Damian Green reveals just how IT firms will sidestep new ICT rules

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I watched the Channel 4 news last night and found something within Jon Snow's interview with immigration Minister Damian Green very interesting.

They were discussing the government's new rules on immigration, including the raising of the pay threshold for Intra Company Transfers (ICTs). It is now a minimum of £40,000 compared to £24,000 before.

Snow asked Green whether the £40,000 pay threshold rule would reduce the amount of workers being brought in on ICTs.

Green responded by saying he thinks that businesess will bring people in for less than a year. It sounded like he was giving suppliers tips on getting around the new rule. Although it is quite an obvious one.

Here lies the problem for many UK IT workers.

IT workers will come to the UK on short tern projects. They will also be able to bring staff to the UK to learn how to do a UK job which they can then perform remotely. And I am sure offshore suppliers might find a way to rotate staff.

So these workers will not show on long term immigration stats and they will not be a drain on UK resources. So the government looks good.

Not if you are an IT professional who could have his or her job offshored and you are given the nice job of training your replacement to do your job remotely.

Reducing the figures on long term immigration looks good for the government because many of the UK population are concerned about immigration and the potential drain it has on resources. But IT workers will be no happier with the new rules because it will still be difficult for them to compete on price.

As a result it will still limit the prospects for the UK IT industry by reducing jobs for homegrown talent.

So it doesn't look like the pay threshold will do anything. Why does it not apply to all ICTs regardless of how long they are in the UK?

Association of Professional Staffing Companies (Apsco), which has campaigned about ICT abuse for years questioned the pay threshold being set at £40,000 .

Ann Swain, Apsco CEO said: "Whether the £40,000 minimum salary will reduce the number of intra-company transfers in the IT sector is debatable. The average UK wage for IT professionals is close to £40,000, and it is questionable how many workers earn less that that once they arrive."

"We will be seeking clarity from the Government on how the £40,000 minimum will be reviewed."

17 Comments

The government don't give two hoots about UK workers getting jobs or not, what really seems to preoccupy them is keeping large multinationals within the UK.

I have spoken to enough people around this problem in Government to know that whatever we say, no matter how we complain, whatever abuses are presented to them, they will go along with what business wants.

From what I've read they couldn't cap numbers of foreign workers coming in under ICT as this would have breached the GATT agreements.

Britain will pay the price long term, but what the hell, companies are saving money, and that's whats really important isn't it?, when the UK economy collapses who knows local workers may be able to undercut these foreign workers!

Its all political point scoring. There are 100s of 1000s of asylum seekers, illegals, east european criminals and prostitutes but lets just reduce the number of higly skilled migrants because they pay a lot of taxes and are not eligible for any state benefit.

@CodeCruiser: "...higly skilled migrants because they pay a lot of taxes and are not eligible for any state benefit"

No they don't, that's the whole point. ICTs in the IT industry are typically graduate trainees from India, who are imported to the UK to learn their trade at the expense of UK clients, UK IT workers, UK IT graduates and UK taxpayers. They are often paid a low salary at home (i.e. no taxes paid in the UK), plus a tax-free subsistence allowance in the UK (no taxes paid in the UK). Their employers charge their UK clients hugely inflated prices for the services of these inexperienced and relatively unskilled workers, then ship the profits offshore (no taxes paid in the UK). Meanwhile, every ICT is replacing a potential job for a UK-based worker - graduate trainee or experienced worker - who would have paid UK taxes but is unable to compete with people on Mumbai salaries when we have to pay UK living costs (and taxes). These unemployed UK IT workers often then become a further burden on the (remaining) UK taxpayers, as they end up claiming benefits instead of earning a fair day's pay for a fair day's work. So your ICTs are being used to screw the UK taxpayer, the UK IT industry and the UK economy out of tax revenues, skilled jobs and long term growth, all to feed the greed of a handful of profiteering multinational people-traffickers and their shameful puppets in politics and the media.

That's the kind of ignorance that irritates me. "Highly Skilled Migrants/Tier 1 General" are not same as Intra Company Transfers. To be eligible for Highly Skilled Migrant, one needs a masters degree, English language, age, experience and salary of £40000+ in past 12 monthes but no job offer. Nothing to do with any company or outsourcing. ICTs are the actual problem and they have not been touched!!!! Highly skilled migrants pay all UK taxes and NI as any other UK citizen but do not get anything in return.

>So your ICTs are being used to screw the UK taxpayer

That would continue and may even increase!

@CodeCruiser:
Sounds like we both recognise that ICTs are the problem, while the media and politicians are all talking about Tier 1 visas.

Actually Tier 1 visa immigrants have never been a problem as they have a completely level playing field with UK IT workers in terms of costs etc, as everyone is saying the real unfairness with immigration comes from ICT due to the tax breaks and allowances which means neither Tier 1 or UK nationals can compete with them financially.

As a matter of fact I think anyone coming here on Tier 1 has more right to be annoyed by this than UK nationals, if I'd gone to all the expense and trouble to emigrate to the UK via the Tier 1 route gone through all the expense and bother, only to find myself undercut by Tier 2 workers AND being made the whipping boy by the government I think I'd feel very angry.

@Matt
>while the media and politicians are all talking about Tier 1 visas.

That's why I said its all political point scoring. They tackled the visa category which was easier to tackle and does not involve EU or businessmen even though it makes the least difference. But hey, all that british public needs is that this government has fulfilled its promise of capping the immigration!

@BobF
That's exactly how I feel. I paid in excess of £3000 just in visa fees and gone through all that process. I have never been unemployed so ICT itself is not a problem for me. The real annoyance is being made the scapegoat.

I should have gone to Canada or Australia.

I have now moved to the Netherlands via Germany because of this, so while I haven't had your expense with visa's and such I am very angry at the way employment prospects in our industry have been destroyed for short term gain forcing me to become an emigrant

@CodeCruiser: "The real annoyance is being made the scapegoat."

May not be much comfort, but those of us in the IT industry know exactly where the real problem is.

@BobF: "I am very angry at the way employment prospects in our industry have been destroyed for short term gain forcing me to become an emigrant"

And I'm equally angry, as I'll be forced to take the same route when my current contract ends in the new year.

Well, I'd like to know if the 12 months ICT can be extended?

I would suggest that people write to their MPs and make them more aware of this issue.

The Daily Mail wrote that British IT workers were the big losers as a result of this cap. Which I agree with 100%

James:

Been there, done that, doesn't work, short of a major public outcry nothings going to shift the government on this, business and groups like Nasscom lobby them too hard to listen to ordinary nobodies like us.

@BobF - we should write to our MPs.
If one person does then that probably won't make any difference but if thousands did...

It only takes 5 minutes using:
http://www.writetothem.com/

I guess Theresa May's announement will be discussed properly in parliament in the next month. Tell your MP how you want the proposals changed.

The all party group on Balanced Migration has already stated they thought the salary limit should be £50k.

If enough people tell their MPs that it is a ridiculous loophole to allow ICTs paid as little as £24k including expenses for less than a year, and that £50k is also more appropriate, then it can't hurt and might swing things.

I am an IT professional based in UK. I was a permanent employee of an IT consultancy company. Two ICTs came to our project and are trained. They went back to offshore to add more there and do job remotely, we six (were asked to) go out of company one by one.

Hi CodeCruise,BobF and Matt- I completely agree with the three of you. I think that Tier 1 should be kept and the salary limit for ICT should be £50k even if they come for a month. This would be fair to the workers coming in and the local workers. I guess the other point is we can talk all we want to but the business always wins :). It is hardworking people like us that have to suffer. Please note that I had been planning to come to London on a tier 1 and it would have been a risk for me as I would have to come there and find a job. So I don't really understand the need to canel Tier 1. Has anyone looked at the numbers? How many people entered UK on Tier 1 in 2009, maybe 10,000. How many came as ICT- 50,000+, you do the math.

I agree that the majority of tier 1s/HSMPs are well paid, tax paying professionals. Almost all that extend will be earning more than £40k. They will be a great fiscal and economic loss to the UK.

Even those that are unlucky not to find good jobs when they first come and maybe end up in fast food joints pay more tax than half the ICTs.

It is because they can move jobs that they contribute most.

Big business have conned the UK into handing the control of immigration to them so they can profit. Tier 2 workers are tied to their employers so they are unlikely to complain or get a fair salary. They make great employees because the employer controls their very right to be in the country.

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This page contains a single entry by Karl Flinders published on November 24, 2010 5:21 AM.

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