In a speech given at EY's London Bridge offices on Monday 21 May 2018, Miles Celic, TheCityUK Chief Executive Officer, discusses what is needed from a post-Brexit UK immigration system if Britain is to remain globally competitive.
Good morning. Thank you for joining us for the launch of TheCityUK & EY’s report on the UK’s future immigration system. Before I begin I’d just like to say a huge thank you to EY for hosting today’s event. I would also like to thank everyone who has been involved in this project. Special thanks are due to the team at EY, in particular Omar, Margaret and Tim, for their work and contribution to this important debate.
Talent - home-grown, from the EU and from the rest of the world - has consistently been the top priorities for the financial and related professional services industry. A global and outward-looking industry like ours, needs to be able to employ the right people with the right skills in the right location and at the right time. A framework that allows this will help the UK maintain its attractiveness as a financial centre.
Brexit casts a long shadow over many debates. But it is also an inflection point. It potentially provides the UK with a greater ability to influence certain factors that determine its international attractiveness. Foremost among these is talent. The UK will have complete control to get it right, or to get it wrong.
Brexit has served as a catalyst for many important conversations around the production of this report. While the work we are launching today is not about Brexit, it is of course inextricably linked to it.
Right after the referendum we consulted with our members to identify the industry’s top Brexit priorities. These were very clear:
1. A status quo transition arrangement
2. Mutual Market Access based on mutual recognition and regulatory cooperation
3. Mutual access to talent
We have made progress, but until these priorities are secured and finalised, the UK should lead the way in designing a flexible underlying immigration system that can later on be topped up by bilateral agreements, crucially with the EU.
The importance of ensuring continued UK access to international talent was firmly stated in our report published last year which set out our vision for a transformed world-leading industry. The UK-based financial and related professional services industry should attract the best talent from home and internationally, drawing upon Britain’s reputation as one of the most desirable places to live and work, and its status as a global business hub. It must champion diversity and inclusion, attracting highly skilled talent, from younger generations and varied backgrounds. It must be able to attract those who want to work in some of the world’s most successful and well-known companies, as well as people who want to come here to start and build the global success stories of tomorrow.
This is ultimately in the industry’s interest, in the UK’s interest and, most importantly, in the interest of our customers.
Of course, immigration is not just a one-way street and UK citizens benefit from the ability to live, work and travel in other countries. That is why mutual access to talent is such an appealing solution. However, for the purposes of our report, we have focused on recommendations the UK can implement unilaterally. Although out of scope for this report, we will continue to encourage UK and EU negotiators to ensure mutual access to talent post-Brexit.
Immigration is of course a politically sensitive subject. There is, however, a widespread understanding and acceptance of migrants who bring highly valued skills, and contribute to our economy. Of the businesses that we surveyed, 84% of their non-UK workers help fill UK worker skills shortages. International students also contribute heavily to our economy: approximately £20bn per year, according to a study published study earlier this year from the Higher Education Policy Institute.
When the UK leaves the EU, freedom of movement will come to an end. As it currently stands, EU citizens will become subject to the existing immigration regime for non-European nationals. However, this simply won’t be good enough. The system must be reformed to enable the UK to retain its competitiveness. Visa processing should be simple, low-cost and flexible. It should be possible to quickly reorient the system to fit changing skills needs and the different talent profiles required.
Our report sets out recommendations on how the UK’s immigration system can be adapted to ensure continued access to overseas talent from both within and outside the EU. This is vital to achieve the business objectives of the financial and related professional services industry and the wider economy. In future work we will also look at how we can better encourage and secure the untapped talent in all of Britain’s communities. But for today, we are focussed on the important role and contribution of the UK’s international workforce.
The Migration Advisory Council (MAC) is undertaking important research into European Economic Area (EEA) workers in the UK labour market. We hope that our report will inform the MAC’s work as well as other initiatives on the UK’s future immigration system.
Our report proposes a new streamlined immigration system that can be implemented immediately and would then be supplemented by bilateral agreements with other jurisdictions, including the EU, as and when these are agreed. This research makes a series of recommendations for what this renewed approach should look like. A summary of the key recommendations will be given by Margaret and Tim shortly. However, I will set out three key reflections:
Firstly we must have a system that benefits the whole of the UK - London is clearly a vital asset for this industry and the UK – but, any future immigration system has to benefit the country as a whole and be sensitive to the needs of all the UK’s nations and regions. Of the 2.3 million employed by our industry, two thirds work outside London. With the current system, 37% of financial and related professional services firms face difficulties engaging non-EEA staff to work outside of London and the South East. The operation of the immigration system should not prioritise the needs of any one UK region or home nation over another. It must be dynamic, taking into account regional variances in pay and skills shortages.
I also want to emphasise that all of the report’s recommendations apply to the whole economy. Although the evidence we collated comes from the financial services and related professional services, the recommendations, we believe, would be beneficial for all sectors.
Secondly, we must have a system that looks at talent holistically– our recommendations would enable a framework that helps attract the best global talent throughout their career and with different skill sets. It would encourage international students to study and work here, especially in skill shortage areas such as STEM and digital. We welcomed the recent news that London was voted the best city in the world for university students. This highlights the global attractiveness of the UK as a place to study, work and live. We must ensure this continues.
Equally, while the industry relies on a highly skilled, multinational workforce, it also depends on others. From the entrepreneur to the person who maintains the buildings, we need a variety of skills and backgrounds to ensure future success. In particular, medium skilled roles have often not featured in the public debate on immigration. A system that looks at talent holistically also provides a more nuanced perspective on skills.
Finally, we must have a system that drives our global competitiveness – to do this we have to ensure that the UK has continued access to overseas talent post-Brexit; that it continues to be an attractive destination and that it maintains its reputation as an open and welcoming country, ready to engage and do business with the rest of the world. We believe in creating a flexible immigration system which can be nimble in the face of change, a fair immigration system that draws upon those outside government, to shape its purpose.
Britain’s future international success as a centre for financial and related professional
organisations will be built on being open, not closed to the rest of the world. A measure of that openness will be the quality of the people attracted to the industry and to the UK as a focal point of excellence. The pool of global talent and expertise currently here assembled in Britain creates a competitive advantage and in turn attracts others who choose to work here.
And so, we must preserve the UK’s reputation as a country that welcomes innovation, entrepreneurial spirit and skills from the very best, the brightest, the hardest working, the most innovating.
This report is, we hope, a roadmap to that vision of the future.
It is, I believe, the most comprehensive set of proposals put forward by any industry and has been made possible through the time and insight of practitioners from across Financial Related Professional Services and beyond. In total, over firms have been involved in its production. I would like to thank them all. I would also like to thank today’s panellists; Tim Loughton MP, of the Home Affairs Select Committee, Jill Rutter, Programme Director, at The Institute for Government and the reports authors’ Margaret Burton and Tim Whittaker, of EY.
And thank you to you also for attending today’s launch.