House of Commons - International Development

Select Committee on International Development Written Evidence

Memorandum submitted by Professor Richard Black[33] Director, Development Research Centre on Migration, Globalisation and Poverty and Co-Director, Sussex Centre for Migration Research

MAKING MIGRATION MORE "DEVELOPMENT-FRIENDLY": TEMPORARY MOBILITY SCHEMES

BACKGROUND

The principle of expanding temporary worker schemes is problematic for many on both the left and right of the political spectrum. For those who oppose immigration, temporary worker schemes represent a way in which permanent immigration is opened up "through the back door", since those who arrive temporarily often find ways to stay longer. In contrast, for those who support more open immigration, and believe that immigrants have much to contribute to the UK economy, temporary worker schemes may appear too restrictive—since they may rely on coercion to ensure return and therefore be completely temporary. At the same time, by effectively shifting some of the costs of social reproduction—such as education, training, and social care—on to countries of origin, they could be seen as exploitative of these countries welfare systems, and/or unfair competition to domestic UK labour.

However, the point remains that there is both demand for workers in the UK—in both skilled and unskilled occupations—and considerable demand for employment in developing countries—again amongst both the skilled and unskilled. Innovative ways urgently need to be found to bring together these two demands, but importantly for this to be done on a basis of more equality in terms of the interests and objectives of the UK and sending countries.

This note responds to a request from International Development Committee members during oral evidence on 6 January 2004, to expand on how existing UK schemes for legal immigration could be "made more coherent and particularly more consistent with our development objectives." Since making this comment, I have been made aware of an unpublished paper by Catherine Barber of Oxfam, which has been supplied to the Committee.[34] This note responds in part to the proposals outlined in this thoughtful and original paper, but adopts a broader and less proscriptive approach to options that might be considered. The thoughts set out are preliminary and designed to provoke discussion and debate.

EXISTING TEMPORARY WORKER SCHEMES

Since coming to office, the Labour government has expanded some existing channels for temporary mobility to the UK, as well as opening up new channels (Table 1). Temporary worker schemes have been preferred over general relaxation of immigration rules as they allow specific labour market demands in the UK to be met in the short-term, without making a longer-term commitments, and in a way that in principle reassures the UK electorate that the government retains control over immigration. Both UK employers, and those able to obtain temporary work permits, can be seen to gain from such schemes.

These schemes include areas of both skilled and unskilled work, and have been introduced primarily in response to demand for workers in the UK. For example, critical shortages have been faced in recent years not only in sectors such as health (doctors, nurses) and education (teachers) but also for farm workers, and in the hotel, catering and fish farming sectors, to name just a few. Labour shortages have also been highlighted in the food processing and canning industries.[35] However, for this reason, the rules introduced reflect UK labour market and political concerns, and have not, on the whole, been designed around sectors where other countries have workers who wish to migrate. In this sense, they have they not been designed to fit with the development priorities of sending countries, even though this could have been a consideration in their design. In addition, significant barriers exist that prevent many poor people accessing these schemes, notably in the form of fees charged either for visas or by unscrupulous agents who control access to the recruitment process.

Table 1

EXISTING TEMPORARY WORKER SCHEMES IN THE UK, 2004


Scheme	Total number admitted (2002-03)	Development of scheme	Main areas of origin in developing world

General work permit scheme	137,488[36]	Numbers have doubled since 1997	India (10,000), South Africa (9,000), Philippines (7,000), Afghanistan (5,000)
Working holidaymakers	40,000[37]	Extension to whole Commonwealth and removal of employment restrictions	No information available, but thought to be predominantly "old" commonwealth
Seasonal agricultural workers scheme (SAWS)	22,800	Existing scheme doubled in size since 2000	Ex-USSR (especially Ukraine), Poland, Bulgaria, Lithuania Romania, Slovakia
Sectors Based Scheme (SBS)	13,000[38]	New programme launched in 2003	Ukraine, Poland, Slovakia, Czech Republic
Highly Skilled Migrant Programme (HSMP)	4,384[39]	New programme launched in 2002	No information available, but thought to be dominated by northern countries
Domestic workers	14,000[40]	On-going scheme	Worldwide?
Au pairs[41]	60,000[42]	Expansion of existing scheme to non-EU countries	Most from EU, but scheme now available also in other designated countries, including Bosnia, Croatia, Slovak Republic, Slovenia and Turkey

TEMPORARY WORKER SCHEMES AND INTERNATIONAL DEVELOPMENT

There are four main ways in which the UK's temporary worker schemes might impact on development, and specifically the UK's commitment to pro-poor development.

First, it is clear that migration represents a potential livelihood strategy for people in poor countries. In this context, the creation of additional places on temporary worker schemes may provide opportunities for a direct positive impact on development and/or poverty reduction as workers earn more money, although this will depend on how schemes are organised, and who has access to them. If only the relatively wealthy have access, the schemes may contribute to increasing inequality. Meanwhile, potential development benefits will also depend on the extent to which migrants are encouraged to use their earnings in a way that contributes to development in their home country.

Second, international migration also often carries risks and vulnerabilities for migrants. The conditions under which people move may be harsh, working conditions for migrant workers are often poor or indeed exploitative, and migrant workers often enter into debt in order to migrate in the first place, leaving them unable or unwilling to demand basic employment rights, and highly vulnerable in the event of unemployment or sickness. These risks are generally more pronounced in the context of irregular flows. In this context, the expansion of legal temporary worker schemes could contribute to reducing the risks and vulnerabilities faced by migrant workers.

Third, migration has an impact not only on the UK labour market, but also on the labour market of the home country. This may be positive, by relieving unemployment, or promoting positive social or technological change, but it may also displace labour shortages from the UK to the sending country. For example, in key public services of relevance to poor people, notably the health and education sectors, as well as more widely in skilled occupations where the training of replacement workers may be costly or time consuming, filling labour shortages in the UK almost certainly will create labour shortages in the sending country.

In addition, almost by definition, temporary worker schemes recruit workers to the UK labour market only at a productive stage of their working lives, often leaving the costs of childcare, education, health, and care of the elderly to their country of origin. Yet, since these workers pay tax and National Insurance in the UK, rather than their country of origin, the cost of social care is not necessarily covered, leaving these sectors in countries of origin relatively impoverished.

CATHERINE BARBER'S PROPOSALS TO MAKE TEMPORARY WORKER SCHEMES MORE "DEVELOPMENT-FRIENDLY"

Catherine Barber's paper focuses primarily on the first two sets of concerns listed above, namely the generation of income by migrants, and the risks and vulnerabilities they face. Barber outlines how additional schemes for unskilled workers similar to the Seasonal Agricultural Workers Scheme (SAWS) could be designed to maximise the development potential of earnings by participating workers (as well as the political acceptability of such schemes to different stakeholders), whilst minimising the risks involved for potential migrants. Specifically, she proposes:

— A small number of new targeted bilateral recruitment programmes administered by the International Organisation for Migration (IOM), designed to eliminate exploitation in the recruitment process, and provide a fair and transparent basis for recruitment. It is suggested these might be concluded in particular with Central and Eastern European countries that are not accession states to the EU.

— A mandatory savings scheme for workers coming to the UK on such schemes, in which 20% of earnings over £107 per week, plus all National Insurance contributions (NIC), should be placed in an account in the migrant's home country, to be made available to the migrant only on their return to the home country.

— Return assistance targeted at providing information on investment opportunities, access to credit, and advice on management and technical issues.

A model for new, organised, bilateral recruitment is a Spanish-Ecuadorian scheme cited by Barber,[43] which is seen as having cut out unscrupulous middlemen who put migrants at risk, and building an efficient and transparent mechanism for recruiting workers. In turn, voluntary assisted return programmes are already operated in the UK by IOM[44], though currently targeted at asylum-seekers and failed asylum-seekers, and not providing the specific forms of assistance envisaged by Barber. Meanwhile, mandatory savings schemes are also already in operation—for example by companies recruiting foreign workers in countries such as Taiwan[45]. Indeed, the principle of a mandatory savings scheme already exists in the UK for some migrant workers from the Baltic states who work on short (three months) contracts in the hotel industry. However, in this case, the workers receive board and lodging whilst in the UK on a contract negotiated with a company that provides a group of workers, and all of the rest of their salary is paid in local currency into the home bank account. This practice is of concern to UK trades unions, as it is seen as breaching basic human rights, whilst also representing a loophole to circumvent minimum wage legislation.[46]

In addition, Barber considers, but rejects the notion that temporary mobility schemes should involve an element of training in the UK. In principle, such a combination of work and training is already available in the UK through relaxation of rules on part-time employment for those entering the UK on study visas, and the expectation of language learning for schemes such as those for temporary agricultural workers and au pairs. However, Barber argues that to extend such training more generally to temporary workers would be too expensive for UK employers or the UK government to pay for it, particularly given the fact that such workers are often already over-qualified for the jobs they are doing, and would certainly be more expensive than funding training in countries of origin.

WAYS FORWARD

Some concerns might be raised in relation to specific elements of the package of measures proposed by Barber. For example, justification for the compulsory element of any mandatory savings scheme would need to be demonstrated in relation to the benefits to the wider sending country society or economy, which would need to outweigh the infringement of individual liberty. Many human rights groups and trades unions might question whether such a justification could ever be made. Indeed, there was international outcry at a 1983 decree by President Marcos in the Philippines that required Filipino workers to remit 50-70% of their earnings, and for all remittances to be sent through formal banking channels,[47] and this was subsequently repealed through successful Filipino migrant protests and NGO advocacy campaigns.[48] Meanwhile, the history of organised recruitment of labour is not always one of transparency or fairness even where public bodies or governments manage the process,[49] with criticisms of their large bureaucratic burden, incentives to corruption and lack of cost-effectiveness.[50] Return schemes, including those that involve the provision of technical assistance, have also often received less than glowing evaluations.

Whilst not ruling out consideration of the above approaches, I would suggest a more basic application of principles in the development of new (or modification of existing) temporary mobility schemes, that might enhance their development-friendliness:

1. Wider consultation with stakeholders

A wider degree of consultation on any proposed changes to temporary mobility arrangements would be likely to enhance the potential for these to have outcomes of benefit to developing countries, and to the achievement of the UK government's development targets. For example, it appears that the sector-based scheme developed for the food processing industry, although it met a labour market need in the UK, has not been particularly successful in attracting large numbers of applicants. Consultation with overseas stakeholders could help both to refine areas in which sector based schemes are developed, and to publicise them once they are in place.

Key stakeholders who should be consulted might include:

— DFID;

— Stakeholders involved in preparation of PRSPs or Participatory Poverty Assessments (PPAs) in sending countries, as part of a process of ensuring consistency between migration and anti-poverty agendas;

— Major UK development agencies working in migrants' countries of origin;

— Significant community organisations that represent the interests of overseas migrant workers.

Each of these stakeholders may have a perspective on the areas or sectors in which schemes would be valuable, the terms and conditions that might be applied, and the way that schemes might operate.

2. Exploration of incentives for temporary workers to invest in development or poverty reduction

Without accepting the principle of mandatory savings schemes, a variety of incentives might be envisaged that would encourage migrant workers to invest in businesses (or indeed in education or health) during their stay and/or after their return. These measures could be specifically linked to managed temporary mobility schemes, providing an incentive also to migrants to wait for spaces on these schemes (rather than travelling illegally), and comply with the rules.[52] Such incentives might include:

— Access to dedicated training or advice for returnees under the scheme (as proposed by Barber);

— Preferential interest rates on savings lodged in approved home country accounts, but which could only be realised if return took place within the rules of the scheme;

— Matched investment from the UK government in approved business initiatives, health insurance or charitable contributions (including schools) made by temporary migrants, again paid after a return in compliance with the rule of the scheme.

Incentives could also be targeted depending on the type of migration involved; for example, where schemes involve less-skilled migration, a legitimate objective might be to extend reach and access to banking services, whereas with more highly-skilled migrants, there may be more emphasis placed on encouraging productive investment in pro-poor development in their home country, without infringing basic liberties in relation to savings or investment decisions. A focus on supporting pro-poor investment by skilled migrants would help to address the objection to matched funding of migrant remittances on the grounds that international migrants are not usually poor, or the poorest, themselves.

At the same time, to the extent that basic services for migrants (health, education) continue to be provided in the country of origin if migration is truly temporary, further consideration could be given to the legitimacy of some form of "tax" on migrant earnings. Here, migrants are likely to be most concerned that they have some way to hold governments accountable for the way such tax income is spent, as well as seeking to avoid paying tax twice, in both sending and receiving country, without having access to double the level of services.

3. Development of codes of conduct for recruitment agencies

A possible half-way house between the promotion of new temporary mobility schemes organised in a "top-down" manner by IOM or a similar organisation, and the current laissez-faire attitude to recruitment of workers, measures could be introduced for more strict regulation of private recruitment agencies involved in temporary mobility schemes. Indeed, there is already some renewed appetite for this amongst some politicians and the trades unions following the terrible events in Morecambe Bay in early February 2004.

The standard for such codes of conduct should be high, and include transparent fee structures, involvement of migrant workers" associations in recruitment, and rigorous enforcement of minimum wage and other health and safety conditions in the workplace. Such codes could moreover act as a model for the dissemination of good practice not only for recruitment of labour to the UK, but for labour mobility more generally, by giving regulated recruitment agencies preferential access to good quality legal immigration routes to the UK. Such agencies could also be integrated into consultation on new schemes as envisaged in (1) above.

In practice, such a code already exists for recruitment of medical and nursing personnel by UK health authorities, the "Code of Practice on International Recruitment", established in October 2001, and currently under revision. Like earlier guidance on international recruitment issued in 1999, the principle applied is that recruitment should only be undertaken "where it will have no adverse effect upon the recruit's home healthcare system".[53] This aspiration is supported by a list of prescribed countries, from which the DoH is committed not to recruit doctors or nurses without prior approval from the home country government, although the code currently only applies to recruitment by English health authorities, and does not cover the private sector. The latter is a major gap, since it appears to be widespread practice for private sector companies to recruit nurses into the UK, only for them to be subsequently integrated into the health service. Meanwhile, specific bi-lateral agreements have been concluded with some countries which take into account the need to protect those countries' health and education systems from labour shortages resulting from UK recruitment.[54]

4. Inclusion of a training element in temporary worker schemes

Although Barber explicitly rejects the idea of including a training element in temporary worker schemes on grounds of cost, it is worth noting that the value of such training would depend on the sector in which temporary worker schemes were being developed. Whilst for many low skilled occupations, Barber is probably right that the costs of training in the UK would far outweigh equivalent training that could be provided in the migrant's country of origin, this should not rule out the possibility of training in basic issues such as the rights and entitlements that foreign workers have whilst in the UK. There are also some areas in which the UK might be seen as having a comparative advantage in training provision that could benefit migrants on their return. This would most obviously be the case in specialised medical or nursing fields, but might also apply to training in areas such as health and safety, management, or corporate governance, where UK standards might be higher than many developing countries—as well as the English language training mentioned above.

CONCLUSION

The suggestions outlined above are advanced not as a coherent proposal to make temporary worker schemes in the UK more "development friendly", but more as a starting point for debate on this important subject. After a long period in which temporary mobility was rejected across the political spectrum, temporary mobility schemes are now firmly on the political agenda, both in terms of new UK schemes, and at an international level in terms of discussion around GATS Mode IV. It is unlikely that any one set of rules or guidelines could provide a "development-friendly" solution to the wide diversity of movements from different countries and involving different sectors, whilst the labour market needs of receiving countries might be expected to remain a primary concern in the introduction and revision of schemes. Nonetheless, the engagement of development actors in this process could yield important results.

February 2004

33 This note is submitted in a personal capacity, and does not represent the views of the Development Research Centre on Migration, Globalisation and Poverty. I acknowledge the valuable comments of Ben Rogaly and Clare Waddington on an earlier draft, but responsibility for the views expressed remains my own. The Migration DRC is considering the organisation of a workshop on this theme later in 2004. Back

34 Barber, C, 2003, "Making Migration `Development Friendly'". Unpublished MA dissertation. Placed in Library. Back

35 The existence of labour shortages in food processing in the UK does however beg the question of whether this industry might be better located in the South, where food crops are grown but often exported to the EU unprocessed because of tariff barriers on processed food. Back

36 Figure relates to financial year 2002-03. Quoted in Home Office evidence to this Inquiry. Back

37 House of Commons answer to question 70795, 23 Jul 2002. Back

38 A quota of 10,000 each has been set for the hospitality and food processing industries. See Clark, J. and Salt, J. 2003, Work permits and foreign labour in the UK: a statistical review, www.statistics.gov.uk. This figure is for total applications to mid-March 2004, quoted in Home Office evidence to this inquiry. Back

39 Figure for 2003, quoted in Home Office evidence to this inquiry. Back

40 Estimate for 2002 from NGO "KALAYAAN" reported at http://www.irr.org.uk/2003/august/ak000004.html Back

41 Au pairs are not strictly classified as workers, since their main intention is to "allow young people to improve their linguistic skills and experience life in another country in exchange for day-to-day family duties". However, as Newcombe (2004) points out, the reality is that many au pairs can be considered migrant domestic workers. See Newcombe, E., 2004, Temporary migration to the UK as an au pair: cultural exchange or reproductive labour?, Sussex Migration Working Paper no 21, University of Sussex. Back

42 Newcombe, E, 2004, op cit. This figure is an estimate for 2002 of all au pairs coming to the UK; in 2002, around 12,000 entered with visas from outside the EU-those inside the EU do not need a visa. Back

44 The "Voluntary Assisted Return and Reintegration Programme" (VARRP) was launched in 1999. In addition, there are specific schemes in operation notably for return to Afghanistan, and until recently, to Somalia. Back