18 May 2017

What does the manifesto say about immigration?

The key manifesto pledges on migration are to:

reduce immigration to sustainable levels, by which we mean annual net migration in the tens of thousands… continue to bear down on immigration from outside the European Union… [and] establish an immigration policy that allows us to reduce and control the number of people who come to Britain from the European Union.

This can be read in connection with another significant pledge that “overseas students will remain in the immigration statistics,” underpinned by tougher initial requirements for issuing student visas and for staying on to work after the completion of a course. Family visa sponsorship will also be subject to an increased earnings threshold.

In relation to industrial strategy, a Conservative government would seek recommendations from the independent Migration Advisory Committee on reforming the visa system, and foresees setting aside:

significant numbers of visas for workers in strategically-important sectors, such as digital technology, without adding to net migration as a whole.

Finally, the manifesto promises to:

double the Immigration Skills Charge levied on companies employing migrant workers, to £2,000 a year by the end of the parliament, using the revenue generated to invest in higher level skills training for workers in the UK.

What does the manifesto tell us about the Conservative approach to EU negotiations and the world beyond Brexit?

The polls have been wrong before, but… – The trend in opinion polling since the general election was confirmed last month gives little indication that the Conservatives’ commanding lead is being eroded. This could obviously be proved wrong on polling day, but it looks likely that both Conservative policy and personnel will be what confronts EU negotiators the day after the general election. The optics of Theresa May picking David Davis to introduce her to the stage are also pointedly clear. This will be read as a show of support for a key lieutenant and a riposte to continental media speculation about the security of Davis’ position that emerged following Jean-Claude Juncker’s Downing Street dinner last month. For the record, Davis appears, ultimately, to have taken this as a compliment, but there should be no doubt that the manifesto content and its presentation were intended to demonstrate Theresa May’s intent clearly to both domestic and European audiences.

A hybrid migration system is the new normal – Building on Labour’s manifesto pledges on visas and work permits, the Conservative promise to take the advice of the Migration Advisory Committee on setting visa numbers in key skills areas points towards a future where a hybrid system of migration management becomes the norm, blending demand from employers with supply criteria set by government. Open Europe has previously made recommendations on how such a system could work, as well as highlighting the need to balance a desire to control migration with business’ need for flexible sources of labour and a consideration of the UK’s long-term fiscal sustainability given its ageing demographic profile.

Room for manoeuvre on freedom of movement? – While Labour’s manifesto explicitly stated that freedom of movement would end when the UK leaves the European Union, the position set out by the Conservatives in their manifesto is subtly different. Domestically, the pledge to reduce overall migration to the tens-of-thousands is pitched squarely at the majority leave vote, whose support in areas like Halifax where the manifesto launch took place could be enough to turn swathes of Conservative target seats blue on June 8th. In the context of the Brexit negotiations that will begin the following day on June 9th, the separate references to EU and non-EU migration give Theresa May the option of offering some form of preferential access to the UK labour market for citizens of the EU-27 countries, presumably as an incentive for the EU to grant other UK demands. This would of course be a matter for negotiation, but the nuance in the Conservatives’ position as set out would allow them to strike a tough tone on migration while giving the EU a face-saving pretext for granting, say, preferential market access for UK financial services firms while still preserving the integrity of the Single Market.

Commitment to an orderly Brexit – Less novelty but equal value is to be found in the manifesto’s reiteration of a number of previously announced points that provide clarity on the conditions that will apply as the UK transitions to its new status outside the EU. These include the aim of achieving “as frictionless a border as possible” between the Republic of Ireland and Northern Ireland, support for Gibraltar’s position, “fair settlement” of financial commitments with the EU, and lodging UK schedules in alignment with current EU commitments under the World Trade Organisation regime. There is also a commitment to “remain signatories to the European Convention on Human Rights for the duration of the next parliament.” We also welcome the commitment to taking full control of trade policy by leaving the EU Customs Union, an approach we recommended as essential for realising the full opportunities of Brexit in our recent report ‘Nothing to Declare’.

“We do not believe in untrammelled free markets” – More broadly, the manifesto pledges on migration seem to form part of a wider reorientation of Conservative thinking under Theresa May, where government appears set to take on a more active role in relation to the functioning of industry and the labour market. This is a double-edged sword. On the one hand, pledges to beef up UK Export Finance to support for British firms, and prioritising regional and sectoral investment once regular EU budget contributions are no longer required are to be welcomed. On the other, plans to place additional costs on firms who use immigrant labour and to restrict availability of overseas student visas in what is a highly lucrative export sector for the UK must be developed sensitively to ensure the post-Brexit immigration, trade and investment regime makes sense for the needs of the whole UK.

Britain must be truly Global after Brexit – Theresa May has made plain, both in government and in this manifesto, that the Conservatives will seek a global leadership role for the UK after Brexit. Nevertheless, her affirmation in presenting her manifesto that “Brexit will define us” identifies how central the arrangements negotiated with the EU will be for defining Britain’s position in the wider world. In this context, it is encouraging therefore that the imperative to control migration has not come at the expense of initiatives like the GREAT Britain and Visit Britain campaigns, which support the UK’s soft power presence and aim to attract people to the UK for study, work and pleasure. The manifesto commitment to these programmes is in line with the recommendations set out in Open Europe’s recent ‘Global Britain’ report, in which openness and engagement in trade, security, research and development cooperation will be critical for maximising potential opportunities and offsetting risk as the UK leaves the EU.