Migration Advisory Committee publishes review of salary requirements and annual report

The Migration Advisory Committee is clearing its desk ahead of the holiday break, publishing not one but two reports today. The first is the review of the salary requirements for work visas, where the committee has recommended keeping the general threshold at £41,700 and that a single new entrant rate is set at £33,400. The second report published is their annual report which looks in particular at the family and overseas domestic worker routes, as well as the English language requirement.

Review of salary requirement for work visas

For skilled workers, the committee reiterated their previous recommendation that the occupation specific thresholds for the skilled worker route be set at the 25^th percentile of occupational earnings to reduce the risk of undercutting domestic workers. The recommendation for the general threshold is that this is set at £41,700 to maximise the fiscal benefits. Salary thresholds should be reviewed and updated on an annual basis. The committee continues to recommend a UK wide, rather than regional approach.

The new entrant discount should be set at £33,400 which would enable typical graduates to be employed while also being enough for them to provide a net fiscal benefit. The committee also recommended a change from the current four year period for the discount, declining to make a specific recommendation on length but noting that:

If the occupation-specific threshold is set at the 25^th percentile and the general threshold is £41,700

• for the SW route, the valid discount period for new entrants would be six years.
• If the 25^th percentile is maintained but the general threshold is increased to £48,400, the discount period would extend to nine years.
• If the occupation-specific threshold is set at the median and the general threshold is £41,700, the discount period would be 13 years.
• If the median is maintained but the general threshold is increased to £48,400, the discount period would extend to 16 years.

A useful recommendation is that the discount should be available for the full duration of the discount period, instead of only the length of time the first visa is granted for.

For the temporary shortage list, the committee recommends the general threshold is set at least as high as the 30^th percentile of UK full time earnings (around £30,900) and that occupation specific thresholds are set at the median for each occupation. The recommendation for the general threshold is made on the basis that roles on the list will not provide a path for settlement, if this changes then the threshold may need to be reconsidered to ensure a net fiscal contribution over the person’s lifetime.

The committee also recommended that the Home Office collect data from the Certificate of Sponsorship on discounts and the size of the business which would allow statistical analysis.

Another important point in the report is:

In our discussions, it became clear that many sponsor licence holders remain concerned, despite their best intentions to comply with all regulations, that they could fall foul of employment and equality laws if they do not hire someone because that person requires a visa. The government should consider clarifying (either in guidance or regulations, as necessary), that employers are not obliged to sponsor and can choose to prioritise candidates who do not require sponsorship. 

Annual report

The first section of the report sets out the committee’s fiscal analysis of the family visa route, confirming their earlier estimate that applicants entering the UK are likely to be fiscally negative over their lifetime, but noting that:

The MAC has previously emphasised that the fiscal impact of a migrant is an important measure of their effect on economic wellbeing, although it is by no means the only one.

It is good to see the committee dedicating a section of their report to the situation of overseas domestic workers, where the government promised action in the immigration white paper, but the detail of this is yet to materialise. Having spoken to both FLEX and the Work Rights Centre, as well as focus groups including people with lived experience from Kalayaan and Voice of Domestic Workers, the committee highlights the problems with exploitation and abuse of those on these visas and the limited options to those who are able to escape.

Various suggestions were made to improve employee protections. The committee also said that given the small numbers involved, the Home Office may want to consider granting settlement to the people who are still in the UK on a pre-2012 overseas domestic worker visa.

The committee also looked at English language requirements, noting that the government lacks evidence to assess the ‘right’ level of language proficiency to balance the competing goals of facilitating integration versus the negative impacts which can mean that families are separated and:

However, high language requirements may exceed employers’ requirements, in which case such requirements may exclude workers who would otherwise have brought economic benefits and technical skills that are in high demand in the UK. It is of course important to also highlight that the learning of a language and integration itself are processes, and proficiency can develop over time. Higher language requirements for settlement may in practice mean keeping migrants in temporary statuses for longer periods, which can have both costs and benefits in the short run, but in the long run might be expected to make social and economic integration more difficult.

The committee also raised questions about the availability of language lessons and what role the government might play in providing those. Lower levels of English proficiency among women and the difficulty that older people have in learning a new language were points that were also highlighted. The conclusion was that:

It will be important for the government to think about what data should be collected as they implement changes to language requirements on visa routes to enable an evaluation of these policy reforms. Without such data, it will not be possible to determine whether changes like those being introduced by the government in the recent Immigration White Paper are proportionate and have the intended effect.

Conclusion

The Chair pointed out in his letter to the Home Secretary that the committee is still waiting for a response from the Home Secretary on their report on the financial requirements for family visas, published in June this year.