Government to respond to Migration Advisory Committee report

13 February 2020

After the Cabinet meeting tomorrow, the government may well respond to last month’s Migration Advisory Committee (MAC) report on the future of the post-Brexit UK immigration system.  The changes will take effect from 1 January 2021 and will be enormously significant for employers of EU citizens.


On the eve of the government announcing its proposed changes, it will be interesting to see how they compare with what the MAC actually said in its report – as set out further below. 

Likely key government proposals 

Thanks to a leak of the proposals in the Sunday Times last weekend, we already have an inkling of what the new rules for skilled workers will include.  Whilst it may not be referred to as “Tier 2”, the indications are that the system for skilled workers will use much the same framework – albeit it is likely to be touted as an “Australian style” points based system.  Key proposals are likely to include that:

  • The job must be at an appropriately skilled level (RQF level 3 – see further in the analysis of the MAC report below)
  • The job must have been offered by an approved sponsor
  • The salary must be at least £25,600 (see further in the analysis of the MAC report below)
  • The applicant must be able to speak a good level of English

All such requirements are very recognisable in the current Tier 2 (General) category.  However, points for salary could be ‘tradable’ – if the salary is below the required threshold, an applicant could still apply if they are working in a sector where there’s a skills shortage.  An “outstanding” education or a PhD in a relevant subject to the job could also score extra points.  Far from simplifying the system, such changes are likely to make employers more uncertain of whether their application will succeed and potentially delay processing times, just when there is likely to be a huge surge in the number of applications.

The Sunday Times article also refers to that from next year there will be 5 ways of coming to the UK i.e. highly skilled/exceptional candidates, skilled workers, unskilled workers, students and a miscellaneous category.  Essentially, this would be an exact replica of the current 5 tiered Points Based System the UK has had since 2008.

 

Background to the MAC report

The MAC is, according to the government, “an independent, non-statutory, non-time limited, non-departmental public body that advises the government on migration issues.”  The MAC was established in 2007 to provide the government with transparent, independent and evidence-based advice with the expectation that this advice will be useful to the government in the design of immigration policy. 

Following the government’s commission in June 2019 (see our blog here) the MAC’s report focused on options for a Points Based System (PBS) in the UK.  An ‘Australian style’ Points Based System was proposed by the current Prime Minister in the December 2019 general election.  The report also focused on salary thresholds for sponsored skilled worker thresholds. This is likely to be the last report under the current chair, Professor Alan Manning, whose term (which has not been extended by the government) is coming to an end in March.

The report was particularly important because of its timing, the first such report following the now certain departure of the UK from the EU. One of the consequences of Brexit is, unless otherwise negotiated, free movement of workers will end as early as 1 January 2021, depending on if the transition period is extended. Thus British businesses will no longer be able to enjoy free access to the EU labour market to fill vacancies and with unemployment in the UK running at 3.8% of the labour force, shortages are already upon them. Resolving this problem was the focus of the report.

 

An ‘Australian style’ Points Based System for the UK? 

Far from endorsing the idea of an ‘Australian style’ PBS, the report equally considered the benefits of the New Zealand, Canadian and Austrian PBS.  The report stated “Defining a PBS is not as simple as it might seem. Using the broadest definition any selective migration system can be thought of as a PBS, because it could be presented as a system with points, though we would question the value of doing so purely as a cosmetic exercise.”  Instead, the MAC focused on the fact the UK already has a 5 tiered PBS which was phased in between 2008 and 2010. Only Tier 1 (General) was a truly open PBS where applicants could achieve the required number of points from their qualifications, previous earnings, age and UK experience.  The category was deleted though, partly due to concerns that successful applicants were working in jobs classed as lower skilled. 

 

Tier 2 (General) - with a job offer

The MAC recommended that the Tier 2 (General) category should be retained and a job offer should still be a requirement but this should not be combined with a tradable points requirement. As set out in its previous EEA migration report, the MAC suggests that:

  • the same system should apply to both EEA and non-EEA applicants
  • the skills threshold for Tier 2 be reduced to include ‘medium skilled’ occupations
  •  the resident labour market test (RLMT) be abandoned
  • there should be no numerical cap on the number of Tier 2 (General) applications

Bearing in mind those changes recommended in the EEA migration report, in the latest report the MAC also recommended the following in terms of salary thresholds:

  • that the current system of minimum thresholds for the Tier 2 (General) category and the specific type of job should be retained – with the higher of the two thresholds being applicable
  • the threshold at which the specific job minimum salary requirements is set should remain the same
  • the current Tier 2 (General) category minimum salary requirement of £30,000 should be lowered to around £25,600.  This takes into account the proposed inclusion of medium skilled roles in Tier 2 and also that the MAC recommended many new roles be added to the list of those roles considered to be medium skilled including for example plasterers, carpenters, tillers, painters and decorators.  There has been previous discussion of the minimum salary rate being £20,000 but the MAC considers that too low
  • on new entrant salary thresholds, the MAC says this category should be retained at a lower rate in order that younger applicants and those switching from study can qualify.  It says the definition should be broadened to include those working towards professional qualifications or post-doctoral positions (this is presumably for educational and research institutions). The rate should be valid for five years (up from the current three years)
  • there should not be regional variation of salary thresholds
  • there should not be a lower salary threshold for shortage occupation roles and the existence of such roles is called into question given the proposal for RLMTs to be abandoned
  • any increase in the minimum salary requirement for indefinite leave to remain applications for those holding a Tier 2 (General) visa should be “paused” at the current rate of £35,800 until a further review is carried out

For those employers who use the intra-company transfer route, Tier 2 (ICT), to move employees from related entities in other countries into the UK, these changes if adopted will raise questions about whether that route will continue in the same way. 

 

Tier  1 (Exceptional Talent) / Global Talent routes – without a job offer

The MAC considered the Tier 1 (Exceptional Talent) route to be too complex and restrictive to attract the kind of people the scheme was designed for. It recommended that if the government actually wants a PBS, it should revise this Tier focusing on people with ‘exceptional promise’ rather than ‘exceptional talent’. The suggestions get a little baroque at this point with the recommendation that the UK should have an Expression of Interest system for applicants to enter if they fulfil a minimum threshold of points. It suggested the points should be given for qualifications, age, UK studies and extra points for science, technology, engineering and mathematics skills as well as creative skills.  In that way the threshold for a Tier 1 (Exceptional Talent) application would be significantly lowered and start to look like the previously deleted Tier 1 (General) category.

The MAC says there should be a cap on numbers and where the Expressions of Interest exceed the cap there be a prioritisation mechanism based on the points of each applicant.  Such a system could be off-putting to some applicants who would not have a guarantee of success in the pool.  Further, the MAC’s recommendation of a cap contradicts with the government’s plans for this category.  Following announcements last year, see our blog here, from 20 February 2020 the Tier 1 (Exceptional Talent) category will be replaced by the Global Talent category.  Those rule changes see an end to the cap on numbers (which was not being met) – in contrast to the recommendations of the MAC, albeit based on a lower requirements threshold.

The key new feature of the Global Talent scheme will be an extra endorsing body in the form of the UK Research and Innovation which will allow scientists and researchers to enter the UK.  Where the applicant will work at a recognised UK research organisation, their application can be fast-tracked with less onerous evidential requirements.

 

Conclusions

The MAC’s recommendations are certainly nothing like the Australian PBS which the Prime Minister vowed he would introduce and may confirm shortly. Most economic migration, in accordance with these recommendations would continue to be on the basis of a job offer already made.

Of course economic migration is only a small part of the UK’s migration picture. According to the Office for National Statistics, in the year ending March 2019, 181,093 overseas nationals were admitted to the UK for work; 243,937 were admitted as students (mainly university level); 162,254 as family members of people already here (British and foreign) and 17,304 refugees and persons in need of international protection were allowed to stay. So the MAC’s proposals, even if embraced wholeheartedly by the government, would only tinker with the rules relating to less than a quarter of new entrants (one could exclude students from these statistics which would mean that they account for about half).

A subject not mentioned in the MAC report but central to decisions by businesses and individuals about whether to move to the UK is the level of fees which must be paid up front to make an application. These have been drifting upwards rapidly over the past five years.  For Tier 2 (General) applications, employers are required to pay £1,000 per year of the visa for the Immigration Skills Charge and the Immigration Health Surcharge which is currently £400 per year of the visa but the government plans to increase that to £625. In light of these charges which employers have to pay up front, the chance that reducing the skills requirement will result in employers being able to fill their vacancies in a cost effective manner is questionable. 

We eagerly await the government’s formal response to the MAC report, and will keep you updated.  If you have any queries, please contact a member of the immigration team.  

About the authors

Elspeth Guild is a partner in the immigration team best known for her expertise in the field of European Union free movement of persons, immigration and borders law and practice. She is widely recognised as an expert in her field.  Elspeth is also a law professor at Queen Mary University of London and regularly teaches lawyers and judges in the EU on issues of EU borders and migration law and acts as an expert for international organisations such as the Council of Europe, UNHCR, and the European Commission and Parliament. 

Tim Richards is a professional support lawyer in the immigration team. He is a solicitor with extensive experience in corporate and private client immigration matters and is responsible for the knowledge management and ‘know-how’ development for the immigration team

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