Econ_Sep_22

52 Britain

The Economist

September 22nd 2018

one day and not the next.”

Tighter controls on low-skilled mi-

grants are the flip side of the

MAC

’s propos-

al. It recommends ending nearly all such

immigration, arguing that low-skilled jobs

could be done by Britons or by migrants

who come for the purpose of family re-

union. (A seasonal workers’ scheme could

bail out agriculture, it suggests.)

Some industries predictably squealed

at this. The Freight Transport Association,

whose members employ migrants as driv-

ers, warned that “next-day deliveries

would soon be a thing of the past.” Yet

such companies might be forced to invest

more in labour-saving technologies, en-

hancing their workers’ productivity. And

having large numbers of businesses en-

gaged in low-wage, low-productivity activ-

ities may not represent the best use of Brit-

ain’s capital. Industries that have benefited

from low-skilled migration are “not neces-

sarily the parts of the

economy that we

want to be growing,” notedAlanManning,

the

MAC

’s chairman.

The idea of treating

and non-

mi-

grants equally seems to alignwith the gov-

ernment’s thinking. Sajid Javid, the home

secretary, has indicated that he would like

to harmonise

and non-

migration

after Brexit. Theresa May, the prime minis-

ter, has said she would like “a set of rules

for people from the European Union and

people fromoutside the EuropeanUnion.”

The Labour Party also backed the

MAC

’s

proposals, calling for an “end to discrimi-

nation” against non-

migrants.

Yet as the

MAC

itself repeatedly empha-

sises, its economic analysis takes no ac-

count of the political considerations that

surround immigration. The most obvious

concerns the Brexit negotiations. The

would prefer to maintain the free move-

ment of people between it and Britain,

since its citizens are the clearest beneficia-

ries of the current system. In return forpref-

erential access, it might bewilling to offer a

better trade deal, as well as the reciprocal

right for unskilled or retired Britons to live

andwork in the

The same principle applies to other

countries with which Britain hopes to

strike trade deals after Brexit. India has

made clear that it wants freer migration to

be a component of any trade agreement.

Last year the thenAustralian high commis-

sioner suggested that he expected “greater

access for Australian businesspeople” as

part of the price of a deal.

Mrs May could stick to her guns and in-

sist that immigration policy must be strict-

ly nationality-neutral. In isolation, that

might lead to “modest” improvements

over the current set-up, as the

MAC

argues.

Yet it would greatly limit the scope of fu-

ture trade agreements, not just with the

but far beyond. Not for the first time, Brit-

ain must reckon with the fact that taking

back control comes at a cost.

Migration in Europe

How to bend the rules

HERESAMAY’S government has long

insisted that freemovement of people

from the EuropeanUnion to Britainmust

end after Brexit. Commentary on this

week’sMigration AdvisoryCommittee

(

MAC

) report has focused on its advice

that Britain should not offer

citizens

preferential terms after it leaves. Yet the

report pointedly adds that “preferential

access to the

labourmarket would be

of benefit to

citizens”. This clearly

hints that a regime favouring

migrants

could be a bargaining chip towin better

access to the

’s singlemarket.

The principle of getting free trade in

return for freemovement is implicit in

the singlemarket’s rules. As amatter of

economics, a singlemarket could be built

around the freemovement of goods,

services and capital. But the

deliber-

ately adds freemovement of people,

whichmost citizens outside Britain see as

a benefit of the club.

Yet it also permits exceptions. Harvey

Redgrave of the Tony Blair Institute, a

think-tank, notes that other

countries

have long been amazed that, given Brit-

ain’s hostility to

migration, its govern-

ment has never applied the constraints

allowed on freemovement. It was one of

only three countries not to limit the

migration of nationals fromcentral and

eastern European countries for the first

fewyears after they joined the

2004. Even today it ismore generous than

it need be. In June Britain chose not to

extend limits on freemovement from

Croatia, which joined the

in 2013, for

twomore years.

Britain is also in aminority in having

no registration system for

migrants.

Post-Brexit, it could use such a system, as

Belgiumdoes, to throwout migrants who

have no job after sixmonths. Denmark

and Austria limit migrants’ ability to buy

homes in some places.

Most

countries are also tougher

than Britain in insisting that welfare

benefits cannot be claimed until ami-

grant builds up some years’ worth of

contributions. Equally, the

’s posted-

workers directive is used bymany to try

to stop any undercutting of local labour

markets. But Britain is lax in enforcing

both itsminimumwage and its standards

forworking conditions.

Non-

countries in the European

Economic Area have other options. Liech-

tenstein, a tiny principality, has quotas on

migrants, despite being a full member

of the singlemarket. Article 112 of the

EEA

treaty allows Iceland andNorway to

invoke an “emergency brake”, although

they have never used it. And non-

EEA

Switzerland, which is in the singlemarket

for goods, not only limits property pur-

chases but alsomakesmost employers

offer jobs to Swiss nationals first.

This particular concessionwas se-

cured after the

refused to accept a

Swiss vote in 2014 to set limits on free

movement. Yet a further referendumon

the issue is now threatened, so Brussels

may have to bend its rules yet again. All

this comes as other

countries besides

Britain are looking for newways to con-

strain the freemovement of people.

The

MAC

report itself points to the

irony that all this is happening as

migration to Britain is going down fast. It

notes that the countrymay be ending free

movement just as public concern about it

is falling. It is not too late for a compro-

mise inwhich Britain accepts something

like freemovement in principle, but

heavily constrains it in practice.

ManyEuropean countries interpret freemovementmore loosely thanBritain