Bulgarian and Romanian work permits won’t work

John Reid has today set out the Government’s proposals for a work permit system for workers from Bulgaria and Romania once they join the EU. While the announcement will play well with tomorrow's papers, it is missing the point. It is the perfect example of 'junk politics' - design a policy to get good coverage and then move on regardless of the consequences. In this post we explain why:

(1) EU law means the Government can’t stop people coming – so permits will only drive people into the illegal economy

Reid’s proposal would create a situation that is the worst of all worlds. Under EU law the UK is unable to stop people from Bulgaria and Romania from entering the country once they join the EU in January. They no longer need visas and will be given an automatic three month “right of residence” in the UK. They will have EU rights to work in the UK as self employed people, or be posted to the UK by Romanian or Bulgarian companies.

The Government has tried to imply that it can stop people from Bulgaria and Romania coming to the UK. However, the only action that EU law allows the Government to take is to restrict the numbers of Romanians and Bulgarians who can be employed by UK companies for between two to five years.

If such a work permit system is put in place all the evidence from the last round of enlargements in 2004 suggests that migrants will still come to the UK, but instead of complying with the complicated and bureaucratic permit system will choose to work in the informal or grey economy.

In a comparison of different systems put in place before the 2004 enlargement two academics looked at how the Finnish government put in place what it thought was a robust work permit system to limit the numbers of migrants. The new system succeeded in reducing the numbers of Eastern Europeans applying for permits, and applications dropped by a third. But the number of posted workers simply increased hugely. 18 months after EU enlargement the Finnish Government estimated that 10,000 workers had been posted to the country; more than double the number who applied for permits. Finland has now relaxed its work permit scheme.

Similarly, in Denmark it is estimated that three times as many posted workers (6,000) entered their country compared to those who applied for permits. Sweden, which had a completely open border policy and uniquely allowed full right of access to welfare benefits, actually had less immigration than Norway, which had stricter controls. Evidence also suggests that Germany, which had the most restrictive system, received more immigrants than any other country. According to official government estimates Germany received over 500,000 between May 2004 and September 2005, whereas the UK received just under 300,000 in the comparable period.

A work permit system will create another tier of effective ‘illegal’ immigrants operating outside the boundaries of normal UK society: not paying taxes, earning sub-minimum wage salaries - but still being entitled to use UK public services like the NHS.

(2) The Government should address the real problems - criminals from other member states should be made to leave the country

On the other hand, while EU law allows the Government to restrict numbers coming to work for companies in the UK it currently forbids it from stopping dangerous criminals from entering the country, or deporting them if they commit a crime in the UK.

Back in May Tony Blair told Parliament that “it is now time that anybody who is convicted of an imprisonable offence and who is a foreign national is deported.” He also said that foreign criminals should be deported "automatically".

However, just days before, the Government had passed EU legislation through Parliament, which states that “Expulsion orders may not be issued by the host Member State as a penalty or legal consequence of a custodial penalty” to EU citizens. That is why John Reid announced last week that the Government is no longer trying to deport criminals from other EU member states.

He told Parliament last week: “The immigration and nationality directorate has been taking a robust approach to the deportation of European Economic Area nationals, which has been defeated consistently in the courts. We will be changing the law to strengthen the link between criminality and deportation, but in the meantime we are no longer taking unproductive cases to the courts at the taxpayers’ expense, with negative results.” (Hansard)

The Government’s proposals will therefore create an absurd situation where Bulgarians and Romanians who want to work legally and contribute to the UK will be kept out - or more likely will turn to illegal employment - while dangerous criminals and those with no intention of working will be allowed in.

(3) Even Government ministers admit the permit scheme won’t work

This morning’s Times reported that Margaret Beckett believes that “the controls will be impossible to police because self-employed workers have an unrestricted right to come.”

As both the Telegraph and the Guardian have reported, there is considerable unease about the Government’s proposals from within the cabinet, with one unnamed minister quoted in the Telegraph dismissing the new curbs as simply “cosmetic posturing”.

For some suggestions on the how the system could be improved check out a pamphlet we wrote a couple of months ago.