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Sunday, October 29, 2006

Reid rowing back - already?

Today's Sunday Times reports (sans hat tipping) a story which came to our attention a couple of days ago.

When the Home Office announced their rather confusing work permit scheme for Bulgarians and Romanians at the start of the week, they said that they would be allowing a maximum of 20,000 permits to work legally in the UK:

"Low-skilled migration from Bulgaria and Romania will be restricted to those sectors of the economy where the UK already has low-skilled schemes and will be subject to a strict quota which will not exceed 20,000 workers per year.

The largest number were to be allowed into the UK via food processing (3,500 places) and the Seasonal Worker's Scheme, known as "SAWS" (16,250 places), which are currently shared between non-EU countries.

The Home Office (via its regional "managed migration units") wrote to farmers warning them that come the 1st of January, they will have to stop using the non-EU employees they have worked with under the Seasonal Workers Scheme. The problem, as the Home Office admitted in their letter, was that farmers have already signed contracts with non-EU workers (mostly Russians) for 2007. The Home Office letter admits: “I am aware this is not welcome news”, and also offered to find a loophole, in order to “take proper account of your existing recruitment commitments”.

Apparently farmers were less than happy, and now are threatening to sue. They say that the Home Office's interpretation of EU law is wrong. The Home Office had argued that non-EU workers had to be squeezed out in favour of "EU citizens" because of the doctrine of "Community Competence" - the idea that people from the EU can only be recruited for a job if no-one in the EU can do it. But apparently that doesn't need to be applied during the transitional years after accession.

So the Home Office is now offering farmers a deal whereby only 40% of the places on SAWS (i.e. 6,500) will initially be offered to Bulgarians and Romanians, taking the total quota down below 10,000.

The Sunday Times reports that, "The Home Office admitted the number of legal work places for Romanians and Bulgarians next year would be lower than announced “while we finish phasing out the other schemes”."

Does any of this matter? In one sense no - as we have argued before, given the basic right to free movement and various legal rights under EU law to work in the UK, the majority of people will either find ways to circumvent or simply ignore Reid's system. Indeed, the fewer permits to work legally, the more people will work illegally. More people in the black economy is bad for taxpayers and people on low incomes. But it does have the advantage, from a Home Office point of view, of making the "official" numbers look smaller.

But in another sense this story does matter - a radical change of plan just a couple of days after the system was launched shows what a cobbled-together and poorly planned operation the Home Office are running. That's worth remembering when you hear Reid promising that the EU's "e-borders scheme" will offer us "a revolution in border control". Uh oh...

1 comment:

Anonymous said...

I am a european investor in the UK. Over the last 20 years my family's companies have invested £75 million. We provide employment with decent (european style) conditions to our 328 employees. In recent years (particularly when the UK didn't set a course to join the euro) we stopped our investment as we now perceive the UK economy as a lopsided bet on a japan-circa-early-90es-style property bubble.

Accordingly we have divested any real estate in the UK which we feel is "irrationally exuberant" and is very likely to crash. We feel that this is true even with the stimulus of running a very aggressively competitive tax and worker rights regime within the single market in effect taking investment which would otherwise be in other european countries to the UK.

Given this fact we are alarmed by the hysterical quality in British euroscepticism. We feel there is a public hysteria whipped up by the Murdoch press which may sell newspapers but its not in the interests of this country. The influence R Murdoch has over Britain via the Times the Sun and Sky over Britain is of Berlusconian proportions.

We have already drawn plans to reduce our exposure to the UK for purely economic reasons, we may well relocate entirely in Bratislava, Slovakia if the same nationalistic rhetoric persists in making us feel that there is a risk of withdrawal. So far we have found that new europe has much better educated and productive people and policies that are in line with reality.

The UK is becoming bureaucratic not due to Brussels, its the unresponsive overpriced and low quality services and property but also there is widespread dishonesty in Banking and insurance and business services, it is generally bad value for money. Banks in particular are a law on to themselves. The personal loan bubble is likely to burst along with the housing one.

The fact that UK employees have much less security and rights than the rest of the EU has made up for the currency risk so far, but if this overpriced and overconfident country continues its direction in pulling out of the EU project this will give us reasons to think pull out our investments from the UK altogether.