Blog Post

Questionable immigration claims in the Brexit white paper

The UK government's white paper on Brexit suggested that the EU's "free movement of people" has made it impossible to control immigration. This seems to rest on an assumption that EU citizens can "move and reside freely" in any member state. Zsolt Darvas finds these arguments problematic, and points out that it is difficult to infer public opinion about immigration from the referendum result.

By: Date: February 8, 2017 Topic: European Macroeconomics & Governance

Immigration to the UK was a key issue in the Brexit debate and has also received a great deal of attention since the referendum. According to the recent white paper from the UK Government on Brexit principles, control of immigration will be a key priority.

Point 5.3 of the white paper states that “It is simply not possible to control immigration overall when there is unlimited free movement of people to the UK from the EU”, suggesting that EU mobility rules were responsible for the surge in immigration and the UK did not have a control.

I find this claim potentially misleading, for two reasons:

  1. By respecting all EU rules, net immigration of non-British citizens to the UK could have been cut by a stunning 82% in 2004-11 and also rather significantly since then. It was a UK decision not to control immigration.
  2. EU rules allow unlimited free movement of people only for a duration up to three months. For longer periods, only workers, the very rich and students can stay in another EU country.

Let me elaborate on these two points and then draw lessons for future UK immigration policies.

UK decisions have led to the surge in immigration since the mid-1990s, not the EU’s labour mobility principle

The striking message of Figure 1 is that the bulk of immigrants to the UK since 1991 arrived from outside the EU.

Note: Figure 1 replicates Chart 5.1 of the white paper in a colourful way for better readability.

On average, in 2004-11, 71% of non-British immigrants arrived from outside the EU. Their ratio was still as high as 65% in 2012 and 52% on average in 2013-15. No EU rule forced the UK to admit so many non-EU citizens: it was a UK decision.

In these figures we should distinguish asylum seekers, who were allowed to enter the UK on humanitarian grounds. On average in 2004-11, asylum seekers accounted for 5% of non-British immigrants, while their share was 7% in 2013-15. Thereby, if the UK was interested in mitigating the inflow of people from non-EU countries beyond asylum seekers, UK authorities could have cut immigration by 66% in 2004-11 and 45% in 2013-15.

Certainly, in the event of temporary immigration restrictions on EU8 nationals in 2004-11 by the UK, citizens of these countries could have come to the UK after the end of the seven-year period. However, most likely, many of those EU8 citizens who actually immigrated to the UK in 2004-11 would have immigrated to other EU15 countries and settled there and therefore the imposition of seven-year temporary controls by the UK would have likely reduced total immigration from these countries significantly.

Moreover, the accession treaties with new EU member states allowed a transition period of up to  seven years, during which older EU member states had the option to maintain immigration restrictions on the citizens of newer member states. They also had the option to introduce such controls during the seven-year transition period, even if they have abolished the restrictions earlier, provided that there was a serious disturbance on their labour markets.

Twelve of the fifteen other older EU member states used this option and adopted temporary immigration controls, but the UK, Ireland and Sweden opened their labour markets directly from 1 May 2004 for nationals of the eight central European countries (EU8) that joined the EU on 1 May 2004. Furthermore, the UK did not introduce controls later in the 7-year transition period, when immigration from these countries sharply increased. Immigration from EU8 accounted for on average 16% of non-British net immigration in 2004-11.

Therefore, even when respecting all EU rules, 2004-11 net immigration of non-British citizens to the UK could have been cut by a stunning 82% (71% non-EU minus 5% asylum seekers plus 16% EU8). But UK authorities decided not to do that.

The UK Government’s white paper does not even mention these facts, but seems to blame EU mobility rules for the surge in net immigration since the mid-1990s. This is simply incorrect.

In my view, there are various possible reasons why the UK government allowed immigration to increase from the mid-1990. These include both economic and political factors.

Firstly, these immigrants brought major economic benefits to the UK, which is also recognised by the white paper (see points 5.2, 5.5, 5.6, 5.7 and 5.8). I also wrote a post on this issue before the Brexit referendum. Political reasons could include a desire to support and welcome citizens of Commonwealth countries (who accounted for about half of non-EU immigration). There might also have been a recognition of Western European countries’ historical responsibility to re-unite the continent after the disastrous decades of communism in Central Europe. Or perhaps the UK wanted to show a “pro-European” face.

EU free mobility rules do not allow unlimited establishment of residency in other EU countries

The sentence I quoted from the white paper at the start of my blogpost talks about “unlimited free movement of people to the UK from the EU”. There is also a box on page 28 explaining EU’s mobility rules, which concludes: “The Free Movement Directive[15] sets out the rights of EU citizens and their family members to move and reside freely within the territory of the EU. This Directive replaced most of the previous European legislation facilitating the migration of the economically active and it consolidated the rights of EU citizens and their family members to move and reside freely within the territory of the EU.

These statements greatly exaggerate the options available to EU citizens and are therefore potentially misleading. EU mobility rules, as set out in the Free Movement Directive, continue to focus on mobility of workers.

There is indeed unlimited free movement of tourists, and any citizen of an EU country can stay in another EU country for a period of three months without conditions.

However, a citizen of an EU country can stay in another EU country for more than three months only in three cases:

  1. If she/he finds a job (becomes employed or self-employed), or
  2. If she/he and accompanying family have sufficient resources and sickness insurance and do not become a burden on the social assistance system of the host member state, or
  3. If she/he has a student status and sufficient resources to cover living expenses and sickness insurance.

New jobseekers have a slightly more preferential treatment. Following European Court of Justice rulings, they can stay up to six (and not three) months. However, a six-month period is not that long and after six months host country authorities can ask the jobseeker to leave if she/he cannot prove to have a realistic chance of finding work there (see here). Host country authorities can also expel the jobseeker, although this cannot be an automatic process and all relevant circumstances have to be considered.

Therefore, the free residency right can be exercised unconditionally only for a period up to three months, for jobseekers up to six months. But only workers (and their family members), students and the very rich who do not rely on the social assistance system of the host country can stay for longer. Permanent residency is acquired only after a continuous period of five years legal residency according to the conditions described above.

These EU rules have important implications for a possible surge in immigration prior to Brexit:

The UK should not worry that much about a possible surge in immigration from EU countries prior to Brexit

Even if immigration from EU countries surges before Brexit, it is unlikely that those who come in excess of regular immigration patterns would find a job. There is a natural rate of job creation. Therefore, those new immigrants who are not able to find a job will become unauthorised after six months, and if they do not leave voluntarily, the UK will have to right to expel them.

What to conclude for the new UK immigration system after Brexit?

The economic reasons for allowing immigration to increase from the mid-1990 prevail. When labour shortages arise, authorities can either allow foreign nationals to enter, or to create tensions in the labour market and cut economic growth, which would have negative feedback effects on UK public finances and taxes paid by British citizens.

The ‘Global Britain’ vision of Prime Minister Theresa May involves attracting foreign investment, which will come with people. For example, when a US financial conglomerate establishes an office in the City of London, it will bring many employees from abroad. When a Japanese manufacturer establishes a factory in the UK, it will again bring many workers. In the age of digitalisation, IT investments will require more and more IT experts from India and other parts of the world, simply because there are not enough within the UK.

The next question is the immigration control mandate UK authorities received from the Brexit referendum. It is difficult to infer public opinion about immigration and what kind of control the majority of UK nationals would like to see. We only know that the share of leave votes at the Brexit referendum was actually lower in areas where there are more immigrants (Figure 2). This suggests that voters in areas where there are more immigrants were more in favour of EU-membership and possibly of the free labour mobility principle which comes with it.

Note: the dots represent the 133 NUTS3 regions of England, while the line shows the regression line. The same relationship holds within Wales, Scotland and Northern Ireland.

Sources: The Electoral Commission and Office for National Statistics (see detailed data sources in the annex here).

Figure 2

There are compelling economic reasons in favour of immigration, and the Brexit referendum gave an ambiguous message about the UK’s future immigration policy. I therefore suggest that the UK should not introduce an overly tight immigration control system.

This post is partly based on my testimony at the House of Lords EU committee on UK-EU immigration issues on 18 January 2017. I thank Inês Goncalves Raposo for her great help in my preparation for the testimony.


Republishing and referencing

Bruegel considers itself a public good and takes no institutional standpoint. Anyone is free to republish and/or quote this post without prior consent. Please provide a full reference, clearly stating Bruegel and the relevant author as the source, and include a prominent hyperlink to the original post.

View comments
Read about event More on this topic

Past Event

Past Event

EU - CELAC Economic Forum - Channels for a joint future

On 11 October Bruegel together with GIGA and Real Instituto Elcano will organise a conference on relations between the EU and the Community of Latin American and Caribbean States.

Speakers: Paola Amadei, Angel Badillo, Paulo Carreño King, Linda Corugedo Steneberg, Gonzalo de Castro, Gonzalo Gutiérrez, Bert Hoffmann, Edita Hrdá, Ramón Jáuregui, Emilio Lamo de Espinosa, Eduardo Levy Yeyati, Gabriel Lopez, Enrique Medina Malo, Maryleana Méndez Jiménez, Luicy Pedroza, Mario Pezzini, Mario Soares, Everton Vargas, Dylan Vernon and Guntram B. Wolff Topic: Global Economics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: October 11, 2017
Read article

Blog Post

India’s trade ties with the UK and EU

As EU and Indian leaders meet in Delhi, we look at the figures on trade. The UK’s place in the relationship warrants special attention. EU-India trade has more than tripled since 2000, but UK-India trade is largely static. The shift is especially noticeable for EU exports to India, where the UK share has dropped from 29% to 10%.

By: Maria Demertzis and Alexander Roth Topic: European Macroeconomics & Governance, Global Economics & Governance Date: October 6, 2017
Read article More on this topic More by this author

Blog Post

Long-term growth potential, or dead in the long run?

By linking growth with both employment and the imperative for India to hold its own with China for strategic autonomy, Prime Minister Modi has brought sustainable, high quality, inclusive economic growth to the centre of political discussion, which is where it rightfully belongs.

By: Suman Bery Topic: Global Economics & Governance Date: October 5, 2017
Read about event More on this topic

Past Event

Past Event

Crowd Employment

This event aims to discuss the various nuances and diversity that characterize crowd employment.

Speakers: Cristiano Codagnone, Valerio Michele De Stefano, Irene Mandl, Georgios Petropoulos and Amit Singh Topic: Innovation & Competition Policy Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: October 5, 2017
Read article More on this topic

Blog Post

Employment in Europe and the US: the EU’s remarkable strength

The common narrative that the US labour market outperforms the EU is not as trustworthy as overall unemployment figures imply. There is a complex interaction between job creation, labour force participation and unemployment. Jobseekers leaving the labour market altogether was an important factor behind the reduction in US unemployment, while Europe’s job growth has been accompanied by increased labour force participation.

By: Zsolt Darvas and David Pichler Topic: Global Economics & Governance Date: September 28, 2017
Read article More on this topic

Blog Post

Can roaming be saved after Brexit?

The referendum where UK voters chose to exit the European Union has many unanticipated consequences. One that is gaining visibility in the UK just now is the impact of Brexit on mobile roaming arrangements. How might the UK maintain roaming arrangements with the EU in the event of a hard Brexit?

By: J. Scott Marcus and Robert G. Clarke Topic: Innovation & Competition Policy Date: September 21, 2017
Read article Download PDF More by this author

Policy Contribution

Dutch Senate

Europe’s fourfold union: Updating the 2012 vision

The depiction of the euro area/European Union (EU) as a ‘fourfold union’ emerged in the first half of 2012 at the height of the euro-area crisis. In the past half-decade, Europe’s financial union has been significantly strengthened but remains incomplete and is challenged by Brexit. No consensus has been found on fiscal union and economic union has not made material progress, but political union might have advanced further than many observers realize.

By: Nicolas Véron Topic: Dutch Senate, European Macroeconomics & Governance, Finance & Financial Regulation, Testimonies Date: September 21, 2017
Read article Download PDF More by this author

Blueprint

Remaking Europe: the new manufacturing as an engine for growth

Europe needs to know how it can realise the potential for industrial rejuvenation. How well are European firms responding to the new opportunities for growth, and in which global value chains are they developing these new activities? The policy discussion on the future of manufacturing requires an understanding of the changing role of manufacturing in Europe’s growth agenda.

By: Reinhilde Veugelers Topic: Innovation & Competition Policy Date: September 7, 2017
Read article More on this topic More by this author

Blog Post

EU posted workers: separating fact and fiction

After President Macron’s recent tour of Central and Eastern European countries, EU posted workers are getting a lot of attention. However, a major reform of the system is already underway and we should not confuse posted workers with long-term labour migrants. Posted workers are a small part of the labour force, and their labour market impact is likely to be minor.

By: Uuriintuya Batsaikhan Topic: European Macroeconomics & Governance Date: August 31, 2017
Read article Download PDF More by this author

Parliamentary Testimony

European Parliament

Could revising the posted workers directive improve social conditions?

This presentation was delivered in Brussels on 31 January 2017 at a hearing of think-tanks, to advise the European Parliament on the revision of the Posting of Workers Directive.

By: Zsolt Darvas Topic: European Macroeconomics & Governance, European Parliament, Testimonies Date: August 29, 2017
Read about event More on this topic

Past Event

Past Event

Perspectives on Universal Basic Income

At this event, we discussed the possible benefits but also the possible disadvantages of Universal Basic Income.

Speakers: Grégory Claeys, Olli Kangas, Professor Philippe Van Parijs and Prof. Dr. Hilmar Schneider Topic: European Macroeconomics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: July 12, 2017
Read article Download PDF More on this topic

External Publication

Review of EU-third country cooperation on policies falling within the ITRE domain in relation to Brexit

What is the possible future relationship between the EU and the UK in light of Brexit? The report provides a critical assessment of the implications of existing models of cooperation between third countries and the European Union on energy, electronic communications, research policy and small business policy.

By: J. Scott Marcus, Georgios Petropoulos, André Sapir, Simone Tagliapietra, Alessio Terzi, Reinhilde Veugelers and Georg Zachmann Topic: European Macroeconomics & Governance Date: July 5, 2017
Load more posts