Cameron sells Britain to the Indians

The PM softens his stance on immigration to encourage more skilled migrants from the subcontinent.

David Cameron has used a trip to India to promote British universities to potential applicants, assuring workers at Hindustan Unilever that there is "no limit" on the number of Indian students who can come to Britain. The promise is, however, conditional on a basic English qualification and the offer of a place.

The announcement is merely a restatement of existing policy, but underscores the difficulty the government is having reconciling two opposing aims.

On the one hand, it is trying to reduce immigration to the UK. Problematically, the target it has set itself — reducing net migration to below 100,000 people per year — is one it can't really affect directly. Around a third of net migration to the UK is made up of EU citizens, whose freedom of movement cannot legally be impaired. The most recent statistics available show a net inward migration of 76,000 EU citizens, against a total net migration of 166,000 people.

Similarly, one of the biggest downward pressures in net migration to the UK is emigration of British citizens. 151,000 British citizens left the UK in the year ending March 2012, and just 73,000 arrived in the same year. For opponents of migration who genuinely believe Britain is "full", encouraging British emigration may be a sensible proposal to reduce net migration; but for those with more nebulous concerns about "culture clashes", it's the last thing they would want.

Those intractable sources of migration increase the pressure for the government to use the only policy levers it does have: those affecting migration from non-EU countries. That is why, for instance, the Home Office launched an actual war on marriage on Valentine's day, arresting people in the registry office for "sham" marriages:



(Presumably those who thought same sex marriage was an assault on the institution will be speaking up about this literal assault shortly)

Similar pressure has been brought to bear on businesses wanting to hand out visas for work, and on students wanting to come to Britain to study. Even the American director of economics at Oxford University's Smith School finds himself at the behest of a British regime which is less than welcoming, prompting a letter to the Financial Times calling on David Cameron to "make good on the recent promise you made at Davos that 'Britain is back open for business'."

The problem is that, even as these last few avenues by which the government can control the rate of migration are squeezed as tightly as they can be, the economic situation is also making it painfully clear that they should be as wide-open as possible.

The only economic argument against immigration which holds any water is that low-skilled migration may depress the wages of the worst off in Britain, even as it boosts output overall. Such an argument leaves open the question of why the proper response to that isn't redistribution rather than restriction (as well as the more philosophical question of why it's valid to value some people's quality of life over others' based just on where they happened to be born), but even taken at face value, it says nothing about the virtues of restricting "high skilled" immigration.

And so, faced with a rather urgent need to boost the productive capacity of Britain, Cameron has started emphasising that latter aim. No longer is he telling potential overseas students "don't come here, it's cold and wet and you probably won't get any face-to-face teaching anyway"; instead, the UK as a source of high-quality learning and potential business investment gets touted on an overseas trip.

(There is also, of course, the fact that an influx of overseas students will do much to tide over the funding crisis in UK universities, as those students are some of the few who pay more than their education costs).

So don't be fooled into thinking that a mere "restatement" of policy is no new news. If it really does indicate the Government shifting its priorities from ensuring that "Britain is closed" to finally using immigration policy to boost the economy, it could be the biggest story of the week.

David Cameron travels on the Dehli Metro during his last visit, in 2006. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Is anyone prepared to solve the NHS funding crisis?

As long as the political taboo on raising taxes endures, the service will be in financial peril. 

It has long been clear that the NHS is in financial ill-health. But today's figures, conveniently delayed until after the Conservative conference, are still stunningly bad. The service ran a deficit of £930m between April and June (greater than the £820m recorded for the whole of the 2014/15 financial year) and is on course for a shortfall of at least £2bn this year - its worst position for a generation. 

Though often described as having been shielded from austerity, owing to its ring-fenced budget, the NHS is enduring the toughest spending settlement in its history. Since 1950, health spending has grown at an average annual rate of 4 per cent, but over the last parliament it rose by just 0.5 per cent. An ageing population, rising treatment costs and the social care crisis all mean that the NHS has to run merely to stand still. The Tories have pledged to provide £10bn more for the service but this still leaves £20bn of efficiency savings required. 

Speculation is now turning to whether George Osborne will provide an emergency injection of funds in the Autumn Statement on 25 November. But the long-term question is whether anyone is prepared to offer a sustainable solution to the crisis. Health experts argue that only a rise in general taxation (income tax, VAT, national insurance), patient charges or a hypothecated "health tax" will secure the future of a universal, high-quality service. But the political taboo against increasing taxes on all but the richest means no politician has ventured into this territory. Shadow health secretary Heidi Alexander has today called for the government to "find money urgently to get through the coming winter months". But the bigger question is whether, under Jeremy Corbyn, Labour is prepared to go beyond sticking-plaster solutions. 

George Eaton is political editor of the New Statesman.