News Analysis

Will caps on IT immigration just win votes or create a successful compromise?

Karl Flinders

Will caps on IT immigration just win votes or create a workable compromise?

If elected, the Conservatives will make changes to the current migration system by putting limits on the number of workers permitted to enter the UK on Intra Company Transfers (ICT).

With an election looming any unpopular policy is sure to be seized upon by opposition parties. ICTs fit this bill.

The ICT scheme allows staff to apply for a permit to transfer to the UK from an overseas branch of their employer. But there are accusations that the system is being abused by Indian offshore IT service providers. Indian workers are being paid far less than their UK equivalents, which is not allowed under ICT rules. Also, ICTs are only supposed to be permitted when there is a shortage of UK skills to fill posts, which is often not the case.

A recent freedom of information (FOI) request made by a Computer Weekly reader revealed the massive number of foreign workers entering the UK on ICTs, despite rising unemployment.

The data showed that for the year December 2009 to December 2010 45,924 ICTs were granted out of 62,589 requested. A large proportion of ICTs consist of IT staff from India.

The numbers are increasing every year. During the dotcom boom in 2000 only 12,726 IT workers entered the UK on ICTs, according to a FOI request made by Association of Professional Staffing Companies (Apsco). Seven Indian companies accounted for 43% of the IT workers entering the UK on ICTs in 2008, according to more figures obtained by Apsco.

"It seems extraordinary that when British workers can't find jobs we are bringing foreign workers from halfway round the world. This is another sign that Gordon Brown's 'British jobs for British workers' was a meaningless sound bite," says shadow immigration minister Damian Green.

The Tories plan to keep the existing points-based system, which allows IT professionals into the UK if they score highly enough on a range of measures. But the numbers will be capped.

"The one big gap in the points-based system is that there is no overall limit on how many permits can be issued in any one year," says Green.

One industry source dismisses the move as mere electioneering. "This is a fairly blatant attempt to win votes. The reality is that western European countries all have ageing populations, and outsourcing or immigration will be one of the key ways of remaining competitive," he says.

But one IT worker recently displaced as part of an offshoring agreement says: "[The Tory plan] looks good, but the term 'migrants' is a worry. This suggests a long-term stay, when in fact the problem is due to ICTs on a short stay, perhaps a year or so. But it is better than Labour's approach by a mile."

Mark Lewis, of commercial law firm Berwin Leighton Paisner, also sees the logic behind the move.

He says, "There is no reason to have an infinite number or even such a high number of ICTs issued. So a quota may be the fairest way forward for offshore IT suppliers and UK business."

But the Unite union is against the Conservatives' plan to cap ICTs. Peter Skyte, national officer for IT and communications at Unite, says migrant workers play an imortant role in the UK economy, although he adds that a better balance is required.

"We do believe that there is a need to strike the right balance between enabling employers to recruit or transfer skilled people from abroad, providing fair access for UK and overseas migrant workers, and protecting job and career development opportunities for resident workers."

This, he says, is necessary to enable UK IT professionals to move up the value chain within their chosen occupations. "We are, however, opposed to the Conservative proposals for an arbitrary cap on migration numbers."

Ann Swain, CEO at Apsco, says there is nothing wrong with the current system but it is being abused and needs to be better enforced. "There seems to be no appetite to police it," she says.

John Brazier, managing director at the of Professional Contractors Group (PCG) believes applying a cap to the number of ICT workers entering the UK would be wise. "While ICT permits clearly have a value, their abuse and overuse is damaging. I hope the annual cap proposed by the Conservatives would be extended to ICT permits as a way of dealing with the displacement that has affected many contractors."

But he adds that the main issue is not the ICT permit itself, but the abuse of the system. "What we need is better enforcement of the rules, and a way to ensure the marketplace is as fair as possible. ICT workers being paid less than the minimum salary undercut contractors."

An influential source in the outsourcing industry says, "The UK would be terribly handicapped if it closed it borders to talent, no matter where it comes from."

Political change leads to changes in legislation, but many proposals disappear without a trace. The Tory plan to cap ICTs is taking IT industry issues to a high level. But whether the scheme will be changed in the event of a Conservative victory, or whether it needs changing at all, is less certain.


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