Migration Advisory Committee (MAC) urges Government to avoid ‘past mistakes’

On 27 January the MAC published their latest report– ‘A Points-Based System and Salary Thresholds for Immigration’.

The MAC is an advisory, independent, non-departmental public body that advises the government on migration issue. It was commissioned in June 2019 by the then Home Secretary, Sajid Javid, to report on salary thresholds as part of the future immigration system. Furthermore, in September 2019, the current Home Secretary, Priti Patel, commissioned the MAC to report on how an Australian-style points-based (PBS) immigration system could be introduced in the UK post-Brexit.

Both commissions are intended to provide input to the Government in formulating the UK’s future immigration system for life after Brexit. Whilst the Government are not bound to accept the committee’s recommendations, it is however likely to have some considerable weight in the Government’s immigration policy given the level of research and evidence collated. Going by track record, previous Governments have largely adopted the recommendations of the MAC.

Whist Boris Johnson and Priti Patel have been promoting the idea of a new Australian-style points based system, the MAC has warned the Government to avoid ‘past mistakes’ and to ‘draw on best practice from other countries which would include a cap and the use of the Expression of Interest system’.

Skilled worker route for individuals with a job offer – current Tier 2 framework

The committee recommends that the existing framework for Tier 2 (General) be retained because “the combination of skill eligibility and a salary threshold works well for an employer-driven system”. It’s envisaged that the future system of Tier 2 will apply to both EEA and non-EEA nationals, be expanded to include medium skilled jobs and the abolition of the RLMT process. The committee also recommended lowering the minimum salary to around £25,600 for experienced workers. They concluded that considering the expansion of eligible jobs to include medium-skill occupations, the minimum salary level should be reduced to accommodate for certain sectors such as NHS, education etc. Sponsors would however still need to pay the amount specified in the relevant SOC code if that was higher.

The new entrant rate was recommended to be £17,920 (30% reduction of the experienced rate). Furthermore, the committee recommended the definition of new entrant be ‘less restrictive’ and that individuals should benefit from the new entrant rate for 5 years instead of the current 3 years.

The committee made no recommendation on pro-rating salaries, however, the MAC did recommend that “there should be more options for existing visa holders who swap to part-time work when they become parents”.

The committee rejected the idea of adopting lower salary thresholds for sponsored workers outside of London and instead recommended a single salary threshold across the UK. A further recommendation was made to conduct a separate pilot in the future for ‘remote areas of the UK.

Skilled worker route for individuals without a job offer – proposed Points-Based System

The committee reports that “if the Government wants to have a PBS route on entry, it could make sense to re-orient Tier 1 (Exceptional Talent) with the aim of increasing the numbers though the challenge is to do this without significantly affecting quality.” The committee’s view is that if the Government does wish to introduce an Australian-style points based system then the Tier 1 (Exceptional Talent) route should be modified in order to attract overseas talent post-Brexit.

The report finds that the Tier 1 (Exceptional Talent) route “does not work well” and is “failing to meet all its objectives”. The committee found that last year only 600 applicants were admitted under Tier 1 (Exceptional Talent) – this clearly indicates that the category is not reaching its full potential given that there is an annual cap of 2000.  The MAC’s proposed modifications for this route are:

• Introducing an overall annual cap on those admitted;
• Operating a monthly draw system from a pool of individuals who have  ‘expressed an interest’ in coming to the UK;
• Successful candidates will be invited to submit a full application;
• Selection should be based on those who have the highest number of points in the pool using a points-based system with tradeable points;
• There should be a minimum number of points;
• Points should be given for characteristics that the Government wants to attract through this route and for whom other routes are not suitable;
• Among the characteristics that the Government might want to consider in assigning points are:
  – qualifications with a rigorous process to assess the quality of qualifications and not just the level;
  – age;
  – extra points for having studied in the UK;
  – priority areas such as STEM and creative skills.

Settlement

The committee found that the UK’s system for settlement to be inflexible and called for an immediate pause in the proposed increase in the settlement salary threshold. This would allow “to establish a clearer picture of how it is currently working and possible changes that could be made.” The committee also made it clear that it was difficult to assess the impact of the settlement system in light of the very little data available. In fact, the committee made reference in their report to the difficulty they had in accessing data. Recommendations were made in the report on the need for the government to improve data availability and access and for this to be reviewed from time-to-time.

We now await the Government’s proposed White Paper on the Future Immigration system which is planned to come in to effect as early as January 2021. It will be interesting to see if the Government decides to stick to their rhetoric of introducing an Australian-style points based system or instead opt for a more flexible, mix-match system as indicated by the report.

Access to the MAC’s full report can be found here. However, for ease we have provided all recommendations below:

All recommendations

1. We recommend retaining the existing framework for Tier 2 (General).
2. If government wants to have a PBS route on entry, it should consider modifying Tier 1 (Exceptional Talent) in the following way:

• There should be an overall annual cap on those admitted;
• The route should operate on an expression of interest basis creating a pool of migrants interested in coming to the UK;
• There should be a monthly draw from this pool with those selected invited to submit a full application;
• The selection of those invited to apply should be based on those who have the highest number of points in the pool using a points-based system with tradeable points;
• There should also be an absolute minimum number of points;
• Points should be given for characteristics that the Government wants to attract through this route and for whom other routes are not suitable;
• Among the characteristics that the Government might want to consider in assigning points are: Qualifications with a rigorous process to assess the quality of qualifications and not just the level; Age; Extra points for having studied in the UK; Priority areas such as STEM and creative skills.
• Changes should only be made if data is collected on the outcomes of migrants on this route, with monitoring and evaluation of the route.

3. There should be an immediate pause in the proposed increases to the settlement threshold.
4. We recommend a review of the requirements for settlement, to establish a clearer picture of how it is currently working and possible changes that could be made.
5. Both the occupation specific and general salary thresholds should be based on the relevant distribution of full-time earnings as reported in the Annual Survey of Hours and Earnings (ASHE) and updated annually. The appropriate salary threshold should continue to be the higher of the occupation specific and general threshold.
6. The occupation specific threshold should be the 25th percentile of the full-time annual earnings distribution for that occupation.
7. The general threshold should be set at the 25th percentile of the full-time annual earnings distribution for all Tier 2 (General) eligible occupations.
8. National pay scales should be used as the relevant salary thresholds in 24 occupations in health and education instead of both the occupation specific and general thresholds.
9. If the Government is concerned about the impact of the general threshold on lower-wage medium-skill occupations, we recommend the use of an occupational cap to be set at the 75th percentile. We do not recommend this given the level of the general threshold we propose.
10. There should be more adequate monitoring of how migrants are faring in the UK labour market after entry and ongoing review of the impacts of the recommendations on levels of salary thresholds.
11. The relevant salary thresholds should apply across the UK.
12. There should be a separate pilot visa for ‘remote’ areas of the UK, part of which could be lower salary thresholds for migrants into those areas. This should only be done with a full evaluation to understand its effectiveness and impacts.
13. Salary thresholds should not be pro-rated to allow for part-time work.
14. The Government should consider more flexibility (i.e. prorating salary thresholds) for visa holders switching to part-time work after becoming a parent.
15. Only salary on the main job should be used to determine whether the salary threshold is met. Allowances, equity and employer pension contributions should not be included.
16. The rules on Tier 2 (General) visa holders owning equity in the employer sponsoring them should be reviewed.
17. Occupations on the Shortage Occupation List should not have lower salary thresholds for entry.
18. We recommend a review of whether the SOL is needed after the new immigration system has been fully introduced.
19. National pay scales should be used as the relevant salary thresholds in 24 occupations in health and education instead of both the occupation specific and general thresholds.
20. The salary thresholds for new entrants should be a single ‘reduction’ percentage applied across both the general experienced worker threshold and the occupation specific experienced worker thresholds.
21. The reduction percentage for new entrants should be set at 30 per cent.
22. The definition of a new entrant should be widened to include those are working towards recognised professional qualifications and those who are moving directly into postdoctoral positions.
23. The new entrant rate should apply for five years, an extension from the current three-year entitlement. Any time spent on the new post-study work route should count towards the five years of new entrant threshold eligibility.
24. We recommend adding/removing the following occupations from the list of RQF3+ occupations

• Add: Air-conditioning and refrigeration engineers, rail and rolling stock builders and repairers, skilled metal, electrical and electronic trades supervisors, carpenters and joiners, glaziers, window fabricators and fitters, plasterers, floorers and wall tilers, painters and decorators, construction and building trades supervisors, childminders and related occupations, teaching assistants and educational support assistants.
• Remove: Fishing and other elementary agriculture occupations n.e.c. and waiters and waitresses.

25. The Government and ONS should seek to link data sets across government to allow a better understanding of the employment outcomes of migrants, for the purposes of research whilst ensuring confidentiality.
26. The Government should invest in a data set designed to link migrants with subsequent outcomes to be used for the evaluation of all visas.
27. The Home Office should ensure it retains historical data on migration routes in a usable format for future analysis.
28. The Home Office should publish breakdowns of entry clearance visas disaggregated by gender on a regular basis.