Only a fiver now - but what long-term cost?
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Immigrants help UK PLC - whatever Labour says

Miliband is acquiescing in a rightward-shift in political rhetoric on immigration.

“We were wrong not to ensure there were maximum transitional controls when new countries joined the European Union in 2004,” Ed Miliband says. “We won’t make that mistake in future.”

Get it? Labour is saying sorry for its record on immigration. As with those notorious mugs, its motivation – to undermine Conservative and Ukip claims that it is weak on immigration – is obvious.

To Miliband, “the reason we were wrong is that working people were seeing dramatic changes in their communities that were not planned or properly prepared for.” The government was lamentably unprepared for immigration from the eight new members of the EU - it predicted net inflow of 13,000 a year, when over four times that number came. But consider this: had transition controls been imposed on new EU members in in 2004 Brits today would today face higher taxes, worse-funded public services, a higher national debt or, most likely, a toxic cocktail of all three.

Between 2001 and 2011, European arrivals contributed a net £20 billion to UK PLCAnd the crux: immigrants from the ten countries that joined the EU in 2004 – the same ones who Miliband expresses regret at Labour not imposing migration controls on – contributed a net of £5 billion to the economy. Really the figure is even higher - £10 billion, the report reckons - because the costs of armed forces, defence and government do not rise in proportion to a bigger population. So a larger population means more people to spread the costs around.

It has become conventional wisdom that not imposing transition controls was folly. And certainly more could have been done to improve infrastructure and public services in areas in which immigration was greatest. But this failure does not mean that allowing immigrants from new members of the EU was a mistake. Labour's decision to be one of three EU countries, along with Ireland and Sweden, that did not impose transition controls meant that the UK was ideally placed to attract the most skilled workers of the new EU members. And the notion that EU migration is singularly responsible for driving down working-class wages is nonsense: the squeeze on working-class ages is about decades of technological change and globalisation, not whether Poles did not have to wait seven years before being free to work in the UK. The National Institute of Economic and Social Research have found that the 2004 influx to Britain depressed real wages over the long run by 0.36 per cent. Clamping down on immigration is fool's gold that will not help the native British working-class; improving education and skills would. 

The unfashionable truth is that the UK now needs immigrants more than ever. An Office of Budget Responsibility report two years ago bluntly spelled out the choice facing the UK. All other things being equal, the OBR predicted that high net migration would result in public sector net debt at 73% of GDP by 2062-3. With zero net migration it would double, to 145%, compared to 79.1% today. This is because immigrants are hard-working – those who arrived since 2000 have been 43% less likely than natives to receive state benefits or tax credits – highly educated and are more likely to be of working age than the native British population. It is no coincidence that as the Conservatives have moved ever further away from their pledge to reduce net migration beyond 100,000 – the most recent annual figure for net migration was a cool 298,000 – so growth has returned to the economy, nor that the economy is doing best in the capital, where immigration is highest. You can have a “clampdown” on immigration or you can have economic growth – but no one has worked out how to have both.

Parts of Labour's immigration policy - especially the emphasis on increasing and strengtehning the minimum wage and an increase in border staff - are shrewd. But the failure to challenge myths about the impact of EU migrants ultimately means that Labour has acquiesced in a rightward shift on immigration. The party has bought into the notion that immigration is inherently a problem, regardless of its economic effects; taken to its logical conclusion, such thinking leads inexorably to Brexit.

Failing to challenge the status quo on immigration has seemed expedient. But Labour has stored up trouble for its next government: it will be compelled to act on immigration, even if economic damage is the result. Ukip could come second in close to one hundred Labour seats in the north, and would love nothing more than a Prime Minister Miliband over-promising but under-delivering on immigration.

Tim Wigmore is a contributing writer to the New Statesman and the author of Second XI: Cricket In Its Outposts.

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The problems with ending encryption to fight terrorism

Forcing tech firms to create a "backdoor" to access messages would be a gift to cyber-hackers.

The UK has endured its worst terrorist atrocity since 7 July 2005 and the threat level has been raised to "critical" for the first time in a decade. Though election campaigning has been suspended, the debate over potential new powers has already begun.

Today's Sun reports that the Conservatives will seek to force technology companies to hand over encrypted messages to the police and security services. The new Technical Capability Notices were proposed by Amber Rudd following the Westminster terrorist attack and a month-long consultation closed last week. A Tory minister told the Sun: "We will do this as soon as we can after the election, as long as we get back in. The level of threat clearly proves there is no more time to waste now. The social media companies have been laughing in our faces for too long."

Put that way, the plan sounds reasonable (orders would be approved by the home secretary and a senior judge). But there are irrefutable problems. Encryption means tech firms such as WhatsApp and Apple can't simply "hand over" suspect messages - they can't access them at all. The technology is designed precisely so that conversations are genuinely private (unless a suspect's device is obtained or hacked into). Were companies to create an encryption "backdoor", as the government proposes, they would also create new opportunities for criminals and cyberhackers (as in the case of the recent NHS attack).

Ian Levy, the technical director of the National Cyber Security, told the New Statesman's Will Dunn earlier this year: "Nobody in this organisation or our parent organisation will ever ask for a 'back door' in a large-scale encryption system, because it's dumb."

But there is a more profound problem: once created, a technology cannot be uninvented. Should large tech firms end encryption, terrorists will merely turn to other, lesser-known platforms. The only means of barring UK citizens from using the service would be a Chinese-style "great firewall", cutting Britain off from the rest of the internet. In 2015, before entering the cabinet, Brexit Secretary David Davis warned of ending encryption: "Such a move would have had devastating consequences for all financial transactions and online commerce, not to mention the security of all personal data. Its consequences for the City do not bear thinking about."

Labour's manifesto pledged to "provide our security agencies with the resources and the powers they need to protect our country and keep us all safe." But added: "We will also ensure that such powers do not weaken our individual rights or civil liberties". The Liberal Democrats have vowed to "oppose Conservative attempts to undermine encryption."

But with a large Conservative majority inevitable, according to polls, ministers will be confident of winning parliamentary support for the plan. Only a rebellion led by Davis-esque liberals is likely to stop them.

George Eaton is political editor of the New Statesman.

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