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Rising Fees to Migrate to the UK After Brexit To Impact Businesses in Wales

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This article was written by Olivia Bridge who is the political correspondent for the Immigration Advice Service – the UK’s leading organisation of immigration lawyers. |@IASimmigration

The immigration rules have transformed rapidly since 2010 and accelerated even further under Theresa May’s ‘hostile environment’.

As many as 5,700 changes have been made, extending the original rulebook to double its initial length and prompting leading immigration and asylum barrister, Colin Yeo, to call for a “substantial rewrite” of the rules last year.

However, the biggest immigration shakeup to date lies just beyond the horizon – Brexit. So far scheduled for 31 October later this year, the “skills-based” immigration plan follows not long after and will be applicable to all EU entrants by early 2021. For businesses, employers and staff in Wales, this requires strategic planning and budgeting ahead.

Increased costs for migrants

A key concern at the heart of Brexit for the Welsh Government revolves around the Work Visa financial requirement which dictates workers must earn a minimum of £30,000 in order to enter and work in the UK. Counsel General and Brexit Minister, Jeremy Miles AM, said that the “threat of a £30,000 salary threshold” could “do so much harm to our economy” when such restrictions also apply to EU nationals.

However, the income threshold isn’t the only hurdle that could prevent migrants from making the move: the rising and extortionate fees to migrate to the UK is another prevailing deterrent.

Costs have skyrocketed way beyond inflation over the course of a decade. Fees rose twice just in 2018 alone while Indefinite Leave to Remain has shot up by 127% over a five-year span. Although the Immigration Health Surcharge (IHS) has raked in over £660 million into the UK economy, the most recent rise – inflicting a cost of £2,000 for migrants on a five-year stay this January – is just one of multiple costly deterrents for migrants looking to relocate to Wales. The latest cost change occurred this March, although this time by only a couple of pounds.

Yet this doesn’t even include the visa itself. A Tier 2 Work Visa costs £1,220 at a basic rate – and additional hidden charges quickly mount up through English language tests, document translation services, lawyer fees, fast-track or priority services and if the applicant is bringing children or dependents with them. After coughing this up, they must have at least £945 in savings.

The concerning aspect of this is that the UK has long relied on EU talent to fill widespread workforce shortages, yet costs to migrate are now so high that businesses fear the charges will sour the UK’s attractive pull.

In a report examining the post-Brexit immigration vision by the Wales Centre for Public Policy, the report found that Wales “will be affected more than the UK as a whole by the cut in the number of people migrating to work” and, although the “overall impact on the Welsh economy is projected to be less than that of the UK economy”, the loss of EU migration cannot be underestimated.

Increased costs for businesses

The end of Free Movement for businesses also incurs some substantially high costs when it comes to recruiting EU staff. For every non-UK recruit in post-Brexit Britain, businesses will have to follow costly – and lengthy – processes to legally hire from overseas.

The first step is securing a Sponsor Licence which, at the high end, can cost up to £25,000. The licence also requires renewing every four years. The Confederation of British Industry (CBI) criticised the necessity of this process for being “prohibitively complex, time consuming and an expensive process to navigate”.  Although the UK Government’s Immigration White Paper proposes the process will be “streamlined” after Brexit, it is still unclear as to how the Government intends on improving it.

Immigration fees for employers do not end there either: every new employee must be issued a Certificate of Sponsorship by their new employer which costs businesses £199 every time, plus a £1,000 Skills Charge. Although these fees may seem manageable, smaller businesses and start-ups could be elbowed out of recruiting talent across the continent entirely.

To overcome the inevitable shortfalls, UK businesses will have to raise wages while simultaneously reign in their expenditure, just to stay afloat and appear attractive in the market. Yet without reforms to the rising fees it takes just to get to the UK, their efforts could all go to waste: EU workers might rather work in one of the remaining 27 EU member states where mobility is frictionless and, crucially, free of charge.

Jeremy Miles noted:

“Nurses, junior doctors, vets and a range of workers we need for our public services and industries will find it much more difficult and less attractive to come to Wales under these proposals. The immigration system should help our economy and people, not stifle it and limit its potential.”

Clearly without radical reforms to the rising fees and without some relaxed rules for certain industries or workers, Wales – especially in rural areas where recruiting is already difficult – will fall behind. As a dire consequence, businesses may have little other choice but to suffer under skills shortages and widening vacancies, or turn to recruiting underqualified residential workers just to overcome the costs. Either way, this model is not practical or realistic for Wales, nor the economy at large.