My Lords, it is a pleasure to follow my noble friend Lord Foster, who raised serious questions about the ETA and whether there will be an impact. He provided evidence to show that having an ETA at the current level, before any increases, is already having an impact. One of the general themes I will cover is what the impact assessment does not say about the impact on businesses, including tourism in this case, and other areas that I will come to. This is yet another charge that has gone up, adding to overheads, and it is becoming a problem in certain sectors.
It is also a pleasure to follow the noble Lord, Lord Rowlands, who outlined many of the problems that the Secondary Legislation Scrutiny Committee has been reporting on over the years. I look forward to the Minister’s response to his questions.
I will start on an optimistic note, given our debate on the previous SI. The Secondary Legislation Scrutiny Committee does not often hand out commendations in its reports, but it has commended the Minister and his officials on the Explanatory Memorandum, which was very helpful. With my calculator out, I did a lot of calculations and, although Minister may be irritated by some of the questions he gets, it is actually because we understand what is happening. That needs to be to be credited because we have not necessarily been able to give that credit in the past. The impact assessment was helpful, but I am not sure that it asked the right people about the impact. I will come back to that in a second.
Paragraph 29 of the Secondary Legislation Scrutiny Committee’s 16th report says that
“the net benefit of the changes is relatively small. Further, we note that in some scenarios set out in”
the impact assessment,
“the costs of the changes outweigh the benefits. This possibility arises because … it is ‘highly uncertain’ what goods and services visitors and visa-holders consume, and how many of those are provided”
by British businesses. Can the Minister comment further on this, or is the impact assessment just guesswork? That is the perhaps slightly unfair approach to trying to translate what the Secondary Legislation Scrutiny Committee said.
I say that because the maxima level set here is, pretty broadly, a 7% increase. I very much echo the comments made by my noble friend; the Government have made it very plain that when they do introduce fee rises—as opposed to setting a new maxima—most of them will go up to the new maxima. As the impact assessment says, the Government are trying to ensure that they can cover the costs of migration and the staffing for that, but I am concerned because 7% seems high.
For example, the pension triple lock is increasing by 4% this year. Many felt that was too high in the current financial circumstances. I am not going to comment on that but am trying to weigh it up as 7% seems to be a general increase, if not for the next year. I know the Minister will say it is only a maxima, but we heard elsewhere that there is an intention in most cases to go to that.
It is true that in paragraph 5.2, the EM says:
“The department is seeking to implement changes to fees to generate additional income from end users to support the funding of the migration and borders system and reduce reliance on funding from the taxpayer”.
However, the increases that are not 7% are the ones that really worry me. They seem bizarre and, in one particular case, ill thought through. For example, the skilled worker and temporary worker fees have both been increased by over 100%: from £239 to a £525 maxima for the skilled worker fee and from £25 to £55 for the temporary worker maxima. The reality is that in just over seven months, this Government have increased other costs to businesses—not Home Office costs, I grant you—but it is difficult and tedious for employers to recruit staff from overseas at the moment. I am not commenting on whether it was right or wrong, but the previous Government really tightened down on who could come to work here. Part of that was to start increasing substantially the costs that businesses and individuals coming here had to pay.
One of the costs I am particularly concerned about—we have just had a vote on this and there will be more before the evening is done—is on the increase to employers’ national insurance contributions. Not only are these increasing, but the floor for payment is lowered to include many lower-paid workers. Migrant workers filling gaps in our economy, such as in social care, hospices, agriculture and hospitality, are much more likely to be in those sectors where the margins for businesses are extremely low.
Our social care sector is already in complete crisis. Only today, there are reports of care at home being removed and clients being told they will have to leave their home and move into care homes, solely because of the economics of the increased national insurance contributions and the high costs associated with care delivered in a home setting. To have extra fees for migrant workers—often paid for by the businesses because the migrant workers just do not have their own resources—is going to add further to those sectoral problems. I wonder why the impact assessment says there are no financial implications from a 100% increase in these fees.
If these increases are as set out in paragraph 5.2 of the EM, did the Home Office actually seek advice from some of the sectors most reliant on overseas workers, whether skilled or temporary? I am slightly less worried about the very high-value skilled workers, where an employer will not only take on somebody at a high salary but be prepared to manage an oncost. It is those who are given temporary leave to work here, or in the health sector, where we know they have been granted.
Finally, paragraph 5.10 sets out the increase for the review of a decision related to immigration and nationality. The main fee maxima is increased by 7% and I have already commented on that. Hidden a few lines further down is a really shocking increase from £80 to £480 for an administrative review of a decision. This is nothing to do with the relevance of costs and I wonder if it is a financial punishment. An administrative review is very different to a review by a panel or senior officer, as referred to earlier in that section. Can the Minister explain why this particular administrative review has now hit the same maxima level as the much more complex and personnel-intensive level required under the main type of panel review?
By the way, it is interesting to note that, at paragraph 11.1, that particular increase has not been highlighted, whereas others have. I wonder why that might happen. The reason why the noble Lord, Lord Rowlands, my noble friend Lord Foster and I are raising these issues is to try to understand the strategy behind these increases, as opposed to just a reason to raise money. We are concerned that at least some of them may backfire and stop the increase in growth that this Government are keen to see.