U.K. Sees Post-Brexit Immigration System Tied to Trade Deals

(Bloomberg) -- The U.K. government envisages a post-Brexit immigration system that treats all nations equally, but gives ministers the flexibility to tailor rules for countries striking trade deals.

High-skilled workers will be prioritized and low-skilled immigration curbed under new rules announced by Prime Minister Theresa May Tuesday, a day before her leader’s speech at the Conservative Party annual conference. May spent the morning touring broadcast studios to detail her plan, which she said delivers on the 2016 Brexit referendum and voters’ concern about immigration.

“It is going to bring free movement to an end for once and for all, meaning we’re in control of our borders; we will be deciding who comes here,” May told BBC radio. “That decision will be based not on where somebody comes from, but on the contribution they will make to our economy, and so it will be a skills-based system.”

The proposals largely mirror recommendations made in a report last month by the Migration Advisory Committee that was commissioned by the government. The new system is likely to go down well with Brexit voters who argue that cheap labor from the European Union has undermined wages and put pressure on public services, but could hinder negotiations over Britain’s departure from the bloc in March.

Business Worries

Businesses which rely on those workers, including in the construction and hospitality industries, will also need reassurances they can still fill vacancies at a time when unemployment is at historic lows. Ministers have already announced a program for seasonal agricultural workers to allay fears that produce may be left rotting in fields.

“There are some very serious concerns for business arising out of the immigration proposals,” British Chambers of Commerce Director General Adam Marshall said in an interview in Birmingham. “The prime minister has fallen into this trap which is the U.K. needs the brightest and the best. No. it needs the people that the labor market can’t provide in order to keep the economy going. Some of those are care workers, people in the hospitality and leisure industry, people in agriculture etc.”

The premier, for her part, said that “for too long,” ordinary Britons have felt their views on immigration have been ignored by politicians. “The new skills-based system will make sure low-skilled immigration is brought down and set the U.K. on the path to reduce immigration to sustainable levels, as we promised,” she said. “At the same time, we are training up British people for the skilled jobs of the future.”

May has stuck resolutely to a long-held target of cutting net annual immigration to the tens of thousands -- from more than 200,000 currently. The Tories haven’t come close to meeting it since coming to power in 2010. On Tuesday, May told ITV News she was still committed to bringing net annual migration down to "sustainable levels,” in the tens of thousands.

‘Abusing the System’

"It will take time to get to where we want to and, as I’ve always said in the past in terms of dealing with immigration, you constantly have to be looking to make sure you’ve got the rules right and people aren’t abusing the system,” May said. "Having the ability to bring control in relation to those people coming from the European Union will help."

Immigration Minister Caroline Nokes told Bloomberg TV that proposals will be put forward this fall, with a draft law following “within the next few months.”

Nokes suggested countries that strike trade deals with the U.K. -- including the EU -- could aspire to more privileged access for workers.

“It’s really important that we don’t rule anything out at this point in the negotiations,” she said. Asked if Britain might make a better immigration offer to the 27 remaining EU nations than to the rest of the world, she said: “Or it could be the case that there is something better for other parts of the world, and I think that’s the flexibility that we’re certainly going to need.”

©2018 Bloomberg L.P.