Controversial immigration rules are dividing opinion — and families

Thousands of families stand to be torn apart as a power struggle rages on between the UK government and courts.

In the latest conflict between the coalition and the judges, over 15,000 families face being separated by government policy.

The Home Office is appealing this summer’s High Court judgment, which found new immigration rules on partners and children joining their families in the UK breach basic human rights.

Last month (5 July), three families won a judicial review of new immigration rules which required British citizens and refugees to earn at least £18,600 if they want to bring a non-European partner into the UK, rising to £22,400 if a partner and child are coming, plus £2,400 for each additional child.

Justice Blake ruled that the new earnings threshold was not unlawful] in itself, but it was a ‘disproportionate’ interference with the right to a family life at the level it was set, especially as it was combined with other onerous rules. For example, the requirement that applicants must have at least £16,000 in the bank if they want to use savings to supplement an income less than the £18,600 threshold.

Justice Blake suggested a lower threshold of £13,500, which would be less likely to penalise young couples, and he also proposed taking into account the earnings of the incoming partner, who may well be the main breadwinner.

The ruling culminated months of campaigning by separated families, human rights lawyers and MPs and came hot on the tails of a June report by the All-Party Parliamentary Group on Migration, which called for an independent review of the rules in light of “emerging evidence about what must be the unintended consequences” - including, it said, the cost to the public purse.

Yet the government remains adamant that the new rules are fair and economically sound and has launched an appeal against the High Court ruling. Earlier this month, House of Lords whip Lord Taylor of Holbeach sent a letter to peers defending the measures.

Lord Taylor insisted that a Middlesex University study which found that preventing 17,800 partners coming to work in the UK would cost £850million in lost economic activity over 10 years, did not include costs such as welfare, health and education.  Lord Taylor argued that the net benefit of the income threshold barrier to family immigration will be £660m to the taxpayer over the next decade.

“The aims of the income threshold are to ensure that family migrants are supported at a reasonable level so that they do not become a burden on the taxpayer and they can participate sufficiently in everyday life to facilitate their integration in British society,” maintained Lord Taylor. 

What is clear is that thousands of husbands, wives, fathers and mothers will suffer separation from their families under such rules.

The £18,600 figure came from advice by the UK Border Agency’s Migration Advisory Committee. Their November 2011 report suggested that 45 per cent of the 37,600 visas issued to migrants joining their spouse or partner that year would fail to meet an £18,600 income threshold. But the Committee warned that its advice was based on economic considerations alone, with no reference to wider legal, social or moral issues. Furthermore, it noted that its calculations relied on various assumptions and generalisations.

So just how arbitrary is the £18,600 income barrier to bring a loved one who may be earning more than you to the UK? It’s certainly far above the £12,875 minimum wage earnings for a 40 hour week.

But as usual, we have a government that says it is determined not to let the courts dictate public policy — even though the High Court’s judicial review in July was not overturning Home Office rules, just suggesting a few sensible amendments to make these family rules more workable and help comply with human rights.

The government’s intransigence suggests it fears discrimination or human rights claims if it loses the appeal.

Meanwhile the cost of these wranglings add up, as does the human cost of couples divided and children growing up not knowing their fathers.

Once again human rights, in this case the right to a family life, is the battle ground for an ugly squabble between government and the courts.

The Home Office is appealing this summer’s High Court judgment on the new immigration rules. Photo: Getty

Vanessa Ganguin is a partner at Laura Devine Solicitors. She is an immigration specialist and heads the firm’s human rights and appeals team.

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Let's turn RBS into a bank for the public interest

A tarnished symbol of global finance could be remade as a network of local banks. 

The Royal Bank of Scotland has now been losing money for nine consecutive years. Today’s announcement of a further £7bn yearly loss at the publicly-owned bank is just the latest evidence that RBS is essentially unsellable. The difference this time is that the Government seems finally to have accepted that fact.

Up until now, the government had been reluctant to intervene in the running of the business, instead insisting that it will be sold back to the private sector when the time is right. But these losses come just a week after the government announced that it is abandoning plans to sell Williams & Glynn – an RBS subsidiary which has over 300 branches and £22bn of customer deposits.

After a series of expensive delays and a lack of buyer interest, the government now plans to retain Williams & Glynn within the RBS group and instead attempt to boost competition in the business lending market by granting smaller "challenger banks" access to RBS’s branch infrastructure. It also plans to provide funding to encourage small businesses to switch their accounts away from RBS.

As a major public asset, RBS should be used to help achieve wider objectives. Improving how the banking sector serves small businesses should be the top priority, and it is good to see the government start to move in this direction. But to make the most of RBS, they should be going much further.

The public stake in RBS gives us a unique opportunity to create new banking institutions that will genuinely put the interests of the UK’s small businesses first. The New Economics Foundation has proposed turning RBS into a network of local banks with a public interest mandate to serve their local area, lend to small businesses and provide universal access to banking services. If the government is serious about rebalancing the economy and meeting the needs of those who feel left behind, this is the path they should take with RBS.

Small and medium sized enterprises are the lifeblood of the UK economy, and they depend on banking services to fund investment and provide a safe place to store money. For centuries a healthy relationship between businesses and banks has been a cornerstone of UK prosperity.

However, in recent decades this relationship has broken down. Small businesses have repeatedly fallen victim to exploitative practice by the big banks, including the the mis-selling of loans and instances of deliberate asset stripping. Affected business owners have not only lost their livelihoods due to the stress of their treatment at the hands of these banks, but have also experienced family break-ups and deteriorating physical and mental health. Others have been made homeless or bankrupt.

Meanwhile, many businesses struggle to get access to the finance they need to grow and expand. Small firms have always had trouble accessing finance, but in recent decades this problem has intensified as the UK banking sector has come to be dominated by a handful of large, universal, shareholder-owned banks.

Without a focus on specific geographical areas or social objectives, these banks choose to lend to the most profitable activities, and lending to local businesses tends to be less profitable than other activities such as mortgage lending and lending to other financial institutions.

The result is that since the mid-1980s the share of lending going to non-financial businesses has been falling rapidly. Today, lending to small and medium sized businesses accounts for just 4 per cent of bank lending.

Of the relatively small amount of business lending that does occur in the UK, most is heavily concentrated in London and surrounding areas. The UK’s homogenous and highly concentrated banking sector is therefore hampering economic development, starving communities of investment and making regional imbalances worse.

The government’s plans to encourage business customers to switch away from RBS to another bank will not do much to solve this problem. With the market dominated by a small number of large shareholder-owned banks who all behave in similar ways (and who have been hit by repeated scandals), businesses do not have any real choice.

If the government were to go further and turn RBS into a network of local banks, it would be a vital first step in regenerating disenfranchised communities, rebalancing the UK’s economy and staving off any economic downturn that may be on the horizon. Evidence shows that geographically limited stakeholder banks direct a much greater proportion of their capital towards lending in the real economy. By only investing in their local area, these banks help create and retain wealth regionally rather than making existing geographic imbalances worce.

Big, deep challenges require big, deep solutions. It’s time for the government to make banking work for small businesses once again.

Laurie Macfarlane is an economist at the New Economics Foundation