Are the Tories set to ditch their immigration cap?

Coalition announces review of unworkable policy.

It looks as if the Tories may finally have realised that their plan to impose a cap on immigration from outside the EU is neither desirable nor workable.

Today's Financial Times reports that the policy is under review, amid new evidence that it will damage the British economy and provoke a cabinet revolt.

George Osborne's new budgetary watchdog, the Office for Budget Reponsibility (OBR), recently cut its forecast for "trend growth" from 2.75 per cent to 2 per cent from 2014 onwards, primarily because it fears Britain's labour force will not be large enough to sustain it. The conclusion was clear: we need more babies or more immigrants.

At the same time, the OBR warned that Cameron may fail to meet his long-standing promise to "reduce net migration to tens of thousands not hundreds of thousands", a level not seen since the days of the Major government.

Immigration fell significantly during the recession (see chart), but net migration of 163,000 in 2008 indicates that Cameron would need to cut immigration by at least 38 per cent to bring the total to less than 100,000. Privately, Tories speak of an even more unrealistic target of 50,000.

Net migration chart

Cameron's promise remains unfeasible for several reasons. For a start, the government cannot limit immigration from within the EU without restricting the free movement of labour and throwing the UK's continued membership into doubt.

Cameron's policy also ignores the 39,000 people who come to the UK on spousal visas after marrying British citizens abroad.

For now, it seems the cap will be "modified" rather than abandoned, but this is still a good time to have the argument all over again.

Special subscription offer: Get 12 issues for £12 plus a free copy of Andy Beckett's "When the Lights Went Out".

George Eaton is political editor of the New Statesman.

Getty
Show Hide image

Labour must unite idealists and nativists to beat Ukip

The party has no coherent economic policy, says Labour donor John Mills. 

The heart of the dilemma faced by Labour is that, by and large, its working-class supporters think that you should look after your own first and everyone else afterwards, while its more idealistic middle-class supporters don’t share these nativist views. Add to this the fact that the Labour party nowadays is more middle class, more internationalist, more public sector-orientated, more metropolitan, more intellectual and less interested in winning elections than it has ever been before, and you can see why Ukip is a huge potential threat.

Ukip started by attracting mainly disaffected Conservative voters who thought their party was weak on the EU and who didn’t like David Cameron’s liberal approach to social issues. More recently, especially during the EU referendum, Ukip picked up a huge amount of Labour support. Of the 9.3m people who voted Labour in the 2015 general election, close to 3.5m of them voted for Leave – and half of these people say they are not going to vote Labour in future. Where are they going to go?

The crucial issue is whether Ukip, having gone through all its recent traumas, will get its act together to scoop up these footloose voters. Up to now, the glue which has held Ukip together has been hostility to the EU and distrust of the political establishment. It has lacked coherent policy. This leaves Ukip still essentially a protest operation rather than as a potentially governing party. But this could change. 

With Labour now increasingly idealistic rather than nativist, Ukip may pull together a string of policies that promise support for working-class solidarity, immigration restrictions, social conservatism and a reindustrialisation plan – very much the platform which won Donald Trump the US presidency. Such a manifesto could attract sufficiently widespread working-class support to make large numbers of Labour seats vulnerable. Ukip came second in 120 constituencies during the 2015 general election. There doesn’t have to be a very large swing for Ukip to start picking up enough seats to make the prospect of a future Labour government more and more remote.

Faced with this prospect, what can Labour do? Three key strategies suggest themselves. One is to avoid alienating potential Labour supporters by trying to persuade them that they should have voted Remain. On the contrary, the party must clearly accept the referendum result, and fight hard and constructively towards getting the best possible Brexit deal. 

Second, Ukip is weak on economic policy. It is all very well to promise reindustrialisation and better jobs, but how is Ukip going to fulfil them? Populism shades very easily into protectionism. There is a principled case for open markets to produce more prosperity - but this may only be possible if there are also changes to monetary and exchange rate policy to avoid unmanageable commercial competition. Ukip may, like the Labour party, find this a hard case to make.

Third, Labour needs to change its tone. There needs to be less talk of abstract universal values and more of concrete steps to improve people’s lives. Labour must celebrate working-class attitudes to self-help, trade unionism, mutual support, patriotism and solidarity. The party must build on the huge influx of members, not least because they are the cadres for the future, but it also must avoid alienating old supporters with many years of experience and commitment. It is up to the party leadership to create such a change.

As it stands, too many Labour people are still trying to derail Brexit. The party has no coherent economic policy and it still looks too London-centric, divorced from its working-class roots. Not a good place to be if Ukip pulls itself together. 

John Mills is a businessman and a Labour donor. He founded the group Labour Leave ahead of the EU referendum and has recently published the pamphlet "Why Trump Won"