The debate over free movement rages on since its starring role in the Brexit campaign. With the status of current EU migrants and future talent unclear, a new level of business uncertainty is engulfing UK employers. From tech and creative startups through to the NHS, organisations up and down the country are unsure about what their future workforce will look like.
The Leave campaign’s promise of an Australian points-based system was somewhat ironic given that the UK has had a points-based system since 2008 for migrants from outside the EU. The most “Australian” element of it was Tier 1 General visa, where migrants with the right combination of qualifications, work experience and earning potential could come to the UK. This programme was one of the first to be closed down by the government to try to achieve the ultimately untenable “tens of thousands” net migration target. This was followed swiftly by other measures that restricted access to talent.
What is now left of the points-based system is simply inadequate for swathes for small businesses, especially in new technologies and creative industries, and unpopular with universities.
The current setup favours corporatist structures with traditional employment patterns – you work for a big company (your sponsor), the HR department knows the bureaucracy and deals with it for you, and your salary reflects your level of skills. However, modern talent does not work like that; it takes risks and its financial rewards come in shares, gigs or IPOs. Employment patterns in many industries have shifted, and arguably the greatest benefit of freedom of movement was the speed and scale at which the labour market could respond to demand.
With Boris Johnson as mayor of London, I lobbied alongside London’s small and big businesses and universities for a system that better met those needs. The Commonwealth visa, the London visa, third party sponsorship – all of these policies I suspect will now be considered. What the government should take from all these proposals is their common focus on greater access to talent – they didn’t shy away from trying to design a system to meet the new reality of twenty-first century employment.
But these policies were only plasters on a system inflexibly locked between an immigration target and free movement. Now a genuine opportunity exists to create a points-based system that works. There are four things the new architects should prioritise to avoid crippling parts of the economy that need less bureaucracy now more than ever.
First, the net migration target must be dropped. The target was flawed in so many ways already dissected, not least due to the poor quality of statistics. Levels of skilled work migration should be flexible to work with demand and not political targets.
Second, UK Visas and Immigration (UKVI) must have a massive resource boost, both financial and technological. Small business owners hear the commitment to maintain high skilled migration, but without free movement, the talent must go through the bottleneck of the system at a potentially growth crippling speed. UKVI must quickly and dramatically increase its capacity to process applicants, whatever the new system is. This must be done in a way that shuts down abuse effectively in order to maintain confidence in the system.
Third, international students studying at degree level and above (including professional and artistic qualifications) must have the right to stay on after their studies for at least two years and have the right to work in the UK. If the UK wants to be an open trading nation, the soft skills and global talent pool graduating from our world class universities contains exactly the people we want in our labour market. This is something long championed by prominent Leave business leader James Dyson. British universities will need a much better offer to EU students who will face new higher fees and bureaucratic hurdles.
Finally, the replacement of free movement must plug the gaps that currently block out workers that don’t fit 1970s corporatist structures, such as founders and workers in tech and creative startups. And it should cover global talent, as both the UK’s trading partnerships and the specialist skills the country requires increasingly come from beyond the EU.
Despite the shock Brexit vote, entrepreneurs are dusting themselves off and getting back to business. Politicians and policy-makers must now do the same. The hurdles over the coming weeks, months and years are significant, but there are opportunities too. If the visa system is to be overhauled, let’s make sure the new system is better than the one it replaces.