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US net migration caps won’t work

LONDON, ENGLAND - AUGUST 29: Conservative Party leadership candidate Tom Tugendhat speaks during a press conference on August 29, 2024 in London, England. Mr. Tugendhat addressed Keir Starmer's Tuesday speech, in which the Prime Minister warned the nation about October's budget. (Photo by Carl Court/Getty Images)

August 30, 2024 - 4:10pm

For anyone interested in policy, this has so far been a very frustrating Conservative leadership contest. Half the candidates are making a point, even taking pride, in saying nothing at all about how they’d govern; when the other half do make suggestions, they’re often not very good.

Immigration is a case in point. In a speech on Thursday, Tom Tugendhat announced that if he became prime minister he would introduce a binding annual cap for net immigration of 100,000 people a year. This follows Robert Jenrick’s promise of a lower cap — and an annual debate in Parliament to set it.

On one level, this sort of thing is understandable: immigration was perhaps the single biggest policy failure of the last period of Tory government. In particular, Boris Johnson’s decision to use his post-Brexit freedoms to massively liberalize the system was an own goal of historic proportions.

A hard cap also has the advantages of being simple, both to communicate and to legislate for. But such a policy is extremely unlikely to deliver the promised results, as it does nothing to directly tackle the various ways in which parts of the British economy are dependent on imported labor. As a result, the likely consequence of introducing a hard cap with no warning would be that every vested interest would start screaming at the same time.

That would be a very difficult thing for any government to face down, and both universities and employers know it. As a result, they would be more likely to play chicken with ministers than take the Conservatives at their word and begin voluntarily preparing for a difficult adjustment.

Alternatively, the headline cap could remain in place but become an administrative fiction. Consider the way that Conservative ministers would boast about historically low unemployment rates, without accounting for the fact that we now have lots of categories of person (collectively known as the ‘economically inactive’) which are no longer counted in the unemployment figures.

It isn’t difficult to imagine the Treasury, Business Department, and Department for Education quietly but effectively lobbying for various types of immigration to be excluded from the headline total. Hard enforcement limits do have a role to play in bringing down immigration, but they’re the stick in a carrot-and-stick approach. For example, ministers could insist that any sector lobbying for a profession to be added to the Shortage Occupation List — a shortcut to visas for those with much-needed skills, such as florists — must first agree with the Government a clear plan for creating a domestic training and recruitment pipeline.

Any shortage declaration could be time-limited and tapered, such as an initial annual allowance to be cut by 20% every year and then expire completely in five years. This would give employers access to personnel they need to bridge a skills gap, but set a clear deadline by which they would need to wean themselves off imported labor.

This would help tackle the very obvious perverse incentives created by the existing Shortage Occupation List, which has seen the number of employers pleading a domestic skills shortage more than triple from 3% in 2011 to 10% in 2022.

Actually reducing immigration sustainably requires thinking hard about the deep structural problems within the British economy. Using brute force to try and navigate our way out of them with simplistic, headline-grabbing solutions is a recipe for failure. Even if the public is ever persuaded to give the Conservatives a second chance on immigration, it will surely not give them a third.


Henry Hill is Deputy Editor of ConservativeHome.

HCH_Hill

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