working with the proposed new migration system?
I think our members completely understand that free movement of people is ending. Business gets that, and it is ready to phase into a new immigration system. I think, with the proposed approach of a points-based system, it is entirely possible to design a system that works for business. There are many positives in it so far—the headline salary threshold changes that have been announced and the commitment to streamline and improve the system are all positives—but I would say that there are perhaps three areas of concern for our members at the moment.
One concern is the absence of any route at all below level 3, which will prove challenging for the care, hospitality and logistics sectors and so on. The second, from the Government’s perspective, is introducing this with a phased approach; I can perfectly see where they are coming from, but it means that business will be left with a reasonably cumbersome system from the off, with a promise of improvements to come. The third is that we are getting very close to the deadline for the system being introduced, and business is still looking for further clarity, time to prepare and assurances that the system will be ready in time. Those are the concerns, against a backdrop of an effort to really make this work and lean into it.
BearingQ in mind what you have just said, what are the things that you would really like changed about the Bill? Alternatively, what would the Government need to do to support you to manage the impact that it will have on your businesses?
There are a few things that we would like to see in the proposed new immigration system. We believe that a temporary route for people to come and work in this country would be a helpful addition to the system as it is currently set up.
Secondly, I would say to accelerate efforts to streamline the proposed approach. The vast majority of businesses have never previously had to engage with the visa system; something like only 30,000 businesses in the country have grappled with it so far, because we have lived and worked with free movement of people for so long. It will be a big change, so I would say to accelerate the changes to streamline and improve the system, reduce red tape and so on.
The final piece, just to reiterate, is to accelerate efforts to get clarity and detail out there and known to businesses as soon as possible, so they can begin to familiarise themselves, prepare and get ready.
Q Last year, when you gave evidence to the Bill Committee, you described tier 2 as a
Could you say a little more about what you mean by that?
There are a couple of areas. It comes down to some of the red tape issues, and there are a few examples. The initial sponsor licence, businesses tell us, is very document-heavy, in their words—for example, on the HR practices side, having to evidence, track and monitor things that small businesses feel are perfectly obvious. If they employ 10 or up to 20 people and one person is missing, that is self-evident; they know if a person is not there.
There is quite a lot in the reporting requirements that could be streamlined. Lots of people say to us, “We have to report it if a migrant’s pay has increased, and we don’t quite understand why. If they were already given the green light because they cleared the salary threshold, why would we need to report that that has increased?”
Thirdly, people feel that the volume of documentation required to be kept on file, including details such as notes from interviewing candidates, is quite onerous. Those are some of the examples of red tape burdens that we would welcome efforts to streamline.
Q May I also ask about the costs that will be involved now? How much more expensive will it be for businesses who have never done this before to recruit workers from the EU?
There will be a significant uplift in cost, particularly for businesses that have never grappled with this before. There is an ongoing cost, but there is also a first-time familiarisation effort that will cost more, particularly for small businesses. Larger companies who deal with high volumes of people are likely to have in-house HR and legal expertise. That is much less likely to be the case for small and medium-sized businesses, who will need to pay for external advice to be able to navigate this new system.
Q To turn the question around a little and look at it from the perspective of prospective employees as opposed to employers, if somebody has a job offer in London or Dublin, is there a danger that imposing the tier 2 system is going to make London much less attractive than Dublin, if they are faced by, for example, visa fees and visa applications and immigration health surcharges?
That is an issue. It is an issue that companies will look at, for example, if they were a multinational business and they were choosing the location of business, so it is true from a business perspective. From the employee perspective, it might be down to the speed with which they can get certainty—“Can I go and live there and know that it is okay?” Clearly, there are others who would speak more for the employee perspective, but that would be my perspective on the employee view.
I think it is an important factor. It is quite hard to say exactly where the detail of that lands, particularly in the context of the EU-UK negotiations that are ongoing; we will need to see where they land. Social security measures and the issues that you have just described are really important for reciprocity—not just migrants coming to work in the UK, but UK workers overseas—and that reciprocity is particularly important for mobility of labour as well as for migrants coming to work in the UK.
I think that bringing the skill threshold in the Bill down from degree to A-level is a positive change. That is a highly positive move that the CBI supported and which clearly broadens out the range of roles that can be addressed through that route. The issues are less about whether they can clear a threshold in terms of the work; they are more about the system costs and streamlining the red tape that I was describing. That is what would be most helpful.
Of course, even with that skills threshold reduced down to level 3 or A-level equivalent, that still leaves out many important roles for which businesses will find the transition and the adjustments quite hard to address in the short term.
The regional implications will be down to where there is a particular proliferation of types of sectors within a regional make-up. Some of the ones that we think are quite hard hit are care workers, general labourers in construction and the hospitality sector, as well as logistics. Hospitality is very much a regional industry, and that could be one that bears most of the brunt.
Mr Fell, thank you very much for giving evidence to us. We found that very valuable. I am sorry about the technical difficulties we had getting through to you. We now move to our next witness.