Boris Johnson proposal for new 'Australian-style' immigration rules after Brexit rejected

Proposed changes will cut immigration after Brexit, but also reduce size of UK economy, says expert panel

A review of government plans for new immigration rules after Brexit has rejected Boris Johnson’s proposal for an Australian-style points-based system for the bulk of migrants.

The Migration Advisory Committee recommended the use of points - earned on factors like age, qualifications and previous study in the UK - only for more highly-skilled migrants without a job offer

Chairman Alan Manning described the prime minister's promises of an Australian-style system as a "soundbite" and urged him not to repeat the "mistakes" of earlier attempts to impose a points system more widely.

As he launched the report in Westminster, Prof Manning revealed he had been sacked, saying that ministers had turned down his application to serve a second term as chair of the panel.

For most would-be incomers, the independent expert panel backed a minimum salary level, cut to £25,600 a year from the £30,000 proposed under Theresa May’s premiership.

The proposed cut will be welcomed by employers, but does not meet the hopes of industry bodies which last week appealed for a minimum of around £20,000 in order to allow continued access to labour in skilled but low-paid jobs like lab technicians, carpenters and care home managers.

An Australian-style points system to reduce overall immigration was one of six "guarantees" on the first page of the Conservative manifesto for last month's general election, with Mr Johnson presenting it as a key part of reducing arrivals of workers with lower skills and halting downward pressure on wages once free movement of EU nationals is ended at the end of the Brexit transition period on 31 December 2020.

But the report found that the points-based framework previously introduced by Tony Blair in 2008 had proved "pointless" because the assessment of applicants' characteristics such as age, qualifications and experience was "ineffective or overly complex". Instead it recommended sticking with a salary threshold, which would prevent undercutting of the labour market by cheap foreign employees.

The MAC said its recommended changes were likely to reduce levels of immigration and the overall size of the UK economy, though they would increase GDP per capita “very slightly” and make a “small” contribution to reducing pressures on the NHS, schools and social housing.

But it warned that the new immigration system being introduced from January 2021 - under which EU nationals will no longer have the automatic right to settle and work in the UK - will increase pressure on the crucial social care sector, where industry representatives last night warned of closures and increased costs.

The MAC expressed “concern” over the potential impact of the loss of EU workers on the social care sector, but said the root cause of its problems lay in “the failure to offer competitive terms and conditions”, rather than the immigration system.

Under the MAC’s recommendations, the bulk of workers coming to the UK would do so on the basis of a job offer meeting the £25,600 minimum, with lower thresholds for teachers, skilled NHS workers and under-26 “new entrants” and higher pay requirements in high-income occupations.

The points-based system would be applied only to skilled workers without a job offer, who would be expected to register an interest in coming to the UK, with monthly invitations to apply drawn from the pool of those who put their names forward. But the Government should place a cap on the numbers of visas issued under this route, and "proceed with caution" on numbers.

The report rejected calls for regional variations in the system, such as the "Scottish visa" demanded by Scottish First Minister Nicola Sturgeon.

Instead, it recommended that the government should pilot the introduction of a special visa targeting the specific problems of remote parts of the UK.

Prof Manning said: "Our recommendations are likely to reduce future growth of the UK population and economy compared to freedom of movement by using skill and salary thresholds.

"We estimate very small increases in GDP per capita and productivity, slightly improved public finances, slightly reduced pressures on the NHS, schools and social housing, though slightly increased pressure on social care."

He added: "No perfect system exists and there are unavoidable, difficult trade-offs. The largest impacts will be in low-wage sectors and the government needs to be clear about its plans for lower-skilled work migration.

"The government should ensure that the mistakes of previous UK points-based systems are not repeated."