A senior Minister recently told ConservativeHome that labour from abroad has become a drug that housebuilders in Britain cannot get themselves off – with deleterious consequences. On the one hand, he said, many homes being built would not go up were firms unable to import labour from EU countries. On the other, they are built slower than they might be, because housebuilders are under little pressure to use new time and labour-saving techniques deployed by some of their equivalents elsewhere in Europe. Why should they be, when they can continue simply to draw on the pool of EU labour made available by free movement?
His example is an illustration of the tensions at the heart of immigration policy. Yes, immigrants work, help meet the needs of business, pay taxes and thus contribute to public spending. But the flow of money coming into the exchequer is all but cancelled out by the flow that then goes out, in order to fund the school places, hospital demands, housing, rail, road and infrastructure that the new immigrants require. Yes, migrants help to meet the immediate needs of business. However, as Ryan Bourne has argued on this site, “immigration has boosted average wages by a small amount, but squeezed them slightly for those near the bottom”. Yes, Britain is close to full employment, and there is no reserve force of unemployed people waiting to fill jobs presently undertaken by immigrants. But there are the economically inactive, people who want to upskill, older people who might want to return to the labour market, and younger ones who might prefer to work than study were more opportunities available.
What should be decisive is the view of voters. And, as Sunder Katwala put it on this site earlier this week, “around two-thirds of voters would support a system that delivers the control over low-skilled EU migration demanded in the referendum, through an annual quota, while remaining open to the skilled EU migrants that our economy needs”. That this was the verdict of voters last year is indisputable: Lord Ashcroft’s post-poll research found that it was the second most important factor. In short, they want EU immigration reduced, though a move from more foreign to more domestic labour will take time if there is not to be a knock-on effect on short-term growth.
The sum of a draft post-Brexit Government plan for EU migration leaked to the Guardian (now, there’s a surprise) is to do exactly that: namely, reduce the number of lower-skilled EU nationals, with a transition period in place, and replace them with domestic labour. The reaction from what we might call the immigration-industrial complex – after Eisenhower’s military-complex – is as predictable as the choice of Fleet Street paper for the link. There is a cluster of bigger employers and University vice-chancellors and liberal academics who have either a financial interest or an emotional commitment or both in keeping the present system going. The shock of the referendum result, an attachment to New Labour’s migration legacy and Michel Barnier’s clock, ticking on towards March 2019, is causing some members of the complex to lose their sense of proportion. “Why stop there?” tweets the Guardian‘s Martin Kettle of the outline. “Force EU nationals to wear yellow star and write European on their clothes, homes, businesses.”
Labour’s reaction is cooler, which may be significant. The paper reports Diane Abbott, no enthusiast for lower immigration, as saying that the draft is “not yet government policy” – and not much more. Some in the party will be very nervous of frightening off voters in the more migration-sceptic Midlands and North, some of whom are recently returned from UKIP, or who are vulnerable to being peeled off by the Conservatives. Yvette Cooper, who chairs the Home Affairs Select Committee, says that the draft seems to contradict Amber Rudd’s recent request to the Migration Advisory Committee for evidence to inform the new policy.
Cooper has a point (although the document itself notes that it is a draft, not a blueprint). There are claims that the Home Secretary is unhappy with the draft from her own officials. This is apparently because it was drawn up not to meet her requirements, but those of Theresa May – and this difference has unhappy echoes of the Prime Minister’s experience in her long and, to date, unsuccessful attempt to get net migration down. During her period as Home Secretary, she faced the combined opposition of the Treasury, the Business department and, up to a point, the Education department too as she struggled to squeeze the numbers. To lose the Home Office in her endeavours would be a blow to the Prime Minister, who would be left with little institutional support for them outside Downing Street. ConservativeHome was very dubious about the Migration Advisory Committee exercise when it was launched, pointing out that it should be informed by the views of all voters – and not just by those of businesses (or some of them).
Within government, the detail of the outline plan should be debatable, but its direction should not. The referendum gave a clear signal that migration from the EU should be reduced. May promised to act on it in her manifesto, and her party is in government. She needs the Home Office to continue to act as a counterweight to departments whose focus is short-term growth rather than longer-term requirements. Which means that she needs a Home Secretary who will ensure that it does so – and a Migration Advisory Committee report that ranges more widely that accounts of its original brief.