IMMIGRATION/BREXIT

BUSINESS leaders have clashed with the Government over Brexit following the pledge by Theresa May to curb the flow of cheap, low-skilled labour from Europe.

Business lobby groups reacted with fury to leaked Government proposals outlining a tough new immigration system after Britain leaves the EU.

Downing Street hit back, saying business needs to end its reliance on cheap migrant labour and do more to train British workers. Mrs May said ministers had a duty to curb immigration after last year’s EU referendum, and restated her pledge to slash net immigration to the “tens of thousands”.

But the Government was in disarray as Cabinet ministers, including Home Secretary Amber Rudd, Chancellor Philip Hammond and Business Secretary Greg Clark are understood to have concerns about slashing immigration from the EU too quickly.

Damian Green, the First Secretary of State and one of Mrs May’s closest allies, is also thought to have misgivings, and believes the plan can be toned down.

It has also emerged that FTSE 100 leaders have refused to sign a letter backing the Government’s Brexit strategy. Downing Street quietly asked executives to sign an open letter saying they wanted to “make a success of Brexit”, and welcoming the Government’s push for a transitional deal.

But this was not welcomed by some, with one executive reportedly saying: “There is no way we could sign this given the current state of chaos surrounding the talks.”

It is understood the letter, drafted by No. 10, was due to be made public as Mrs May tries to create support for the legislation going through Parliament about our EU withdrawal.

The row followed the leak of a Home Office document setting out plans to curb immigration from the EU after Brexit.

The Prime Minister said: “Immigration has been good for the UK, but people want to see it controlled as a result of our leaving the EU.

“The Government continues to believe it is important to have net migration at sustainable levels, particularly given the impact it has on people at the lower end of the income scale in depressing their wages.”

Defence Secretary Sir Michael Fallon said: “We have always welcomed to this country those who can make a contribution to our economy, people with high skills.

“On the other hand, we want British companies to do more to train up British workers, to do more to improve skills of those who leave our colleges. So, there’s always a balance to be struck. We’re not closing the door on all future immigration but it has to be managed properly and people do expect to see the numbers coming down.”

The document, which has caused uneasiness among some ministers, suggests low-skilled workers from the EU would only be allowed to stay for a year or two, and EU citizens would be barred from moving to the UK to look for a job. Ministers are also considering a ‘direct numerical cap’ on the numbers who come here from Europe after the UK leaves in March 2019.

Big businesses reacted angrily to the proposals. The chief executive of the British Hospitality Association said the proposals would be “catastrophic” for the industry, one which relies heavily on cheap EU labour.

The executive said: “We understand the wish to reduce immigration but we need to tread carefully and be aware of the unintended consequences – some businesses will fail, taking UK jobs with them.”

A spokesperson for the Confederation of British Industry, said: “An open approach to our closest trading partners is vital for business, as it attracts investment to the UK. It also helps keep our economy moving by addressing key labour shortages.”

The Institute of Directors said business leaders would not welcome the proposals and its members would be hoping for changes in the Government’s final position.

The National Farmers’ Union said a cut in migrant workers could cause “massive disruption” for the industry. Its deputy president said 80,000 seasonal workers a year are needed “to plant, pick, grade and pack over 9 million tonnes of fruit, vegetable and flower crops”.

But Migration Watch, a think-tank, said ministers were right to pressure businesses to wean themselves off cheap foreign labour.

In a statement, it said: “We want to encourage employers to train local people and make more of an effort to prepare for a time when there won’t be all these people coming in with readymade skills prepared to work for lower wages.”

The leaked document was a draft of proposals due to be published this autumn.

Sources said a further six drafts have since been produced and it has not yet gone to ministers for approval. Senior figures in Brussels raised concerns about the document.

Gianni Pittella, leader of a large group within the European Parliament, said it revealed the “nasty side of Theresa May’s Government”, adding: “Should the British Government follow the position outlined, it will certainly not help the negotiations. It adds uncertainty and confusion.”

German MEP Elmar Brok, an ally of Angela Merkel, said he was “shocked by the language and content of this paper”, adding: “I think we are in a situation that EU citizens are seen as an enemy for the UK. This is not an atmosphere where you can find solutions.”

. How other countries control their borders

In the United States immigration law provides for an annual worldwide limit of 675,000 newcomers, with certain exceptions for close family members.

The Immigration and Naturalisation Act allows a foreign national to work and live lawfully and permanently in the States.

Each year it admits foreign citizens on a temporary basis. Annually, Congress and the president also determine a separate number for admitting refugees.

Immigration to the States is based upon the following principles: the reunification of families, admitting immigrants with skills that are valuable to the US economy, protecting refugees and promoting diversity. In Australia, a tough immigration points system is credited with keeping numbers under control while ensuring the economy has the skills it needs.

Extra points are given for factors such as experience, qualifications and age. But critics argue there is no guarantee it would bring numbers down, pointing out that Australia has proportionately higher immigration than the UK.

Since 1967, most immigrants to Canada have been admitted on purely economic grounds. Each applicant is evaluated on a nine-point system that ignores their race, religion and ethnicity and instead looks at age, education, skills, language ability and other attributes.