Proposals to limit economic migrants' stay in the UK to five years unless they meet earnings thresholds risk seriously damaging the UK's universities and high tech industries, a group of the country's leading economists warned on Monday.
In a letter to the Financial Times, 15 academics, including the Nobel laureate Christopher Pissarides, said that preventing migrants who earn below a suggested threshold salary of £31,000 from extending their visas would be "deeply damaging to the competitiveness of the UK science and research sectors, and to the wider economy."
Richard Portes, a signatory to the letter, is a professor at the London Business School and holds academic positions across the world. A fellow of the British Academy, he came to the UK on a Rhodes scholarship, and, he said, would not have been able to stay in the UK, had the proposed system been in place when he arrived in the 1960s.
"I was appointed as a fellow of Balliol College in 1965 and in 1967 I was earning approximately £1,600. That today, scaled up by the rate of inflation, is £22,000," he told the Huffington Post UK.
"I would have been kicked out. I'm sure there are some people who would be delighted, but on the whole I think my contribution has been a net positive. I think similar considerations would be made for Sir Partha Dasgupta and several other signatories."
Bangladesh-born Partha Dasgupta is an emeritus professor of economics at Cambridge and a globally-recognised authority on development and climate change. He is one of a number of signatories, including the Japanese Nobuhiro Kiyotaki and Australian David Vines, from outside of the EU.
According to the letter, they might well have been excluded.
"Had such a policy been in place when some of the signatories to this letter were considering coming to the UK, they might have chosen not to come at all, or would not have been allowed to remain," the letter said. "We believe that this would be deeply damaging to the competitiveness of the UK science and research sectors, and to the wider economy," it reads.
"The policy could almost have been designed to deter the migrants the UK most needs; and, for those who do come, to expel many of those we would most like to remain. One cannot identify the next generation of entrepreneurs or Nobel laureates only a few years into their careers, and certainly not just by looking at how much they are paid."
"The politics of migration are poisonous," Portes said. "It's partly due to a completely misconceived government policy. The policy as you know is aiming to cap net migration. Well, that's clearly not possible, because they can do nothing to control either in migration or out migration from the rest of the European Union. What they're trying to do is to reduce to very small numbers the in migration from outside the European Union.
"That leads them to these very foolish ideas about imposing some kind of minimum income on people who, after five years, they're kicked out if they're not earning enough. It's completely bizarre."
Many highly qualified individuals come to the UK as postgraduate or post-doctoral students, typically taking between three to five years to complete qualifications. With research salaries low, the likelihood of them passing the threshold would be remote.
"We have a pretty competitive universities sector. We produce a lot of very good people. I assure you, this could be crippling. Really crippling," Portes said.
The wider economy is also likely to suffer. The government has made diversification away from financial services and into high technology, research-led industries. These measures risk cutting off a supply of talent to industries in their embryonic stages.
"Look at Silicon Valley. In Silicon Valley there are 150,000 Indian software engineers. How many of them, under a policy like this, how many of them would have ended up in California? Not a lot," Portes said.
Richard Portes has now become naturalised, and is audibly agitated by the "irrational" idea of thresholds.
"We ... hope that our politicians are a little more rational than the people out there who are calling 'repatriate them all'. Fortunately I now have a British passport, so I can't be repatriated. But I wouldn't say it's out of the question that they're going to try at this rate," he said.
Portes' son, Jonathan, the director of the National Institute of Economic and Social Research and former chief economist of the Cabinet Office, is another signatory to the letter.
"If you look at George Osborne's speech to the Conservative Party conference a month ago in Manchester, he highlighted these two University of Manchester scientists [Andre Geim and Konstantin Novoselov] who discovered graphene, that apparently may or may not lead to something. They got the Nobel Prize for that. They're both Russian-born, and one of them came here as a post-doc," he said. "Now, I don't know what a physicist gets paid a few years into a post-doc, but it's not a lot."
The Migration Advisory Committee (MAC), whose consultation produced the threshold figures of between £31,000 and £50,000 as a minimum - actually a far lower threshold than the government's initial proposals - said that the scheme could cut non-EU migration by 2/3 in five years, but would slow growth by 0.29% of gross domestic product.
"For me, it just illustrates that the government claims that it is putting growth first and that growth is the highest priority, but that isn't being translated into practice. They're worrying about a few rather minor employment regulations on the margins, where there isn't really much evidence of an effect on growth one way or another, and at the same time they're letting the Home Office pursue an agenda which is clearly anti-growth," the younger Portes said.
"It may well be the case that enforcement on this has been a bit lax, and it may be the case that if someone's been let in to do a post-doc or a fellowship in physics and five years later they're working as a taxi driver. You might say that they should leave. But this goes much farther than that. The fact is that as far as we can tell, of those people who do stay, who want to stay after five years, most of them are doing pretty well. They were skilled when they came in, and if they stay it's because they've been reasonably successful in the labour market and they're doing something productive."
Matt Cavanagh, associate director at the Institute for Public Policy Research (IPPR) also signed the letter. He, like both of the Portes, said that the charged politics of immigration make it difficult for government to base their approach on economic rationale. However, he added, polls show that British people's responses on immigration are less binary than many would expect.
"If you ask people a straight question - do you want there to be less immigration? - they say yes," Cavanagh said. "But if you dig down and ask what kind of immigration they worried about, they're not worried about skilled workers or students. A surprising number of them say it is illegal immigration that they want reduced. The other thing they want to see reduced is low-skilled immigration, most of which is from the EU and the government can't do much about.
"At the top line level the political arguments are very strong for seeming to be tough on immigration. The problem is that now in government they haven't been clear with people what the policies are that are going to deliver this target."
Labour's points system was imperfect in its execution, but it offered more flexibility than hard thresholds, Cavanagh said. New Zealand, Australia, Canada and Denmark have all deployed points-based systems to assess incoming migrants. There is no simple way, he said, but more sensitive systems are possible.
"I hope that they will temper the plans a bit and perhaps lower the threshold," he said. "But there will be skilled people who are net contributors who will be excluded under these plans... I know there are political imperatives around immigration, but there are a lot of examples of where it runs counter to what you might be doing for economic reasons."