City of London and PwC propose post-Brexit ‘regional visa’ system

The report sets out how such a system could work in practice and indicates how it could support economic growth outside of London.

The Government has not confirmed what visa regime will apply to EU migrant workers after the UK exists the European worker. If the current visa system were extended to EU migrants, research suggests that three quarters of the UK’s EU workforce would not meet these requirements.

This could undermine certain sectors of the economy reliant on international workers such as healthcare, agriculture and construction. In addition, City of London Corporation figures show how the Square Mile draws on a highly international workforce with 68 per cent of workers from the UK and 32 per cent international, of which 12 per cent come from Europe.

The report, ‘Regional Visas – A unique immigration solution?’ produced by PwC and commissioned by the City of London Corporation, is intended to stimulate debate in conjunction with the wider discussion about education and skills policy. It looks at how a flexible regional visa system could help businesses address their local skills shortages and potentially better integrate migrants into the community.

Such a new system could highlight where more work is needed to upskill or incentivise the local workforce, while the information could also support the Government’s pledge to create three million apprenticeships by 2020. The report makes clear that the current definition of a region for the purpose of such a scheme would need to be considered.

The report sets out two possible models for regional systems with the Home Office retaining overall control in each case:

· Under the first model, regional visas would be governed jointly by local authorities and business needs as they would be best placed to understand local employment requirements. A business would submit a case to the local authority, evidencing they had tried to recruit locally and nationally, and if the local authority concluded there was skills deficit, they would provide a recommendation to UK Visas and Immigration (UKVI). If approved by UKVI they would release a set number of regional visas to each business in line with local authority recommendation and the allocation would be listed publically.

· The second model recommends a system governed by UKVI. They would resurrect their specialist hub casework teams, using in-house industry experts, combined with regional knowledge, to judge the merits of cases put forward by business. They would approve a set number of regional visas and allocated them to the relevant employer.

The criteria for the regional visa could be as follows:

· Workers would apply for either a Short Term (12 month) or Long Term Skills Deficit visa (three years with an option to extend to six years, after which the migrant could seek permanent residency).

· Workers in the UK under the Long Term Skills Deficit visa would be eligible to apply for permanent residency once they had completed five years continuous residence in the UK.

· Candidates would be required to live (rent or buy) in the region where they worked. Candidates entering under the Long Term Skills Deficit visa could only obtain a mortgage in the region where their visa applied.

· Candidates could potentially switch employer or region if the business case in the alternative region existed and they held a Long Terms Skills Deficit visa.

· Business would need to show through a Revised Resident Labour Market test that they have tried to recruit regionally and nationally for the position. This would include local and national job advertisements and using head-hunters or recruitment agencies where needed.

Policy Chairman at the City of London Corporation, Mark Boleat, said: “Migration has always been a key element of a thriving and strong UK economy. What the Brexit vote has now done is give us an opportunity to re-look at our visa system and propose a model which is tailored for our regions and flexible for businesses. This is not a London solution to a national problem, but actually something that can support growth outside of the capital across a wide variety of sectors.

“Local businesses are best placed to know their employment needs in their area, so they should be playing the lead role in filling job vacancies internationally and addressing local skills shortages.”

Julia Onslow-Cole, head of global Immigration at PwC, said: “A regional visa could be an innovative approach to enable employers to balance local labour demand and availability with other overseas labour sources. Such a nuanced immigration system could help the UK meet its business and economic requirements post-Brexit.

“International businesses will still require access to the brightest and the best candidates in order to remain competitive globally. The regional visa system is a mechanism to specifically address skill shortages and as such it will not impede or discourage international placements.

“While for most multinationals the benefit of migration is clear, a regional visa could allow these benefits to be more keenly felt across the UK as skills shortages are identified and filled with migrants, helping the growth of that particular region. A regional visa would require time, energy and cost from business at the outset but, where there is a genuine skills deficit, the upside could be the ongoing success and viability of a business and the region they’re in. The agility of a regional visa could equip the UK to react quickly to changes in the employment needs of individual sectors and areas.

“The current environment provides an opportunity for businesses to talk openly about the challenges they sometimes face when trying to employ resident labour into certain roles, for example, within the hospitality and seasonal agricultural sector.”