Pressure on the South East
1. Origin of this website
We see the truth of the saying "whoever you vote for, business gets in", in the area of financial services. Before New Labour came to power in 1997 it promised to end the self-regulation of the financial services industry, instead of which it set up the Financial Services Authority, which is a quango, financed and controlled by the industry. It is a continuation of the self-regulation of the previous system. The industry has an excessive influence on government policy. The government has indeed largely offloaded responsibility for deciding policy onto the industry itself. This led, via stakeholder pensions, to my website Comparative Tables - The Hidden Charges
The excessive industry influence on New Labour can be seen in other areas such as the recent Green Paper on planning, and the erosion of the greenbelt. "The Green paper is the result of a concerted business lobby.." It states: "We believe that the county no longer remains the most appropriate level at which to consider many of the key strategic planning issues." (4.37) This proposal to essentially abolish county planning authorities has been widely criticised. But the proposal to prevent repeated planning applications is welcome: "no substantially similar planning application for the same site should be accepted.." (5.42).
Such excessive industry influence is perhaps an argument in favour of a cap on political donations.
2. The expansion of the work permit scheme
The claimed skill shortages in information technology and other areas are greatly exaggerated or non-existent (like the Millennium Bug). Such claims have been refuted by Dr Norman Matloff in the United States, in his report Debunking the Myth of a Desperate Software Labor Shortage, which starts:
Due to an extensive public relations campaign orchestrated by an industry trade organization, the Information Technology Association of America (ITAA), a rash of newspaper articles have been appearing since early 1997, claiming desperate labor shortages in the information-technology field. . . . Software employers, large or small, across the nation, concede that they receive huge numbers of re'sume's but reject most of them without even an interview. One does not have to be a "techie" to see the contradiction here.
There is a similar situation in the United Kingdom. New Labour has greatly expanded the work permit scheme including "fast track" visas. They have an analogy with H-1B visas in the United States, discussed by Dr Matloff.
The Home Office has a list of "acknowledged skill shortages" for which work permits are granted. Acknowledged by who? Not by the Professional Contractors Group. They were appointed to a steering committee on work permits in November last year. Philip Ross, PCG Policy Advisor, states there is no skills shortage in IT workers in the UK.
This has been discussed on the Radio 4 Today programme and in the press (e.g. Professional Recruiter, 8th May 2002) He has succeeded in reducing the length of the IT skill shortage list, and has now reduced it to zero (press cuttings). Yet the recent Home Office White Paper states that 20 per cent of work permits are issued in "computer services" reflecting a "high growth of skill shortages" (paragraph 3.10).
In the 15th July 2002 Spending Review the Chancellor Gordon Brown said:
And to ensure British business has the skills it urgently needs today the Home Secretary will expand the work permit system for key workers from 50,000 in 1997 to an expected 175,000 next year.
He also announced the "most sustained rise in housing investment for 25 years". 200 thousand new homes have been announced. Supposing the work-permit holders stay for five years and there are 175 thousand per annum. This is then 875 thousand people, perhaps as many again dependents, and this is assuming that they return home. 200 thousand new homes is obviously inadequate. The growth in work permits being issued in shown in Figure 2 in the recent White Paper:
Number of work permits and first permissions
issued 1946-2000
This led to the following submission:
Pressure on the South East
comment on the White Paper
Secure Borders, Safe Haven: Integration with Diversity in Modern Britain
by Stephen Wynn
1. Limiting the growth in population
Many countries are trying to limit the growth in their population. The growth in the British population is not discussed in the White Paper. There may be difficulties in the future, such as North Sea oil running out, which will be easier to overcome if this country has a smaller, or at least not a larger population.
The population of the United Kingdom has increased from fifty million in 1950 to sixty million today. This increase can be entirely attributed to immigration from abroad. The White Paper states that nearly 8 per cent of the population was born abroad (1.15), and then there second and third generation immigrants. This rate of population increase is set to continue with present immigration policies, "net inward migration has become the biggest component of population change". (1.15)
2. Housing
The population increase puts pressure on the countryside and greenbelt, especially in the South East. It is a cause of housing shortages, not discussed in the White Paper. There are 4.7 million people drawing housing benefit costing £12 billion per annum. London is a city which is scarred by homelessness.
A recent Joseph Rowntree Foundation report by Lord Best says that "More than four million homes will have to be built in Britain over the next 20 years" (Observer, 10th March, page 4). A previous Rowntree report said that immigration from abroad is mainly responsible for pressure on the South East rather than, for example, the increase in the number of single-person households. The report by Lord Best is particularly concerned with the need for housing in the South East. The growth in London's population is discussed in the report of the Greater London Authority Planning for London's Growth.
I went to a meeting at a political party conference sponsored by the Federation of House Builders. They said that the need for new building in the South East was due to more single person households. This may be a factor. But surely immigration is equally or more import, since perhaps as much as half of London are first or second generation immigrants.
It is hard to believe that the proportion of single person households will increase so much by 2010. The 10% and 12% seems to refer only to younger persons whereas the 40% includes retired persons. Most single person households are retired people.
Recruitment difficulties can result from housing shortages. The police force in London receives a £6,000 per annum cost of living allowance, and teachers £3,000. Teachers had a strike and demonstration on 14th March, claiming that this £3,000 is inadequate because of house prices.
On top of working the longest hours in Europe, commuting is a nightmare for many people. Commuting times, already the worst in Europe, are getting worse. For London motorists there is the new congestion charge.
3. Work permits
The White Paper reports in paragraph 3.8 that in 2001 over 104 thousand new work permits were issued, up from 80 thousand the previous year. Extensions to existing permits increased to 33 thousand from 22 thousand. It does not discuss where these people and their dependents are living. Perhaps they are mostly living in the South East.
Paragraph 1.7 states: "This White Paper sets out new proposals for managing flows of people from entry into the UK through work-related routes or the asylum system, to settlement and the acquisition of citizenship." From which I understand that many or most work permit holders are not expected to return home. Dependents are mentioned in connection with asylum seekers, but not apparently in connection with work permits.
The government's Labour market statistics distinguish between people of working age who are unemployed and those who are economically inactive, because they are not even looking for work. In December 2001 to February 2002, there were 1.52 million unemployed, 7.89 million economically inactive, and 7.04 million working part-time. Of the economically inactive 5.59 million were not wanting a job. Of the unemployed and part-time workers respectively 935 million and 1.75 were men. How many of the economically inactive were men? There were 16.59 million men and 13.35 women who were economically active.
Paragraph 3.1 of the White Paper states there are "1.5 unemployed including just under a million who are on benefits. In addition, there are 8 million people who are not economically active". This adds to 9.5 million who are of working age but who are either unemployed or economically inactive. One in five unemployed people had a computer skills qualification, and probably many of the economically inactive.
These people tend to be older in comparison to the people given work permits. The work permit scheme enables employers to recruit younger people from abroad rather than employ older people from this country. This is age discrimination. The White Paper states that the Home Office is committed to "tackling racism, discrimination and prejudice wherever we find it" (2.3).
Should the Home Office be interesting itself to such an extent in labour market policies? The primary concern of the Home Office should surely be law enforcement. Why should it be so interested in "skill shortages", as opposed for example to housing shortages?
The Treasury estimates that public sector workers in the South East are £2,400 a year worse off than comparable employees in the private sector (Financial Times, 14th March, page 4). The government has been issuing work permits for teachers and nurses. The White Paper does not discuss whether the recruitment of people on work permits is for work in the public or in the private sector.
The work permit scheme seems to some extent, to be a method for the government to avoid paying adequate cost of living allowances for public sector employees in the South East, by importing cheap labour from abroad. It enables the government to get out of obligations such as training enough doctors. They can be recruited from abroad.
New work permits issued - as opposed to extensions to existing permits - have increased from 14,000 in 1986 (Figure 2) to over 104,000 in 2001 (3.8). Most of the increase has been in the last few years, and in long-term permits rather than short-term permits. Will the current rate of increase continue?
This is one of the "policies to promote the efficiency of the labour market" (25). The White Paper states that this increase is "reflecting increased international movement and 'brain circulation'" (3.9). International movement has not increased so much between 1986 and 2001, nor have skill shortages. The increase must result from government policy to issue more work permits.
I assume that comments are invited on everything in the White Paper, including the increase in the numbers of work permits. This does not occur in "What we have done already" in the Conclusions. Since When? This should be since the last White Paper. The Conclusion says that the Home Office has "Developed exceptional service levels for the issue of work permits". But should it be issuing so many?
Has there been proper public consultation on the expansion of the number of work permits being issued - not just consultation with employers? What is the opinion of trade unions? I have not seen this discussed or even mentioned in the press.
This expansion will not solve recruitment difficulties and skill shortages. It is contrary to public opinion. Such attempts to solve recruitment difficulties in the past have led to the unemployment problems discussed in the Cabinet Office report mentioned above.
The White Paper states that 90% of complete applications for work permits are decided within one day of receipt (12). This surely leaves no time to check that forms are filled out truthfully, such as answers to:
"Please give details and supporting evidence to what advertising you have undertaken to recruit a 'resident worker' to fill the post."
and
"For Training and Work Experience applications please explain how the person will use their training or work experience on their return abroad."
The White Paper mentions "illegal working" about twenty times, implying that employers are often not to be trusted. Yet it is trusting employers to fill out the application forms for work permits truthfully, and be telling the truth when they say they have recruitment difficulties and skill shortages.
Who are the people who are doing this illegal working? They are presumably here mainly because of either illegal entry or of overstaying. "Illegal entry" is mentioned many times in the White Paper in comparison to "overstaying(ers)", which is only mentioned twice. But I understand the problem of overstaying is more serious than that of illegal entry, in terms of the numbers of people involved. Who are the overstayers? How many work permits holders have become overstayers?
The Home Office apparently does not keep records of departures from the country. People may arrive on a visa or work permit and the Home Office does not know whether or not they have departed as required. The Home Secretary, the Rt Hon David Blunkett MP says in the Foreword: "It requires us to tackle illegal working, ending exploitation in the shadow economy ". Some employers may be taking pity on overstayers to provide them with a livelihood, rather than seeking to exploit them for cheap labour.
The work permit scheme has a category "Training and Work Experience applications". Question 21 of the application form asks: "For how long do you need the person for job/work experience/training in Great Britain?" I do not see this category mentioned in the White Paper. It is not under "Work Permit Scheme" (3.8-3.10). This section is only three paragraphs.
4. "Recruitment difficulties" and "skill shortages"
The White Paper refers about ten times to "recruitment difficulties" and another ten times to "skill shortages". It does not define what these terms mean. If an employer does not succeed in recruiting someone for a month, or if he advertises a vacancy with no replies, are these recruitment difficulties?
The July 2001 report of the Cabinet Office, Improving labour market achievements for ethnic minorities in British society, mentions "unemployment" some thirty times. This is a problem which is the direct result of policies to promote the efficiency of the labour market by immigration. The White Paper mentions unemployment only twice - with adjectives "lower" and "lowest". The report of the Cabinet Office has sections on Housing, Health and Education. Paragraph 5 of the report refers to "the growth in the working age population over the next ten years". According to paragraph 1.15 of the White Paper the population of working age is not growing, it is declining.
Looking at the Invest:UK website seeking to attract inward investment, there is no mention of either recruitment difficulties or skill shortages. On the contrary, the impression is given that the country is full of highly skilled and available labour.
Thus whether or not the working age population is growing or declining, whether there are recruitment difficulties and skill shortages or a surplus of available labour and unemployment, depends on which government publication you look at. The White Paper says that "the idea that there is only a fixed number of jobs in the economy has been discredited" (13). It follows that migration does not solve recruitment difficulties and skill shortages, because the number of jobs is not constant. The White Paper states only that "migration may help to ease recruitment difficulties and skill shortages" (3.5).
The White Paper states that "each person entering through this Scheme will create an additional 10 jobs in the UK" (10). But if there are indeed current recruitment difficulties and skill shortages as claimed by the White Paper, then surely we do not need new jobs to be created?
The existence of "recruitment difficulties" and "skill shortages" is based on the Employers Skill Survey quoted in Appendix C1. This is apparently compiled by asking employers whether they are experiencing recruitment difficulties, and have job vacancies, largely by means of telephone interviews. This is not well defined data. Employers frequently claim recruitment difficulties and skill shortages, which would not exist if they provided better pay and conditions. If there is a shortage of labour in general, why is the National Minimum Wage so low?
Not many people think that skill shortages are a problem. Whereas many people find that house prices are a problem. The Employers Skill Survey finds that 85% of employers are satisfied with the skills of their existing workforce. The sum of the "hard-to-fill vacancies" in Appendix C1 is less than 200 thousand which is less than 1% of the total work force. The definition of "hard-to-fill" is apparently not given in the White Paper. One would expect some vacancies to be hard to fill just because not everything in life is easy. The existence of vacancies does not necessarily imply that there is a skill shortage. "The mere existence of vacancies does not demonstrate a shortage."
The White Paper states that "The UK is competing for highly skilled workers with other countries keen to enrich their economies by attracting highly skilled migrants." I am not competing for highly skilled workers, nor is anyone I know. Some employers are. What's good for some employers is not necessarily good for the country. For example some companies put up dreadful looking buildings. The buildings may be good for the companies but they are not for the pedestrians who have to look at them
5. Public opinion
There is no mention in the White Paper of public opinion on immigration questions as found for example in Mori opinion polls. The BBC Radio 4 had a "straw poll" asking whether "this country needs more immigration". 80% voted against.
6. Appeals
The White Paper discusses appeals in connection with asylum claims. It does not discuss other appeals. There is a right of appeal against a refusal to extend stay. Someone can come into the country on a visa, apply to extend their stay, and if this is refused there is a right of appeal. Do any other countries have such a right of appeal?
In the 1978-79 Annual Report of the Joint Council for the Welfare of Immigrants it says it encourages people to make groundless appeals:
"APPEALS
In December, JCWI decided to limit its appeals work on the grounds that the inadequacy of the system meant that a large amount of staff time was being devoted to efforts which are often unproductive. Our revised policy is that when a case comes to JCWI at the time of refusal and before an appeal has been filed, JCWl will either:
- advise against filing an appeal and propose an alternative course of action - in which case, if the appeal is filed, JCWl will not represent the appeal;
- advise that an appeal has no possibility of success but may be filed to protect the client's status for a period, eg to complete a course of study - in which case JCWl will assist the client to complete the appeal form himself but will not represent the appeal;
- advise that an appeal should be filed and represented, and undertake to represent the appeal, subject to further assessment when the explanatory statement is received. A somewhat greater obligation to represent an appeal in a borderline case where the client desires representation is accepted in cases which were JCWI's own clients before refusal."
This particular point was contained in a paper sent to the Home Office, by the MP of a Mr Catchpole, who kindly sent me the response from the Minister David Waddington MP, dated 10th September 1986:
"The system has been in operation since 1971 and it is not considered that abuse of the system is so widespread as to warrant punitive legislation which could adversely affect genuine appellants. The Home Office Discussion Document 'Review of the Appeals under the Immigration Act 1971', mentioned in the paper enclosed by your constituent, was issued in 1981. It proposed a number of substantial changes to the appeals system, which were designed to relieve the pressure on the system and reduce the unacceptable delays in dealing with appeals which had arisen during the later part of the 1970s. The comments and suggestions received from numerous organisations and individuals were carefully considered taking account of the fact that by 1983 the delays in the appeals system had been reduced by administrative means. It was decided not to extend further appeal rights in certain areas. I can assure you and Mr and Mrs Catchpole that the Government continues to monitor the effectiveness of the appeals system."
7. War crimes
The White Paper mentions the War Crimes Act 1991 (7.18). This has resulted in only one prosecution. There have been alleged war criminals in the country ever since the Second World War. Leaving the Act until 1991, is very late in the day. This country has sadly been a haven for a considerable number of war criminals. The War Crimes Commission of the United Nations should not have been disbanded in 1948.
8. Conclusion
The White Paper uses the word "managed" at least twenty times. Migration into this country often seems out of control, rather than managed. An example is the opening of the Channel tunnel without adequate immigration procedures in place. Many people were buying a ticket from Paris to Calais, staying on the train, arriving in this country and then claiming asylum. Another example is the right of appeal against a refusal to extend stay mentioned above. People are appealing as a means of extending their stay in the country until their appeal hearing, for which they often do not even turn up.
The right to stay in Britain should be treated as something precious. Not something to be given to anyone who employers wish to recruit from abroad, so that they can avoid paying adequate wages or provide training for British people. Successive governments have not attached sufficient importance to British citizenship. As the White Paper states: "It is not altogether surprising that many applicants do not appear to attach great importance to acquiring British citizenship, beyond the convenience of obtaining a British passport." (2.12) We may be just "a stepping stone to other countries" (1.14). I like the idea of a citizenship ceremony (2.19).
The main point of this submission, is that in my opinion there should not be the current expansion in the number of work permits being issued. The main reason for my concern is house prices and pressure on the South East for more housing and other kinds of building. The White Paper mentions "recruitment difficulties" and "skill shortgages" many times, but makes no mention of "housing difficulties" or "housing shortages".
18th March 2002
Housing
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The Fate of the Countryside: Death by Planning?
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Demand for new homes are threat to green belt
Work permits
Are IT skills shortage schemes being abused?
PCG gives further evidence to Home Office of FTV abuse
Debunking the Myth of a Desperate Software Labor Shortage
Visa extension only the beginning for UK-India IT relations skill shortages
Immigration and Nationality Directorate.
New Policy Team
Apollo House,
36 Wellesley Road,
Croydon, CR9 3RR.
www.ind.homeoffice.gov.uk
01 May 2002
Dear Mr Wynn,
Thank you for your letter of 18 March 2002 with regard to the White Paper 'Secure Borders, Safe Haven: Integration with Diversity in Modern Britain'.
In the last financial year (April 2001 - March 2002) Work Permits (UK) considered 132,770 work permit applications. Of those applications, 123,337 were approved. New work permit approvals were 89,163. It is difficult to determine whether the number of work permit applications will increase as this depends on a number of factors including; possible global recession and skill shortages in the UK.
Exceptional turnaround times are achieved by having in place a well trained workforce, tried and tested systems, which is underpinned by having a customised IT system which allows employers to e-mail their applications electronically, thus improving the clearance rates. All of this is underpinned by rigorous quality control checks. All applications are pre-sifted (pre-issue check) by a manager who gives a steer on how to proceed with the application. The quality of decision making is also measured by Work Permits (UK) approval rate which is consistent (92% of all applications received are approved with a 1-2% variance) this has been the same for a number of years.
All stakeholders are involved through a number of Sector and User panels that are regularly held. This includes consulting relevant Trade Unions, which often happens when we are seeking confirmation that there is a skill shortage of skilled personnel in a particular field. It is in our interests to consult with as many interested parties as possible as this all feeds into shaping our policy.
For further information with regard to work permits, please contact Work Permits (UK) directly at the following address:
Work Permits (UK)
Sheffield
I would like to assure you that your comments will be given serious consideration and made available to Home Office Ministers.
Yours sincerely,
White Paper Comments
New Policy Team
Immigration and Nationality
Directorate.