Why Tories ought to hate the immigrant health tax

Another week, another bad week to be an immigrant in the UK. With the addition of this so-called preventative measure against "health tourism", the government has put a huge sign on the door of Britain saying foreigners aren't welcome.

This week's knee-jerk policy to appease our grandparents is a £200 a year added to the cost of non-EU migrants visas to cover the costs of their healthcare when inside the UK. Jeremy Hunt, the Tory Minister responsible for the bill, claims this will prevent an epidemic of "health tourism". You'd think Hunt would be more sympathetic to the plight of foreigners likely to need medical care, given his well known love of Australian octogenarian visitors.

That's one of the many ironies of the policy, of course. While it's designed and marketed as dealing with some kind of incredibly rare edge case - someone like Bimbo Ayelebola, the Nigerian single mum of quintuplets, the bulk of the people who will end up paying it are the New York lawyer, the Australian student, the Indian entrepreneur - the kind of immigrants who in theory, we want. As usual with this sort of measure, the largely imaginary people it's designed to stop either won't pay it, or will pay the small levy and be health tourists anyway  - £200 looks pretty cheap compared to the average hospital bill.

It also doesn't do anything to stop the kind of low skilled migration that does apparently worry people on doorsteps and keeps Nigel Farage on Question Time, because a huge amount of that sort of migration comes through the EU, or is illegal anyway.

I mean, obviously, the policy is incredibly stupid on its own terms, even before you go into the maths - in 2011-2012 the NHS spent £33m on treating foreign nationals, of which around £21m was recovered (through directly charging them or via health insurance). The remaining £12m as a proportion of the £109bn NHS budget is almost negligible. It will be interesting to see how this ahem, "giant" £12m subsidy to foreigners can be reconciled with the costs of administering it, not to mention the added costs of untreated foreign nationals walking around with potentially infectious diseases. Still, I suppose Jeremy Hunt can avoid getting TB by hiding in a bush. Of course, it could be designed as a revenue raising exercise in the first place, as there are as many as five million people living here who it will affect.

Earning an extra £200 per person probably sounds pretty tempting, and in theory, it'll pull support from UKIP, and that is probably what motivated the announcement in the first place. My question is, why should these people pay extra? The most ludicrous part of this whole package of measures is that it's predicated on the notion that these foreigners aren't paying their way. Of course, the vast bulk of non-EU foreigners who live in the UK are here on work visas - so they of course pay tax, national insurance, all the rest of it. 

On that note, here's an email I recently received:

Dear friends, family and colleagues, 

As many of you will know, I married Kristina last month, who I met when we were both students at the National Film and Television School. We love each other and want to spend our lives together. 

We both wanted to start out in our respective careers (animation and cinematography) in the UK, but are now coming up against the misguided, cruel and fundamentally stupid new visa rules for the husbands and wives of British citizens. Kristina, who is from the US, may very well be forced to leave the country before 21st April, when her student visa expires - in a week's time - because we don't meet the new financial threshold, which is three times higher than it was before July 2012.

Under the current rules, introduced last July, 47% of employed British citizens would not be able to keep a non-EU spouse in the UK. It's affecting thousands of people, but they are a small part of overall immigration. The government seems to be pandering to extremists by pledging to reduce immigration, and the stringent new rules in the area of marital visas are an attempt to make a small reduction in the figures any which way they can, given the fact that most immigration is from the EU, which they cannot control. Non-EU immigrants have always had their visas stamped 'no recourse to public funds', so the government's argument about wanting to reduce the burden on the state makes no sense. 

But something more fundamental is wrong here: the government is effectively saying that I only really had the right to marry a British or EU citizen, since as it stands, I seem to be penalized for marrying someone of a non-European nationality. Marriage rights have been stratified, plain and simple, and by being under a certain income threshold people are being treated as second class citizens.  

It's a common story - so much for the value of traditional marriage, eh?

While that's all important - and hopefully enough that this silly idea won't survive the eight-week consultation it's due to go through - the thing that strikes me about this policy is how much business leaders hate it. It's the cherry on top of the vast sundae of the other anti-immigration measures that have been proposed and implemented in the last few years - everything from Cleggbonds, to language requirements, to rules about how much people's spouses have to be earning in order to qualify for marital residency. 

Indeed, if you go to most businesses, and ask them for the one supply side reform they'd like, they won't tell they'd like to be able to sack people more easily, or wish they could pay less than the minimum wage, they'll tell you they'd like to make it easier to hire foreigners. Currently, most businesses will reject non-EU nationals as soon as they hear they need a visa because it's too much red tape to sponsor an application. Even if people are willing to put up with the uncertainty of the hire based on a bureaucrat's say-so, then usually firms will only want to go through the shocking incompetence of the UK border authority once.

Even if you can find a firm willing to sponsor you, the fees for the individuals fees are enormous - £600 every six months is not uncommon, especially if you have to renew your contract regularly. £200 a year on top of that perhaps doesn't sound like much to millionaire Jeremy Hunt, and people are bandying around phrases like "it's only £16 a month", but it's not like there's an easy direct debit option to spread your payments. An £800 upfront cost for a Visa, plus a bundle of other red tape, is enough to put off exactly the sort of people we want - skilled, hard-working valuable migrants, like students who have studied here who want to stay on. 

Anyway, as you can see, individually, these measures might almost make sense to your great aunt who "just thinks Britain isn't British anymore". But taken together, they add up to a huge sign on the door of Britain saying foreigners aren't welcome, and they only hurt the kind of law-abiding, hard working migrants the average over 60 on the doorstep professes to like. This is a huge problem - turning the cold shoulder to migrants is costing us billions, and pulling hugely skilled individuals out of the economy. It's about time all those politicians who bang on about kickstarting growth through supply side reform come out from under their rocks and make the case for the benefits of immigration. 

Look, no hands! Health Secretary Jeremy Hunt. Photograph: Getty Images

Willard Foxton is a card-carrying Tory, and in his spare time a freelance television producer, who makes current affairs films for the BBC and Channel 4. Find him on Twitter as @WillardFoxton.

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BHS is Theresa May’s big chance to reform capitalism – she’d better take it

Almost everyone is disgusted by the tale of BHS. 

Back in 2013, Theresa May gave a speech that might yet prove significant. In it, she declared: “Believing in free markets doesn’t mean we believe that anything goes.”

Capitalism wasn’t perfect, she continued: 

“Where it’s manifestly failing, where it’s losing public support, where it’s not helping to provide opportunity for all, we have to reform it.”

Three years on and just days into her premiership, May has the chance to be a reformist, thanks to one hell of an example of failing capitalism – BHS. 

The report from the Work and Pensions select committee was damning. Philip Green, the business tycoon, bought BHS and took more out than he put in. In a difficult environment, and without new investment, it began to bleed money. Green’s prize became a liability, and by 2014 he was desperate to get rid of it. He found a willing buyer, Paul Sutton, but the buyer had previously been convicted of fraud. So he sold it to Sutton’s former driver instead, for a quid. Yes, you read that right. He sold it to a crook’s driver for a quid.

This might all sound like a ludicrous but entertaining deal, if it wasn’t for the thousands of hapless BHS workers involved. One year later, the business collapsed, along with their job prospects. Not only that, but Green’s lack of attention to the pension fund meant their dreams of a comfortable retirement were now in jeopardy. 

The report called BHS “the unacceptable face of capitalism”. It concluded: 

"The truth is that a large proportion of those who have got rich or richer off the back of BHS are to blame. Sir Philip Green, Dominic Chappell and their respective directors, advisers and hangers-on are all culpable. 

“The tragedy is that those who have lost out are the ordinary employees and pensioners.”

May appears to agree. Her spokeswoman told journalists the PM would “look carefully” at policies to tackle “corporate irresponsibility”. 

She should take the opportunity.

Attempts to reshape capitalism are almost always blunted in practice. Corporations can make threats of their own. Think of Google’s sweetheart tax deals, banks’ excessive pay. Each time politicians tried to clamp down, there were threats of moving overseas. If the economy weakens in response to Brexit, the power to call the shots should tip more towards these companies. 

But this time, there will be few defenders of the BHS approach.

Firstly, the report's revelations about corporate governance damage many well-known brands, which are tarnished by association. Financial services firms will be just as keen as the public to avoid another BHS. Simon Walker, director general of the Institute of Directors, said that the circumstances of the collapse of BHS were “a blight on the reputation of British business”.

Secondly, the pensions issue will not go away. Neglected by Green until it was too late, the £571m hole in the BHS pension finances is extreme. But Tom McPhail from pensions firm Hargreaves Lansdown has warned there are thousands of other defined benefit schemes struggling with deficits. In the light of BHS, May has an opportunity to take an otherwise dusty issue – protections for workplace pensions - and place it top of the agenda. 

Thirdly, the BHS scandal is wreathed in the kind of opaque company structures loathed by voters on the left and right alike. The report found the Green family used private, offshore companies to direct the flow of money away from BHS, which made it in turn hard to investigate. The report stated: “These arrangements were designed to reduce tax bills. They have also had the effect of reducing levels of corporate transparency.”

BHS may have failed as a company, but its demise has succeeded in uniting the left and right. Trade unionists want more protection for workers; City boys are worried about their reputation; patriots mourn the death of a proud British company. May has a mandate to clean up capitalism - she should seize it.