EU Migration

On January 1st this year people from Romania and Bulgaria gained the same working rights as other European citizens in eight European countries, including the UK, Germany, Austria and France. This has fuelled a widespread perception in the UK that the floodgates would be opened to mass immigration, further pressurising the welfare state.

It has provided the backdrop to an the going debate amongst the three main British parties about the costs and benefits of immigration, and has lead to demands for changes to immigration policy, particularly migrant access to public services, including benefits. It is argued that Britain’s welfare system which is largely non-contributory, is more open that those of many EU countries and is acting as a magnet to welfare tourists.

EU citizens are entitled to free movement within the EU but there are some restrictions on the right to live in the UK. There is an initial right to reside for 3 months but after this period they only have a right to reside if they are exercising their treaty rights as a worker, self-employed person, job seeker, student or self-sufficient person, or if they pass the Habitual Residence Test.

With  European elections looming in 2014 and national elections in 2015, David Cameron’s Conservative Party is under increasing pressure on this issue as they risk sharing the pool of likely voters with the anti-immigration party, UKIP. To fulfil its promises to cut net migration  and bolster support amongst voters they are proposing to change British law for new EU immigrants in an attempt to deter those seeking to take advantage of the UK’s welfare system. Measures proposed include EU migrants having to wait 3 months before they can obtain unemployment benefits; not being eligible to housing benefit; and losing the right to unemployment benefit after 6 months unless they have proof of a realistic chance of finding work. It is envisaged that these changes to protect the benefit system will have widespread support whilst not deterring genuine workers.

There is also a call for the reform of freedom of movement at EU level, a long term overhaul which may require treaty change. Theresa May, home secretary, proposed that accession countries are phased in to full free movement rights when they reach a certain level of income or economic outlook, with opportunities for national government to cap migration if there are economic concerns.

These attempts to curb migration have provoked a  backlash from within Europe, and the European Commission is taking the UK government to court over what it sees as discriminatory practices over the right to reside. Freedom of movement is one of the basic rights of EU citizens, and seen by many as essential to the globalised world of open markets and frontiers. Martin Schulz, the European parliament’s president has said that while he takes the UK demands for reform within the EU very seriously, there was no question of parliament agreeing to reopen the rule book on free movement.

Many believe that immigration has, on balance been good for Britain’s economy. A belief borne out by most academic research, with the 2011 study, Unemployment Benefits and Immigration: Evidence from the EU, finding no statistically significant causal effect between social welfare spending and immigration. Robert Chote, head of Office for Budget Responsibility, told MPs at a Treasury select committee last Tuesday(14/01/14) that the country’s fiscal position would be “somewhat worse” if net migration was lower, because immigrants are more likely to be of working age. They also arrive when another country has already picked up the tab for educating them, and will leave before they reach a point at which they’re most expensive in terms of pensions and healthcare.

The Conservative’s target to cut net immigration to below 100,000 per year by 2015 looks increasingly unlikely to be met. One option that could be taken to reach the bar would be to exit from the EU, a move that may be popular with sections of the electorate and the referendum on that is not due to happen till after the election in 2015. Vince Cable, business secretary, believes uncertainty over whether the UK will leave the European Union – dubbed the “Brexit” – is spooking investors and is holding back a full economic recovery.

Meanwhile the Immigration Bill 2013-14 is due to have its report stage and third reading on Thursday the 30 January 2014. The summary of the Bill is:

To make provision about immigration law; to limit, or otherwise make provision about, access to services, facilities and employment by reference to immigration status; to make provision about marriage and civil partnership involving certain foreign nationals; and for connected purposes.

Regardless of the progress of this bill, the UK still needs to attract highly qualified and talented people in order to compete on a global scale.

If you need a visa to work in IT, Engineering, or Finance then Commonwealth Contractors may well be able to help.

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