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Annual report on labour market

Immigration and Social Security Co-ordination (EU Withdrawal) Bill – in a Public Bill Committee at 12:30 pm on 18th June 2020.

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“Within 12 months of this Act coming into force, and every 12 months thereafter, the Secretary of State must lay a report before Parliament setting out how any changes made to the Immigration Rules for EEA and Swiss nationals have affected the extent to which UK employers have adequate access to labour.”—

This new clause would mean the Secretary of State must lay a report before Parliament on how changes to Immigration Rules for EEA and Swiss nationals are affecting access to labour.

Brought up, and read the First time.

Photo of Stuart McDonald Stuart McDonald Shadow SNP Spokesperson (Immigration, Asylum and Border Control), Shadow SNP Spokesperson (Attorney General)

I beg to move, that the clause be read a Second time.

I can be relatively brief, since we covered much of this territory in earlier discussions, but it is a useful opportunity to push the Minister on a few issues. What progress can he report on raising awareness of the new tier-2 procedures in which so many small and medium-sized enterprises will have to participate, and what support is being rolled out for those businesses to help them to navigate the new system? What change has he noticed in the number of applications for tier-2 sponsorship licences, and what work is under way to streamline the system, which we have spoken about at length previously?

I suspect the Minister’s answer to the new clause will be that there is to be an annual MAC report. If so, can we ask that it is laid before Parliament and then have a debate on it? The Home Affairs Committee spoke about an annual debate on migration in a repot two or three years ago in trying to build a consensus on migration. It looked at how other countries developed immigration policy, and one issue that featured heavily in other jurisdictions was, at the very least, an annual debate on immigration policy generally.

We are talking about seismic changes to the way in which many businesses will go about recruiting and accessing the labour market, and the number of industry bodies that have come to me to express concerns is unbelievable—industry bodies I did not even know existed until they got in touch—across food and drink, agriculture, tourism and hospitality, fishing, manufacturing, engineering, logistics, financial services, social care, education, and many more. There is significant apprehension, and it is not because any of these industries want to exploit low wages; it is their realistic assessment that they are struggling already to access the labour they need in the UK at a price they can afford and which keeps them competitive. Now they are going to struggle to access labour from abroad, because of immigration rules.

We have spoken about the salary threshold on a number of occasions, but we have not said much about the skills threshold. It is welcome that it is lower than it was in the original White Paper, but there is no route for those in jobs below regulated qualifications framework level 3. That excludes those in many roles in which we have a high vacancy level, notably heavy goods vehicle drivers and care workers. Sectors such as hospitality, tourism, food and drink and agriculture are particularly concerned about how they will recruit the people they need, and I fear that the Government will come to regret removing the one-year visa in the original White Paper proposals, rather than listening to concerns and improving it.

The concerns expressed by business also arise from an assessment that even if jobs are at the required skill and salary thresholds and businesses can access the labour that they need, there will still be significant costs and red tape. This is all happening when businesses need it least. It will not be an issue for the huge multinationals in London, which are well used to the tier 2 system, but it will be a huge challenge for small and medium-sized enterprises in every single constituency represented in this room.

The Minister says he is confident that everything is in hand, that the shortage occupation list will be more efficient, and that the system will be streamlined, but we need much more detail, and we need action. The Home Office is being reckless in pushing ahead at this time, but let us have a proper report and a debate, so that we can decide what the impact has been, and can assess whether the right decisions have been made and how we go about building immigration policy for the future.

Photo of Holly Lynch Holly Lynch Shadow Minister (Home Office) 12:45 pm, 18th June 2020

I lend our support to the new clause. I anticipate that the Minister will reflect on the developments with the MAC, in that plans are afoot for an annual assessment of labour requirements across the UK, which will influence our immigration approach. However, I echo what my friend from the SNP, the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East, has said. We would very much welcome that report being placed before both Houses, so that there can be further debate across this place.

We have called for reports on the sectors we are most concerned about, which we have debated and discussed this morning, but there will be so many others. As with any change like this, there will be unintended consequences. We want the opportunity to mitigate the impact of the end of free movement, and to debate that in Parliament. That would, we hope, lead to much more dynamic decision making on changes to mitigate the impact of the ending of free movement on further sectors. We welcome the new clause.

Photo of Kevin Foster Kevin Foster The Parliamentary Under-Secretary of State for the Home Department

I thank the shadow spokespeople for their comments and the constructive way in which they have put forward the new clause, which hits on an important point. Certainly neither I nor anyone else in government wants businesses to fail due to an unavailability of labour, although, sadly, as many outside this room would note, the impact of covid-19 on our economy means that not many people would see that as a likely issue over the coming period, for all too obvious reasons.

It is precisely for that reason that the Government are bringing forward the new points-based immigration system. It will be a single global system that will treat everyone alike and will allow people to come to the UK on the basis of their skills and the contribution they can make, not their nationality or where their passport is from. It will be a fair system, and we are introducing a number of important elements, such as reducing the skills and salary threshold below those in the tier 2 system, and abolishing the cap and resident labour market test, which will remove a lot of bureaucracy for employers engaging with the system.

The system will also be flexible. We are making it points-based, precisely so that we can facilitate the entry of those with the greatest skills or those who are coming to fill jobs where there is the greatest need. The system will be kept under careful review.

I do not think anyone would disagree that it is profoundly important to look at the effect that immigration is having on the labour market. That means looking at the situation for employers and the impact on UK workers seeking employment. The new clause, focusing as it does solely on employers, would give only one side of the story, leaving workers’ interests at a disadvantage. I also do not believe that the Government are best placed to look at this issue; this type of request is why the independent Migration Advisory Committee exists and is commissioned to produce expert, independent reports on the interplay between immigration and the labour market. I do not believe that what it produces could be further improved by another report from the Government. As part of its work, the MAC already looks at which occupations in the UK are currently experiencing a shortage of workers and, crucially, where it thinks it would be beneficial to fill vacancies through immigration. We maintain shortage occupation lists to recognise that.

The work of the MAC and the reports it produces go beyond the narrow scope of the work proposed by the new clause. The MAC looks at the whole immigration system, rather than just changes to the immigration rules. The MAC also looks at the impact of all migration, rather than limiting itself to EEA and Swiss migration, as the new clause seeks to do, although I accept that the wording is probably because of the scope of the Bill. The future immigration system will be a global one, where an EEA citizen has the same basic rights to migrate to the UK as someone, for example, from the Commonwealth.

The new clause would simply result in duplication of work already being undertaken by the pre-eminent labour market economists and migration specialists of the MAC. Parliament regularly debates the MAC’s reports. I hope that the MAC’s annual reports will help to inform regular, structured debates on migration—something to which Opposition Members alluded—allowing us to take a more considered view, rather than simply reacting to particular proposals or events. I have outlined the role that the MAC will play. I hope that the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East will feel able to withdraw his new clause.

Clause, by leave, withdrawn.