Migration Advisory Committee: raise salary threshold and hike fees for foreign talent

Migration Advisory Committee: raise salary threshold and hike fees for foreign talent

The Migration Advisory Committee (MAC), an expert panel of government advisers, has published its recommendations on reducing skilled immigration, following a review held last year.  It has recommended relatively modest changes to the immigration system. 

Although these changes are not as drastic as had been feared, business representatives including the CBI, the British Chambers of Commerce, and London First have raised concerns about the impact on small businesses in particular of increasing the cost of hiring much-needed new talent - concerns that we share.

Asked by the Home Office to consider how to reduce the numbers of non-EU migrants entering Britain on tier 2 visas (those for workers skilled up to at least graduate level), the MAC have proposed the following:

  • Raising the minimum salary threshold for all tier 2 migrants to £30,000 (or £23,000 for new graduates). They propose that this change is phased in for some public sector occupations, particularly healthcare and teaching. However, they recommend that the specific thresholds for each occupation be kept at their current levels - an important distinction for the games industry.
  • An Immigration Skills Charge (ISC) as a skills levy on firms using migrant labour. This would be a direct payment by the employer for every worker they bring in on a visa, which the MAC propose be £1,000 per year per employee, paid upfront.
  • Use of the Tier 2 (Intra-company Transfer) route for third-party contracting to be moved into a separate route and given a higher salary threshold of £41,500.

The MAC were asked to consider several other options which they have rejected. In particular, they have decided against the automatic sunsetting of jobs on the Shortage Occupation List, and have argued that the Resident Labour Market Test should be kept, rather than moving to a system based only on an expanded Shortage Occupation List. They have also recommended that the government should not remove the automatic right to work from dependants of tier 2 migrants, on the basis that doing so would have no noticeable impact on immigration numbers and do nothing to reduce demand for skilled workers in the UK.

As the MAC is only an advisory body, these recommendations are not yet formal government policy, and may still be changed. However in the past they have had a good record of being accepted by government, and so it is likely that these changes will be adopted into legislation.

Ukie submitted evidence both to the MAC's initial consultation on salary thresholds, and to their wider review of tier 2.

Impact on games companies

The impact of the games industry is less than we had feared.  Following evidence received from members, we placed particular importance on the salary thresholds for individual occupations not being raised, as this could have seen companies having to pay significantly more in order to bring in the skilled staff they need. Although the threshold for tier 2 as a whole has been raised, this is to a level roughly in line with what many games occupations already face. We will now consult with members on the potential impact of this new proposal.

Sadly our opposition to a new levy - now called the Immigration Skills Charge - was not heeded. We remain concerned that this will directly raise the cost for games companies of bringing in the staff they need, making the UK a less attractive place to do business while doing little to improve the domestic skills supply.

The Shortage Occupation List is a vital part of the system, with 17 games-relevant jobs that companies can fill more easily with overseas talent. We have consistently opposed the 'sunsetting' of jobs on this list - removing them automatically after a set period of time - as we believe this would be highly counter-productive. It is positive to see the MAC continue to agree with this stance.