Brexit: UK-EU Movement of People (EUC Report)

Lord Green of Deddington Excerpts

Monday 17th July 2017 Lords Chamber

[Lord Green of Deddington (CB)]

My Lords, I declare an entirely non-financial interest as chairman of Migration Watch, a position that I have held for the last 16 years. Your Lordships will not be surprised to hear that I read this report with very great interest; indeed, I gave some evidence to the committee. A great deal of work has gone into it and it is a very useful basis for further work on a whole range of important issues, some of which have been touched on already. That said, I would like to make three broad points.

First, the report strikes me as something of a missed opportunity. It is surely obvious that in the light of the referendum result the scale of immigration must be reduced, and furthermore that some of that reduction must come from EU migration, over which the Government at present have no control whatever. I suggest therefore that it would have been helpful if the committee had addressed itself more directly to the key policy issue at hand and had been more specific about what might be achieved. Instead, the summary of conclusions states on page 61:

“The Government’s primary objective in putting an end to the free movement of persons appears to be restoring sovereignty … In particular, the Government has thus far stopped short of saying it intends to limit or reduce net migration from the EU, although this can arguably be implied from the ‘tens of thousands’ target for net migration overall”.


I wondered whether the committee was being serious, especially as the report was published before the last election, when there was surely no doubt about the direction of government policy. Indeed, I notice that in the main summary, perhaps written by a different hand, this point is acknowledged. Still, it seems to me that the committee was disposed—dare I say determined? —to avoid considering how immigration could actually be reduced. I know it is a difficult issue but, frankly, I do not think the committee addressed it.

Secondly, had the committee addressed that key issue, it would surely have concluded that the focus of policy should be on the lower-skilled rather than on the higher-skilled. In this context, the report speaks of the need to improve the evidence base for policy. Having said that, it seems to neglect some key and important points. I will briefly mention just three. Just under 80% of the 1.25 million EU workers who have arrived in the UK since 2006 are working in lower-skilled, lower-paid jobs. That is particularly true for those who have arrived from eastern Europe. Secondly, the independent Migration Advisory Committee, well known to Members of this House, has concluded that:

“Low skilled migrants have a neutral impact on UK-born employment rates”—


this is broadly agreed—

“fiscal contribution, GDP per head and productivity”.

So it would be very hard to argue that they are indispensable from a macroeconomic point of view. We will come to particular companies, but the evidence is that the macroeconomic arguments for low-skilled migration from Europe are very weak.

HMRC data released last year showed that eastern Europeans paid on average only half as much income tax as the average UK taxpayer. Further work showed that payment to such workers is roughly £13 million a day. If you were looking for a way to reduce overall immigration, surely you would look at this. It is obvious, and I hope that in future work the committee will do so. Indeed, if the committee had looked at that, it might have asked why the UK taxpayer should subsidise what has been increasing dependence by employers on cheap labour from abroad.

Thirdly, and lastly, this is the background to the proposal that we have made for a work permit regime similar to that for non-EU workers. In our calculation, that would reduce net migration by about 100,000 a year, a major step towards the Government’s objective. Would it result in unacceptable damage to certain sectors of our economy? That depends in part on whether there would be a sudden exodus of the east European workers who now are very important in a number of sectors in Britain.

Here, the committee claimed that there are no data on the turnover of EU migrants. This is a critical point: the committee is wrong. It can be deduced from the Labour Force Survey. We have done that work. We have shown that east European workers have proved to be a remarkably stable population. The number who came in 2006 is now the same, or indeed slightly higher, and so on through that period. This shows that there is very unlikely to be a sudden exodus, although I entirely accept that over time the number will reduce and the firms concerned will need to adjust their employment practices, conditions and so on.

Such a work permit scheme would preserve for British industry access to the high skills that it really needs. That is not in dispute, as far as I know; it is pretty obvious that that should be the priority. There could of course be seasonal schemes—and I mean seasonal, so that they are within one year and therefore do not count as migrants—for specified agricultural or horticultural sectors. If it turns out that there needs to be an implementation period, which is now very much under discussion, new arrangements for immigration could be spread over a similar period.

I will not go into further detail. I simply reiterate that there is a clear and feasible way forward that could usefully have been explored. I conclude on a slight note of regret that the committee was so cautious in its approach to the central policy issue that we now face.

[Lord Framlingham (Con)]

Before the noble Lord sits down, perhaps he would care to comment on an interesting fact. Between 1971 and 1981, the population in this country went down—not a lot, but a little—and was stable. Look at where we are now.

[Lord Green of Deddington]

I would indeed care to comment. Our population has taken off because of immigration, which accounts in the medium and longer term for two-thirds of our population increase. I am glad that the noble Lord asked the question, because it is really important. The likelihood is that if we do not take action on EU migration, net migration from the EU will be about 125,000 a year. That is our forecast, and we are rather good at forecasting. If you do the rest of the arithmetic, adding non-EU immigration and taking away British departures, you land up with net migration of the order of a quarter of a million a year.

That is very close to the high migration scenario of the ONS, and it means that the population of the UK will increase by 10 million in the next 20 years. In other words, to put it in more understandable language, we will have to build the equivalent of the city of Birmingham every two years. That is astronomical. Its impact on infrastructure is self-evident; its impact on the scale and nature of the population is quite infinite. We have to understand this. I know that it is not popular in this House. People would much prefer that they did not have to address it, but this is what is coming down the pike, and we had better wake up and face it.