They don’t work hard enough. They can’t be bothered to learn English properly, to master rudimentary mathematics or other basic skills. They choose welfare over work. So let’s clear the way for the industrious youngsters who take Lord Tebbit’s advice by travelling far and wide to find work. Yes, it’s time to limit the number of British people allowed to work in the UK, so that we can hire more immigrants.
That, at least, is the conclusion you might draw from reports this week from the National Institute for Economic and Social Research and University College London. The first found that British employers hire foreigners because they are more productive than the natives; the second that recent European immigrants pay £8.8 billion more in tax than they consume in public services. Employ more industrious foreigners, and growth will rise, the deficit shrink and taxes fall.
This may not be a popular prescription, but such reports are hardly going against the grain. Earlier this year, the OECD suggested that the deficit would be up to £16 billion larger if we relied on home-grown workers alone. The Office for Budget Responsibility predicts that if immigration falls dramatically, the public finances will face a £65 billion black hole because of lost tax revenues. And the Treasury puts 0.25 percentage point of GDP growth down to immigration.
Part of the economic upside is obvious: those who leave their country to labour in ours are inclined to work hard. As for talent, why would employers bother to hire them if they didn’t have skills we need?
Demographics are at play, too. Foreigners who come to work tend to be young, and Britain needs young people, because our elderly are living longer and we are having fewer children. So importing healthy folk who pay taxes and make few calls on the NHS and the state pension makes sound fiscal sense.
This is, however, time-limited. Young immigrants will become old immigrants. Some will return home, but others will settle and start consuming more services than they pay for, just like the natives. The UCL study suggests that immigrants who arrived in the Eighties and Nineties, then stayed and had children, now pay in only 85p for every £1 of services they consume.
Cold economic logic suggests we could simply import more young foreigners to support the older ones. But that puts relentless pressure on the population, and on public services. Yes, a bigger population means a bigger economy. But as the House of Lords Select Committee on Economic Affairs noted in 2008 – in a report which found “no evidence” that immigration had significant economic benefits – what matters is not GDP, but GDP per capita. There’s no point baking a bigger cake only to cut it into more slices.
Here, despite the Lords’ verdict, the evidence remains cloudy. A paper from the US last year analysing 147 countries found a “robust, positive effect of openness to immigration on long-run income per capita”. But many experts say this is far from conclusive, suggesting we give them a few more years to crunch the numbers.
Economists may not be certain about immigration, but that won’t stop politicians competing to echo what they firmly believe are voters’ concerns. And in the rush to pander, complex economic debates are almost inevitably overlooked in favour of suspiciously neat answers.
Perhaps the best example came at the 2010 election, when the Tories promised to reduce net immigration to the “tens of thousands”, a target the Coalition has not formally adopted (the Lib Dems said no) and may well miss anyway: it’s currently more than 170,000 a year.
Leaving aside the daftness of targeting net immigration (which could be done by driving more Brits into retirement on the Costa del Sol), the message was clear: immigration is bad and reducing it good. Labour has fallen in line, promising (yet another) new law to cut net immigration.
Yet privately, some senior Tories now worry that the pledge was too crude, reinforcing the notion of “immigrants” as a homogenous mass and obscuring the fact that some really do benefit the economy. Hence David Cameron and George Osborne’s recent visits to India and China, to tell people that if they have money or talent, there is no limit on their ability to come to Britain to learn or invest. Hence, too, Theresa May’s announcement today of a “VIP” visa service for wealthy foreign businessmen.
The Prime Minister knows that some immigration is positive: in his “global race”, Britain must woo international talent or fall behind. He won’t budge from the “tens of thousands” target – but he, like all politicians, will eventually have to accept that the costs, benefits and consequences of immigration are too complicated and important to be squeezed into trite slogans and simplistic promises.
They’ll resist, of course, fearful of upsetting an electorate they think is deaf to arguments for a more sophisticated approach. But they might give a moment’s thought to a recent YouGov poll which found that, while people do think immigration drives down wages for the low-paid, more think it has been good for the economy than bad – and even more believe the NHS would collapse without it. Whatever the conclusions of the great immigration debate, perhaps the most important is that the voters are usually far more intelligent, and open-minded, than the politicians give them credit for.
James Kirkup is the Telegraph’s Political Editor.