London to see biggest hit from new immigration system

London is expected to see the biggest impact from proposed changes to the UK’s immigration system, the influential MAC report has warned.

Published this morning, the Migration Advisory Committee has set out a twin-pronged approach for the government to build its post-Brexit framework, deploying a combination of an Australian-style points-based system with a salary threshold reduced to £26,500.

The MAC recommended that the skills base for roles that come under the threshold be broadened out to include “medium” level skills, such as those relied upon by the construction sector, but not “low” skills, such as waiters and waitresses.

The recommendations would reduce levels of immigration and the total GDP, although there would be a “very slight” increase to GDP per capita, productivity and public finances.

Presenting the report, outgoing MAC chair professor Alan Manning said it would be a more “relaxed” system for most migrants although it would be more restrictive for EU migrants.

Given the number of EU migrants living in London, the capital will see the brunt of the impact, he said.

“The estimated impacts of our recommendations also vary across the regions … with the largest predicted impacts in London, driven by the larger share of migrants living and working there.”

If the proposals in it had been implemented in 2004, when Poland and other Eastern European countries joined the EU, it would have led to a 3.3 per cent drop in London’s GDP over that period.

But Manning stressed that overall the impact would be minimal, and there would be “no big bang”, going so far as to suggest the points-based system was little more than a soundbite.

“It’s the way it’s presented, and we are interested in the substance,” he said, although added that presentation was important politically.

*story by City A. M.