I want to turn to the current points-based system. Again in the spirit of non-partisanship, I must say that this Government did not arrive and tear up that system. We said that we could build on it and we accepted the point of having objective ways of measuring who comes to the UK, and that is what we are seeking to do. Under that objective system, a sponsor assesses the intentions and ability of the student; UKBA staff no longer have

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the power to refuse a migrant entry to the UK on those grounds. We therefore need to make absolutely sure that sponsors are exercising their powers responsibly, and that is one of the things that these reforms are designed to achieve.

Mr Stewart Jackson: Will my hon. Friend give way?

Damian Green: I will give way once; I suspect that I will not get through my speech if I give way to all the Members who wish to intervene.

Mr Jackson: I am very grateful to my hon. Friend for giving way. On the points-based system, given that the overall purpose of immigration policy is to reduce net migration, can he confirm that after the introduction of the points-based system in 2007, arrivals of students, dependants and student visitors increased from 370,000 in 2007 to 489,000 by 2009?

Damian Green: Absolutely. Indeed, the numbers were still rising right up until last year. We now have the figures up to the summer of last year and the numbers were still rising at that point. As I was saying, we are building on the points-based system, but we are precisely introducing limits and precisely driving out abuse in the student system. That is why we will move on to other systems, so that we can get the numbers down. The points-based system is not enough on its own, but it is a platform on which we can build.

The Home Secretary announced new reforms that mean that all sponsors must now be vetted by one of the approved inspectorates and all of them must attain the status of highly trusted sponsors. In line with that commitment, we announced earlier this week that the Quality Assurance Agency for Higher Education and the Independent Schools Inspectorate would extend their activities to cover privately funded providers. Sponsors must meet our immigration requirements and high standards of educational provision. Institutions that do not meet those requirements are now subject to a limit on the number of students that they can bring in. To stay on the sponsor register in the longer term, they must achieve highly trusted sponsor status no later than April 2012 and gain accreditation by the relevant agency by the end of 2012. The imposition of a limit responds to the urgent need to tackle abuse, allows sponsors time to adjust to the new system and prevents surges in applications from high-risk sectors. We are well on track to delivering a sponsorship system that the public can trust.

We are also raising the bar on entry requirements. All students coming to study degree-level courses must now be able to speak English at an upper intermediate level and others will have to speak English at an intermediate level. If students cannot answer basic questions in English about their course, UKBA officers will refuse them entry at the border. That was another point legitimately made by the Chairman of the Home Affairs Committee. We are now bringing back the power for immigration officers at the border to recognise that someone is obviously, indeed blatantly, incapable of fulfilling the requirements of their visa.

In recognition of our trust in universities, we are flexible about the methods that they use to assess a student’s level of English. That brings me on to a

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specific point that was made by the hon. Member for Sheffield Central. Let me start by discussing what is, if you like, the biggest transitional issue. That is the English language requirement, which he raised in his introductory speech.

The appropriate level of English for those coming to study at level 6 and above is an upper intermediate level across each of the four disciplines: reading; writing; speaking; and listening. That is level B2 on the common European framework of language. A lower level—B1—is the appropriate level for lower courses, including the pathways courses that many Members have mentioned. Those are courses taken by people coming in who do not have the appropriate level of English but who want to take an English language course in the UK on their way to taking a full university course here. So we have set a lower level of English as a requirement for those students.

In order to get a visa, those outside universities will have to present a test certificate from an independent test provider proving that they have attained the required level. As another flexibility that we have introduced, universities will be able to vouch for a student’s ability if they are coming to study at degree level or above. Indeed, there might be the odd student who cannot meet the requirements for all four disciplines but is so exceptional that we will allow individual requests by university academic registrars.

A number of Members have talked about English language schools. People who want to come to the UK to study lower-level English can do so for up to 11 months through the student visitor route. We introduced that concession after discussions with the English language colleges last autumn, and the colleges have welcomed it.

On the confirmations of acceptance for studies and the visas, the requirements for an offer of a place at a university are separate from the requirements under the immigration rules. Universities could, and should, have assigned a confirmation of acceptance for studies to people who held unconditional offers before 21 April. Someone with a conditional offer has, of course, not yet satisfied the university’s own academic entry requirements. The immigration system and its requirements have always been separate from the academic entry requirements, and it is important not to confuse the two. For instance, any Government would refuse a student entry if their background indicated that a potential harm would be posed to the UK, even if a university had given an unconditional offer of a place.

It was mentioned that there are difficulties relating to the English language tests. The UKBA ran a procurement exercise and expanded the list of English test providers to ensure that there was significant capacity, and we are in regular contact with each of the approved test providers, which have demonstrated flexibility in expanding test centre capacity where there is demand. If there are blockages, we are trying hard to remove them.

There has been much inevitable discussion about the impact assessment, and various figures have been cited. I wish to put on the record that the net cost is said to be £2.4 billion. The £3.6 billion is the gross cost, but there will also be £1.1 billion of benefits. The truth about the impact assessment process is that it is in its infancy and is not yet satisfactory. I have spoken to the economists who do the assessments and they agree that the process

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needs to improve. I do not want to go into the economic theology of what works and what does not work because it is late on a Thursday afternoon, but I shall give one very practical example. The way in which the assessments are carried out requires us to assume that there is a zero displacement effect of students taking jobs on the local labour market. In other words, if a foreign student is doing a job and then leaves, 100% of that economic activity is assumed to be lost. In practical terms, however, it is likely that that person will be replaced by a British student or someone else. Clearly, therefore, the assessments are not satisfactory, and we have asked the Migration Advisory Committee, which is independent of Government, to look at the process over the summer.

The definition of immigration is beginning to vex us, and I am half-tempted to spend a long time discussing whether students should somehow be removed from the definition altogether. There is clearly an academic argument to be had, but I will just make the underlying point that although it would be fantastically convenient for the Minister for Immigration suddenly to discover that hundreds of thousands of people who were regarded as immigrants yesterday would not be regarded as immigrants tomorrow—I would hit my targets with no effort at all—that is not realistic, and I do not think that the public would accept it. In terms of confidence, the point is very well made that immigration statistics are imperfect, particularly regarding counting people in and out, and that is why we have re-let the e-Borders contract. Over the next few years we will develop a much greater ability to count people out as well as in, but it seems sensible to stick to the internationally agreed measurements we have always had, which are used by other countries, rather than apparently try to redefine our way out of what is a serious and difficult political issue.

The other big subject that many Members have mentioned is post-study work, and I am afraid that I will have to agree to differ with the hon. Member for Sheffield Central. The students’ primary motivation should be to study, not to work. The ability to work after finishing a course or, as my hon. Friend the Member for Woking (Jonathan Lord) said, while doing a course, should not be a significant part of the motivation of someone coming here on a student visa. If people want to come here to work, there are work routes, and I do not want them to deceive either us or themselves by saying, “I’m here as a student but what really matters to me—the motivating force—is that I can either work during the course or stay for a couple of years afterwards.” It is simply not the case that everyone who does that gets a graduate-level job. In one cohort that we looked at, of those who were hanging around for the allowed two years after finishing their degrees, about 20% were unemployed, and 50% of those who were employed were in unskilled jobs and not making use of their studies.

Tony Lloyd: Does the Minister not recognise that there are some people who would benefit as part of the total package of education plus skills training but who might not qualify under the current post-study work route structure?

Damian Green: No. The problem is that the post-study work route has been abused as much as it has been legitimately used. We are not closing down that route

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altogether; we are specifically saying, “If you can get a graduate-level job, you can stay.” That seems very reasonable—[Hon. Members: “It is about the salary”]. I thank Members for that. Let me talk about the £20,000 salary that the hon. Member for Sheffield Central suggested was somehow wrong. I have to say, in the gentle spirit of non-partisanship in which I am making this speech, that the £20,000 minimum salary threshold for tier 2 was set by the previous Government, following a recommendation by the Migration Advisory Committee in August 2009. At that time, the tier 2 skill threshold was jobs at national vocational qualification level 3, and this Government have now raised that threshold to jobs at NVQ level 4, at which level the case for a salary threshold of at least £20,000 becomes even more compelling.

Paul Blomfield: What the previous Government surely had in mind when they set that threshold was not post-study work but the conventional application for tier 2.

Damian Green: It was set as a graduate-level salary, and it still is. We have kept that threshold. We have not inflation-linked it, and we have increased the skill level, so, if anything, there is a stronger case for it now.

I have a fascinating answer about accountancy qualifications for the right hon. Member for Sheffield, Brightside and Hillsborough, but given that there are only three minutes to go I hope that he can hold his interest on that topic and bear to have my reply in writing.

In response to a point made by the hon. Member for Edinburgh North and Leith, it is true that initially universities were automatically granted highly trusted sponsor status, but they were all required to apply for the status by the end of June 2010. All applications were considered against the published criteria. I was puzzled that someone said they were confused about the criteria,

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because they were published. Universities retained highly trusted sponsor status after June 2010 only if they had met all the criteria.

The hon. Member for Scunthorpe (Nic Dakin) made a point about independent schools. Independent schools have been afforded greater flexibility simply because of their extremely low levels of non-compliance. They have earned that privilege because they are practically 100% compliant. The requirement for a secure English language test applies to all users of tier 4 general. Independent schools largely use the tier 4 child route, for which there is no English language requirement. That route is also available to sixth-form colleges that recruit 16 and 17 year olds.

There was a question about the list of financial institutions, and I can say that that list will be available on the UKBA website shortly. The hon. Member for Newcastle upon Tyne Central (Chi Onwurah) asked about quotas, and I am happy to assure her that there are no quotas for UKBA officials to grant or refuse applications.

Once all the rules have been implemented, I expect the reforms to reduce the number of student visas by about 70,000 a year, and I estimate that at the end of this Parliament there will be about 260,000 fewer student visas and about 100,000 fewer dependants’ visas. Members have raised many practical issues that I have not had time to address, but I will take them away and think about them hard, particularly the individual cases mentioned by the hon. Member for Manchester Central (Tony Lloyd) .

I am of course aware of the importance of international students for British educational institutions and for the UK economy, but I believe that the measures strike the necessary balance.

5.30 pm

Sitting adjourned without Question put (Standing Order No. 10(11)).