UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE
To be published as HC 886-i

House of commons

oral EVIDENCE

TAKEN BEFORE THE

Business, Innovation and Skills Committee

Student Visas

Thursday 24 March 2011

Professor Eric Thomas and Neil Carberry

DAMIAN GREEN, MP and JEREMY BROWNE, MP

Evidence heard in Public Questions 1 - 88

USE OF THE TRANSCRIPT

Oral Evidence

Taken before the Business, Innovation and Skills Committee

on Thursday 24 March 2011

Members present:

Mr Adrian Bailey (Chair)

Paul Blomfield

Rebecca Harris

Dan Jarvis

Simon Kirby

Ian Murray

Mr David Ward

Nadhim Zahawi

________________

Examination of Witnesses

Witnesses: Professor Eric Thomas, Vice-Chancellor, University of Bristol, and Vice-President, Universities UK, and Neil Carberry, Director of Employment Affairs, Confederation of British Industry, gave evidence.

Q1 Chair: Good morning, gentlemen. Thank you both for your evidence and agreeing to come before the inquiry today. Obviously this has been a rapidly moving issue and we are very interested in getting your reaction to the announcements made on Tuesday and the implications for you. Before we start the questioning, could you just introduce yourselves so that we can get voice levels and transcription right.

Professor Thomas: I am Eric Thomas. I am the Vice-Chancellor of the University of Bristol and Vice-President of Universities UK.

Neil Carberry: I am Neil Carberry. I am Director of Employment Affairs at the CBI.

Q2 Chair: Thanks very much. Can we just start with a fairly general question? How would you summarise the benefits of international students to the UK?

Professor Thomas: The first benefit of an international student is an academic benefit. In other words, we are bringing in highly talented individuals who bring different intellectual viewpoints to our universities, different cultural backgrounds. They add to the intellectual and academic mix; they affect our own students. In other words, their interactions with our students provide a broader and wider academic environment, and of course there has been a very, very long history of student mobility over the centuries among universities. So their primary benefit for us is an academic, intellectual benefit, but they also, nowadays, contribute very significantly to the income of universities. At a time when other income levels are constrained, this is an important income stream for us and also for the economy.

Neil Carberry: I wouldn’t disagree with what Eric said there. I think from a business point of view the capacity to bring into the UK potentially high-flying future graduates in fields like science, technology and maths enhances the ability of UK universities to work with business on some of the high-technology manufacturing work that businesses are interested in pursuing alongside universities, enhancing the quality of graduates available to UK businesses and, of course, often supporting the continued existence of key departments in universities on the financial basis that Eric has set out.

Q3 Chair: A question to UUK: your press release does give the impression that you are pleased with the outcome of the review. Do you think that the problems that we have had with student visas are now over?

Professor Thomas: The first thing to say is that quite a lot of change had occurred in the previous two years about the visa system, which I think had made the situation significantly better. We are pleased with the outcome of the recommendations made last Tuesday. We do genuinely feel that both the UK Border Agency and the Government listened; they involved themselves in considerable discussions with us; they were open to our suggestions; they recognised the problems that significant constraints on student visas may cause us; and they have addressed virtually all of our concerns in the recommendations that they have put forward.

Q4 Chair: Do you anticipate that basically all those applicants that want to come to universities, and it is appropriate and legitimate for them to be there, will be allowed in now?

Professor Thomas: I think it is fair to say that that is what we anticipate. We will be interested to see how it operates. It is like many things to do with visas, the devil comes in the detail, and we are going to work through the operation obviously with UKBA but I think that the answer to your question is yes.

Q5 Chair: Will you be involved with-shall we say-working on the process for this with UKBA?

Professor Thomas: Universities UK has had a member of staff in UKBA permanently over the last few months. We are now working much closer with them in addressing the issue. So the answer is we will be involved, but obviously they will be the main agency.

Q6 Chair: I just turn to the CBI now, really the equivalent question: do you think the issue is now being solved as far as business is concerned?

Neil Carberry: I think the principal issue, yes, has largely been resolved. The key things that we set out in our response to the Home Office in January were that there should be protection for graduate level and pre-graduate level entry in the new system and that the post-study work route should be retained, albeit targeted to ensure that it is economically beneficial. I think the statement made on Tuesday largely ticks both of those boxes.

Q7 Chair: Have you been involved with the UKBA in devising appropriate processes?

Neil Carberry: Yes, and I have to say that over the last couple of years both the Home Office and the UKBA part of it have come a long way in working with outside stakeholders. I think it is appropriate to record in this session the appreciation that we and I know other stakeholders feel for that in terms of making the system work rather better in the real world.

Q8 Paul Blomfield: Both UUK and CBI were concerned about the initial proposals on the closure of the post-study work route, and while I recognise the need to develop a positive public narrative arising from the genuine changes that have been made, I detect from talking to vice-chancellors that there remains a concern that the new arrangements are probably still too restrictive and perhaps need some greater flexibility. I wonder what you both felt about that. In particular, for example, is the £20,000 threshold going to be too restrictive in terms of regional variations, sectoral variations?

Professor Thomas: The first thing is there are two aspects to post-study work. The first is the ability to be able to do it is an important recruitment tool and therefore it had been closed off that would have been a very difficult issue with us because other countries offer it as a recruitment tool, and then only a percentage of people take it up. So the fact it is an option brings people to the country but only a percentage is taken up. It is quite difficult to work out exactly the number. We think probably around about 22%, possibly a little bit more; it is difficult to do that data.

We don’t feel that for most industries £20,000 is too much of a barrier, but we do feel in arts and for musicians that that may well be a significant issue when the average starting salary for those individuals is about £17,000. I think, as I said to the Chair, it will be working on the ground and working this through will be what proves to us whether it is an issue or not. It certainly is something that causes us a little concern, but the fact that we are able to say to our potential applicants that there are the opportunities for post-study work was the crucial issue for us.

Neil Carberry: There is clearly a line to be drawn in any managed migration policy between the economic desirability of having a certain individual in the country doing work and the potential impact of that on the domestic workforce. Therefore in any post-study work you have to draw the line somewhere and I think we are fairly comfortable with the £20,000 limit, because if you look at the major graduate schemes that is sufficient to qualify people in most cases.

Where I think there is more concern on the business is in the frequency with which the rules in areas like this can change, and is something that we would look to work with UKBA on in the coming months. We had an incident earlier this month in Tier 2, in the business tiers, where the salary requirements were changed with very little notice and then corrected because it was a mistake. But these are changes which affect people’s lives and I think, in terms of looking to the delivery of post-study work, what we would be wanting to see is some stability about the expectations of what individuals will have in order to qualify for the visa.

Q9 Paul Blomfield: Can I push just a little further, in that I have just quickly looked at starting salaries for one of the universities in my own constituency and the mean starting salaries just fall under, very close, at £19,900 at Sheffield. While there wouldn’t be problems probably in engineering or in medicine and related areas, pure science falls well below that and I wondered in that context whether you wouldn’t agree that some greater flexibility in the application of that rule would be helpful.

Professor Thomas: It is interesting. We have had discussions with two major scientific institutions, Wellcome and Sanger, who don’t think that £20,000 would be a significant problem for them. Essentially where we are in this is things like post-docs, which are crucial parts of the scientific endeavour, but their information for us is that should not be a problem. What it will probably mean, I think, is that the post-doc salary becomes £20,000 a year.

Q10 Simon Kirby: My question is addressed to the CBI. Could I put it to you that there are additional benefits of having international students studying in this country, one of which is the direct link with inward investment in an increasingly global economy. Is that not a huge potential benefit?

Neil Carberry: Certainly in the broader context, we have been clear in the whole of the work permit reform to encourage Government to think about businesses working in Britain supporting jobs in Britain, based on doing business around the globe, and making sure that the system supports a growth agenda. I think, as part of that, it is certainly true that students from outside the EEA are often brought into companies here from universities here and then returned to their home markets or somewhere in the region with global British companies. That is clearly a benefit. I think by comparison with the importance of Tier 2, it is probably less of the major issue, but clearly it does add value to the attraction of the UK as a place to base head offices.

Q11 Simon Kirby: For the record, Chair-and this is anecdotal and I apologise for that-on our visit to China, it was quite clear to me that certainly in the Chinese mind there was a direct link between the access to education and the desire to do business in partnership. I think that is very difficult to argue against.

Neil Carberry: Yes, I would accept that.

Q12 Paul Blomfield: Just very briefly to Professor Thomas. Is it your understanding from the discussions that you have had with the Home Office that post-doc or post-graduate applications for teaching and research posts in universities would be through the Tier 2 or Tier 4 route?

Professor Thomas: Through the Tier 2 route predominantly, and also the ranking system has given additional weight to PhD-level activity.

Q13 Rebecca Harris: This is to Professor Thomas really. Previously your president, Professor Steve Smith, said that any reduction in international students could affect our teaching here in STEM subjects, and I just wondered if you could expand on that?

Professor Thomas: Did you say STEM, sorry?

Rebecca Harris: Yes.

Professor Thomas: There are some STEM courses which have a significant dependence for their sustainability on international students and, therefore, if there had been a significant reduction in international students coming to them, it could have made those courses unsustainable. There is no cap, and the way the system looks as if it is going to work, we will still have anxieties about that, but we probably have anxieties about such courses anyway, obviously. But we will just have to see how things go going forward.

Q14 Rebecca Harris: Presumably, if that were a problem, this could potentially affect wider industry, like the ability of universities to attract post-graduate research and that kind of thing.

Professor Thomas: Yes. We think the situation we are in now is manageable in those circumstances.

Q15 Rebecca Harris: I would like to expand a little bit on what Simon was saying. Would you say that knowledge of cultural differences is important for British business and how much, for example, an international MBA student might help us to develop trade and export links abroad?

Neil Carberry: Absolutely vital. I think British businesses have long gone beyond the world in which you send someone who essentially looks like me to Latin America to sell a British product. That is a difficult sell. Increasingly we work in a global environment and we seek to bring into businesses the kinds of people who understand the markets in which we are asking them to work. Certainly, we had a very powerful example at the time we were working on the Tier 2 system around a major British plc who were desperately trying to hire someone from South America in order to take a traditional British brand into South America and were having some difficulty with that under the proposals before the Home Secretary’s November announcement.

So from that point of view, it is clearly the agenda of companies to understand the market in which they work and that will require a greater degree of global mobility in the future than perhaps there has been in the past. But what I would emphasise is for the most part for British companies that kind of transfer is net migration neutral. There are as many people leaving UK-based companies as coming in. Certainly, if you go around the table of our major members they would tend to take that view. That is why we push very hard for some of the controls of the ICTs to be set up the way they are in order to encourage businesses to retain headquarters in the UK, because of course that has significant additional benefits to the British workforce in terms of additional jobs here. I think that principle holds for international students as well.

Q16 Mr Ward: Can I just add on to that? When I did an MBA at the University of Bradford I think a third of the course were from overseas. I certainly was not aware of any effort being made to see that as an asset and to utilise it. We basically came there and we all went then away 15 months later or whatever it was. Is there a co-ordinated strategy and, if there isn’t, should there be one for making the most of this great asset that we have, which is people coming to this country to study?

Neil Carberry: We are very, very conscious of the need to improve links between business and our higher education institutions as part of the strategy for growth in the UK, and indeed we published a major piece of work about 18 months ago on business-university links and the need to strengthen them. I am very happy to let the Committee to have that as written evidence after this session if that would be helpful.

Q17 Chair: Can I just tease out a comment that was made earlier and its implications. Earlier, I believe it was Professor Thomas who said that, if you like, post-grad students were coming through the Tier 2 route. Did I get that right?

Professor Thomas: No, that is for post-study work.

Chair: Post-study work, right.

Professor Thomas: Post-study work is now being done under Tier 2.

Chair: Right, thank you. Post-study work. Interestingly, Tier 2 also covers skilled workers with a job offer and intra-corporate transfers below £40,000 salary levels. There is a cap of 20,700 on that. In light of what you said earlier that you expected, in effect, students to be able to get it here-and I would include post-study workers on that-is that going to be enough?

Professor Thomas: I don’t think the students in post-study work are going to be part of that 20,700; that is my understanding. So that is 20,700 individuals coming for a job. My understanding is that currently that is higher than the number of individuals that are admitted under Tier 2 as it stands. Of course Tier 1 is being abolished and we don’t know what the implications for the number of applications will then be as a consequence of that into Tier 2, but at the moment that is higher than the current Tier 2 applications.

Q18 Chair: So you are saying that with the abolition of Tier 1, which had a cap 1,000, they might come in via Tier 2 and that could impact upon it?

Professor Thomas: In which case then I would personally expect the number of applications on Tier 2 to rise. I am just not sure what level they would rise to. But to stress that, of course, if decisions are being made on rankings, specific notice has been taken of the kind of things that would give a higher ranking because of academic issues. What they call the PhD activities, research and development managers, chemists, biological sciences, biochemists, physicists, geologists, higher education teaching professionals, scientific researchers, social sciences researchers and researchers not elsewhere classified are given a priority ranking under the new system. You are essentially describing there a group of people that will be wanting to come to universities.

Q19 Nadhim Zahawi: The sharing of research methods is highlighted as being a major benefit of international students. Do you think we could replicate this in business?

Neil Carberry: Yes, and in fact there is some practice ongoing in that regard. Certainly, a number of major multinationals, when doing work outside the EEA, make arrangements with their joint venture partners to bring people into the UK often under Tier 5, and there is a consultation this summer from UKBA on that that we are doing some work on, to build up some knowledge around IP, either in partner higher education institutions that they are working with or in the business’s own research establishments. That kind of development is absolutely key to the higher end manufacturing and process industry work that many of our UK multinats are working in.

Q20 Nadhim Zahawi: When the Committee visited China, we heard about difficulties of UK companies gaining visas for their Chinese staff to attend conferences, training courses and so on in the UK. Do these experiences surprise you, or are they part of a more common experience?

Neil Carberry: There is a question about the system and there is a question about the process, and I think we have to be fairly blunt that for China in particular, and East Asia more broadly, after 2008 there were some particular issues with speed of processing and decision-making in Manila, which is the regional hub. I would suspect that some of the reports you heard on your visit relate to that and there was some frustration about that at the time. I think most of that has now been sorted out.

Q21 Nadhim Zahawi: Separately, on a number of visits that I have conducted to the Middle East, for example, I saw evidence of similar frustrations with business visas, but your answer seems to be that you are much more relaxed about it than businesses and local chambers of commerce that I met were portraying.

Neil Carberry: I don’t think we are relaxed about in post decision-making, to be honest. It is our impression that the basic design of the system and the policy is right. I think there are certainly still issues with how in post decision-making is done, and from our point of view we would hope that a period of stability would allow UKBA to begin to make sure that that objective decision in post is being made. At the time of PBS being introduced, one of the big changes was to move the decision-making to an in post basis and we, at that time, were very clear that the problem with that is traditionally that has been a subjective decision and I think posts have made variable progress in turning those into objective decisions.

Q22 Nadhim Zahawi: Just on that point, how do we compare with our major European competitors, the Germans, the French and so on?

Neil Carberry: I mentioned Manila. I think during the period of the Manila troubles Britain’s image took a bit of a hit with people coming in from countries like Japan and China. For instance, in Germany, if you were a Japanese FD coming to run the finance operation of a Japanese company in Frankfurt you would turn up at Frankfurt airport and you would spend a couple of hours longer there than other travellers and you would get your visa, and you would have the documents with you. Meanwhile, we were asking senior Japanese business professionals to send their passports to Manila for three weeks. One Japanese executive who I was talking to said, "I’m not even sure that’s legal under Japanese law." There was a sense that, on the operational side, we were asking fairly senior people to do things that were damaging their effectiveness for a period of weeks when, for instance, colleagues going to Germany were doing it very quickly. Now, if you were a Japanese company making a decision about where to base European headquarters that is clearly a very important factor.

Q23 Nadhim Zahawi: That is very worrying, because I heard exactly the same thing on the other side of the world in the Middle East, where they are asked to submit their passport for two weeks to the embassy in Oman, even if they happen to come from another Middle Eastern country, and wait to be told whether we are going to allow them in or not, versus Schengen visas that are delivered in 24 to 48 hours. Isn’t that really the point-that we really did miss out at the most crucial period of the recession?

Neil Carberry: Process speed was an issue from 2008. I know UKBA have made efforts to improve it. There is still some way to go, and I think we are very happy to work with UKBA on examples and on potential improvements.

Q24 Nadhim Zahawi: Let me press you a bit. You say there is some way to go. What would you suggest they do?

Neil Carberry: We would suggest that you apply the same principle that we have tried to encourage them to apply in the system more broadly, which is where people are clearly economically significant you attempt to make the process as swift as possible. For instance, we were clear that we should give priority to Tier 2 over Tier 1, because Tier 2 applicants have a job offer; very clear in Tier 4 that graduates and pre-graduates should have priority because of their higher skill levels. I think in this system we clearly have to have an approach that allows people who are coming into the UK, in large part to take part in a business that is substantially beneficial to the UK economy, can expect to get a decision quickly and an objective decision rather than a subjective decision. Certainly, across the board, we still see examples of-I saw one last week in the student tier where someone was turned away at Heathrow because they didn’t have enough funds to do a whole year course. That was because they were only here for a term and that had to be overturned on appeal and someone missed a couple of weeks of their course. So that kind of process requiring appeal is still a problem.

Q25 Nadhim Zahawi: It sounds to me that the system is still not fit for purpose from what you are saying.

Neil Carberry: I think the system design is fit for purpose. I think there is a way to go and a need for more effort in terms of the path people take through the system. It seems to us that many of our major members have spent seven figure sums on their sponsorship systems, and they are delivering the certificates of sponsorship very quickly. They are assessing them correctly, and yet there is still, in the system, a-

Nadhim Zahawi: Sclerosis.

Neil Carberry: A sclerosis. I was going to use the phrase "some treacle", which is slowing things down.

Q26 Mr Ward: Is it sclerosis, which seems to apply to the whole system, or is it simply that authority is not delegated at a low enough level to make quick decisions?

Neil Carberry: I think authority is delegated reasonably far into the system. I would argue that the issue, certainly in the past, in the period between the introduction of the PBS and the current form, has been that authority has got to the frontline but perhaps not a full understanding of what the policy is.

Q27 Nadhim Zahawi: Thank you for that. My next question is really about Highly Trusted Sponsor and the establishment of that, which the Government states will make the visa regime easier to navigate. You and your universities are already Highly Trusted Sponsors, yet you are still experiencing difficulties, would you say?

Professor Thomas: Our experience would reflect very much what Neil was saying that certainly two to two and a half years ago there was significant difficulties but the disciplines required of universities to get Highly Trusted Sponsor status has made a great deal of difference to how we interact over this issue, more effectively, more efficiently, understanding our responsibilities more. Undoubtedly, my international office at Bristol would say that has been a very good process for the university to have to go through and that we have seen the sort of improvements that Neil has been describing over the more recent past. So my head of the international office would say that on balance most of the time the students get their visas in a timely fashion and are able to come to the university.

Q28 Nadhim Zahawi: Would you say those differences are significant now?

Professor Thomas: They are significant now, yes.

Q29 Mr Ward: Could I just ask you whether you feel that the way of controlling public expenditure in the university sector in the past was really through the capping of undergraduates, so post-graduates, external income generation and all that was as much as you can and international students was uncapped. Do you think that put pressure on institutions-not reputable institutions-to be light in their examination of international applications?

Professor Thomas: The answer is I don’t know. I can tell you in my own institution that most certainly did not take place-absolutely clearly did not take place. When you are taking international students you are in the very best sense protecting your own brand. It is not in your interests to admit not capable international students, because if other international students come and find that to be the case, it is viral these days; it gets out in next to no time at all whatsoever. So the idea that it is in your interests, or certainly in my interests, to accept low-quality students because they simply are bringing dollars or whatever currency with them is counterproductive, profoundly counterproductive.

The other thing is that the international student market is a very unpredictable and very volatile market. Certainly, when SARS came along we took a £7 million in year hit on students not arriving to the University of Bristol, and when your surplus is £7 million, that is a seriously hit. Therefore, in terms of the way that you would take the university forward in a derisking level, we set out level of international students at about 13% to 14% so as we did not expose ourselves greatly to volatility risks. So, while it might be tempting to think that universities might do what you said, for many reasons it could be profoundly counterproductive for them to do.

Q30 Rebecca Harris: If I could just follow on from that, just to put it another way: do you see any risk of any UK university losing their most trusted status? Can you envisage that happening?

Professor Thomas: My understanding is that there isn’t a risk of that at the moment-that is my understanding. I think universities recognise their duties in these circumstances. It is our duty to know which students are coming to us, which students have arrived, how they are doing on the course and what happens to them when they leave, and to be able to answer those questions should they be put. In view of society saying you can bring these individuals to the country against the anxiety about migration then we have to fulfil those duties to be Highly Trusted Sponsors. I think universities take that quite seriously. As I say, the process of going through that over the last two and half years has been very important for universities. I am not aware of a university that is about to lose HTS.

Q31 Nadhim Zahawi: Very quick last two questions, and one is probably more relevant to the next panel, which is the Ministers, but I will ask you as well. The Government is proposing obviously a 20-hour limit on student working. If a research student does more, will they be breaking the terms of their visa? What do you understand the consequences of that action to be and who will be responsible for that? Is it the student or the sponsor or the employer?

Chair: Which one of you will get it in the neck?

Professor Thomas: My understanding is that the person who will get it in the neck will be the student. It bears repetition that only 2% of overseas students to universities are non-compliant. We are not the non-compliant end of the game. If I can be personal, my daughter’s partner is a Mexican who is studying a PhD at King’s College in London, and he was offered work of 24 hours and he didn’t take it because he was so frightened of losing his visa. These are not non-compliant individuals. These are people who it is so important for them to be here and to be experiencing that PhD that they are not going to break the terms.

Q32 Nadhim Zahawi: The differentiation between publicly funded and private universities, is that a good thing? The system is going to differentiate.

Professor Thomas: The system differentiates-

Nadhim Zahawi: The new system.

Professor Thomas: I see, right. I am not quite sure what you mean. You mean the EPP-the entirely private providers-but they will still, I believe, be subject to the same constraints as a publicly funded university.

Q33 Chair: I don’t want to introduce a whole line of questioning based on your personal circumstances, but you have just quoted one that was quite interesting. What are the broader implications, in terms of recruiting talented people into business, of the regulation as it stands-the 20-hour limit? Is there any way that, from your perspective, you think it could be improved?

Professor Thomas: I think the primary reason that these individuals come to this country is for academic development and therefore you have to look at what will be a reasonable number of hours’ worth of work to do if you are reading for a PhD or you are doing an MA. It seems to me that 20 hours is a reasonable amount for that reason alone, not necessarily because it is arbitrarily set there but if someone was doing 40 hours work a week, how in the world do they have the time to do a PhD? When I did my doctorate, it occupied every hour of my working day, and I certainly couldn’t have done an additional 20 hours’ worth of work. So it seems if a figure is going to be set that 20 hours is a reasonable figure to be set against the background of what is in the best interests of the individual pursuing that academic activity.

Q34 Chair: The other side of the coin: do you think you could lose potentially talented people in business as a result of it?

Neil Carberry: I think our support for the 20-hour limit is based on the fact that if we are letting people into the country to study and they want to earn a little more money to improve their standard of living then that kind of opportunism should be encouraged. Certainly, there are parts of business where long-term employee relationships do start with very limited periods of work on the frontline, particularly in retail. Therefore, some of those relationships may be fostered while doing less than 20 hours a week. One of the key pieces of feedback we had from our members at the time of the consultation, though, was that students who want to work a package of five or 10 hours a week are quite useful in some parts of the country with relatively tight labour markets, even at the moment, because they are willing to do shifts that are very difficult to recruit for.

Q35 Mr Ward: Was it not also, in this stage of deregulation, an issue for employers about the whole bureaucracy of record keeping and reporting on the hours?

Neil Carberry: We have always had an hours limit, and I think the systems are relatively well set up for that. Largely for the reasons that the professor has set out, you want to have a limit because if someone is working for one of my members for 35 hours a week then you would legitimately ask questions about the course that they are doing at their educational institution.

Mr Ward: Unless they were a really good employee and you didn’t want to lose them.

Neil Carberry: Twenty hours a week seems to us to strike the right balance. What we were pleased with was that the Government moved back from its proposals to try and regulate that further. Clearly, when they were talking about just doing on campus work or only allowing work at weekends, that would have been a significant burden, very messy, and I don’t know about you, but certainly when I was a student weekends were something that happened to other people. My work week focused on the two points at which I had to deliver work to my extremely demanding tutor.

Q36 Chair: It is not unique to students; politicians have the same problem. Can I move on to the issue of standards of English? Obviously, you will have noted in the Minister’s statement on Tuesday, the announcement, that higher levels of English will be required from visa applicants. A number of issues were raised on the Floor of the House in that context and I would welcome your perspective on how these changes could impact on the successful applicants and the implications for your respective professions.

Professor Thomas: We are quite content with B2 for undergraduate degrees. We think that is a reasonable position. There is an exception made: the classic story of the mathematician, the brilliant mathematician who can’t speak English very well but isn’t going to have to use it and therefore will be able to come, because they don’t speak English in mathematics apparently-I’m not sure. Our anxiety was setting B2 for pre-university courses, because that would have had very significant impact and 40% of undergraduates from overseas coming to British universities come through a pre-university course. So, setting it at B1, certainly we were pleased that the Government did that and understand the need that they will still have to be at B2 when they enter the undergraduate degree. There had been a suggestion of B2 for the pre-university courses and that would have had a major impact. Setting it at B1 solves a significant amount of that.

Neil Carberry: I agree with most of that. I think we are very comfortable with the standards as they are set out now. Clearly, employers in the UK tend to like employees to be able to speak English and the B2 standard is, we feel, the right one where it has been set. I think the one concern we would have, and it comes back to the discussion we had earlier, is about when that assessment is made and how that assessment is made. We are fundamentally uncomfortable with a B2 assessment being done on the basis of a chat at Heathrow. I think there has to be due process for people to show that they have B2, have the certification and for that to be trusted through the system.

Q37 Chair: You have partially pre-empted my next question. My understanding is that universities will be afforded a level of discretion, basically, on assessing the applicant’s command. First of all, from the universities’ perspective, how is that going to be done and will it be potentially challengeable by the UK Border Agency? If all of this is the case, how will those disagreements be resolved? I will start with yourself and then go on to your perspective.

Professor Thomas: The answer is I am sure it will be challengeable by the UK Border Agency, but if we can go back to basics again, we don’t want to admit people to our degrees who are having major difficulties with English. What that does is just create a huge workload for us in terms of having to supervise the students, having to take the students on the journey through to their degree. Let me be quite clear: it is in our interests to ensure that there is good facility with English for the students coming to our universities. So we are already set up quite well to check on the English capabilities of our students.

Q38 Chair: You already have a process in place to make that assessment?

Professor Thomas: We have a process in place, absolutely. As I say, we don’t want to admit people whose English is poor and therefore we will be able to continue with that, and I think it will be part of the highly trusted status that that is left to us to do. But I have no doubt that there will be monitoring of that by the UK Border Agency, and that if they feel we are not doing that appropriately, I am sure it will be challengeable. It is our duty to do that properly.

Q39 Chair: In a moment, I will bring in Paul Blomfield, but basically should business be able to make the same assessment? From what you said earlier, I get the impression that you haven’t really thought through what business could do to make this assessment. Is that correct? What would you suggest?

Neil Carberry: No. Within skilled tiers, in particularly Tier 2, there is already a testing framework in place that businesses comply with. We also have a similar process for certain scientific people coming in-for instance, from the major Japanese car manufacturers who are coming to live in the UK for a period with an interpreter standing next to them because they are extremely well paid. What they are doing is giving technical input into the production of a new car in the UK. So both those tracks are already in place in Tier 2.

Q40 Paul Blomfield: To follow up on this issue, I thought Professor Thomas very fully described the robust system that is already in place for university assessment of proficiency in English. There does appear to be, within the Home Secretary’s statement, a residual discretion for UKBA officials at point of entry to make their own decision about proficiency. Do you think that those officials are adequately trained to make those sorts of decision in relation to university courses?

Professor Thomas: The answer to that question is I don’t know. I have been invited to the frontline in September at Heathrow personally to sit with these officials and see when the wave of students come through. They do provide quite significant anecdotal tales that tend to make your hair curl a little bit of when they ask somebody which university they are going to and they are not capable of answering that, or which course they are going to and they are not capable of answering that, and then when you open the luggage, there are builder’s tools in it. The UK Border Agency has a number of anecdotes of apparently going to quite well established universities. So one must take that at face value. I can’t see how we can’t allow a decision in those circumstances to be made by an official on the frontline. But you would have to ask the UK Border Agency about the level of training that they have, because I don’t know.

Q41 Chair: We are coming to the conclusion of our questions but just a couple of final ones. Obviously you have been fairly positive about the changes that have been announced, but certainly from our visit to China, and other anecdotal evidence there does seem to be a perception abroad, arising from the previous visa regime, that Britain is no longer open for business. What do you think the Government can do to change that?

Professor Thomas: Well, it can shout from the very rooftops that we are open for business. I can tell you that the overseas applications to the University of Bristol this year have never been as high as they are. So if the message out there is that we are not open for business, people aren’t listening to that message; they are applying to come to our university. Let’s be quite clear about that.

Certainly ,the Minister made the "open for business" very, very, very plain when he spoke at the Going Global conference in Hong Kong a couple of weeks ago. The President of Universities UK has been saying that whenever they go abroad. We have to get some clear messages out that overseas student fees are not affected by changes to home undergraduate fees, which is a misperception that overseas students thought that they were having their fees trebled.

There is a very interesting analysis by a think tank in Boston of the quite precipitate drop in overseas applications to Australia that caused real problems in Australian universities, and their analysis was that society goes through kind of migration positive-migration negative cycles and that the overseas student applications pick up that a society is in a migration negative mode, and that is the most off-putting thing for them-the sense that that society at the time is not positive about migration. So there needs to be a series of things that say, "Yes, we do want highly skilled; we do want the very best coming to the United Kingdom" and that needs to be at ministerial level and in publications, and universities need to also say that quite clearly.

Neil Carberry: That message goes for the whole of the business community as well. The key thing is to make the very reasonable goal of having a balanced migration strategy that takes account of both economic and social issues, to deliver a message around the world that if you want to come to Britain to invest, if you want to partner with a UK university, if you want to set up a head office here, that you can do that, that you will not be held back from bringing in the 15 or 20 people you need to run an operation of 200 or 250 people.

I think that means that everything that the Government does-be it asking the Migration Advisory Committee about Tier 2 limits, be it about the message that the Prime Minister gives when he speaks on the subject-has to make clear how and by which means the policy is supporting the goals the Chancellor set out yesterday in terms of boosting UK economic growth.

Q42 Chair: A final question to you, Mr Carberry. We have had previous evidence, in our case from Airbus and I believe that there was also a debate in the House of Lords that quoted Google, about British companies having difficulties with UKBA in processing visas. Is this untypical, or would you agree it is a problem and do you think it is still going to be a problem?

Neil Carberry: I will refer you back to the discussion we had earlier. I think the problem was much more substantial 18 months to two years ago. It is still the case that the system is slower than many international businesses would like it to be and that they feel it ought to be given the amount of investment they are now putting behind getting their applications right, and in terms of some of these global companies, such as the two you mentioned, clearly getting people into the UK to do work that is good for the broader economy quickly is beneficial for us all.

Chair: Thank you. That concludes our questioning. Can I thank you once again for attending? We will now be interviewing one of the Ministers, and you will no doubt see the outcome of our deliberations in due course. Good luck, gentlemen.

Examination of Witnesses

Witnesses: Damian Green, MP, Minister for Immigration, Home Office, and Jeremy Browne, MP, Minister of State, Foreign and Commonwealth Office, gave evidence.

Q43 Chair: Thank you, Ministers, for agreeing to come to speak to us today. Before we start the line of questioning, could I just ask you to introduce yourself for voice transcription purposes?

Damia n Green: I am Damian Green, the Minister for Immigration.

Jeremy Browne: My name is Jeremy Browne. I am a Foreign Office Minister and I lead geographically on China, which I understand you are particularly interested in, Mr Bailey, but I also take the lead on migration policy within the Foreign Office.

Q44 Chair: I am going to bring in Dan Jarvis in a moment, but before I do so can I ask the Minister just to clear up an element of confusion that has arisen from our questioning with the previous speakers. I was still under the impression that there was a cap of 1,000 on highly skilled migrants. Our previous speakers seemed to think that that had been scrapped. Can you tell me is this correct and, if it is correct, has there been any accommodation in the potential levels for Tier 2 applicants to accommodate ones that might previously have arrived via Tier 1?

Damian Green: I am sorry to sound over-pedantic, but it depends what you mean by highly skilled migrant, the phrase that used to be used. There was a highly skilled migrants programme, which was superseded by-

Q45 Chair: I am talking about those who are qualified under Tier 1. I don’t know exactly what the criteria are.

Damian Green: Tier 1 had various different elements to it. We have scrapped Tier 1 General, which was, if you like, the successor to the old highly skilled migrants programme, and we have replaced it with a number of elements, one of which is the entrepreneurs and investors visa, which is unlimited. We want as many of those as want to come and settle in this country. One of which is the exceptionals visa. That is, I think, where the confusion may lie. That does have a limit of 1,000 a year, and that is specifically designed for scientists, performing artists and so on, particularly young ones who may well not qualify under Tier 2 because they are not paid very much, because they are young and promising. Essentially, it is a way of making sure we don’t just get today’s Nobel Prize winners but hopefully tomorrow’s Nobel Prize winners as well. The people chosen for that will be chosen not by us, not by the UKBA, but by a range of competent bodies like the Arts Council, the Royal Society, and so on, experts in their field, who will each be allocated part of that 1,000 allocation and say, "Yes, him, her and her, they are all absolutely world class. Can we have them in please?"

Q46 Chair: Can I just clarify so that I have it right. The category of highly skilled migrants, hitherto known as Tier 1 applicants, has been abolished and replaced by entrepreneurs and investors over which there are no limits. Is that correct?

Damian Green: Partly correct, yes. There are also other bits of Tier 1 as well. Tier 1 has been, as it were, redefined into those categories, one of which is limited, one of which is unlimited.

Q47 Chair: But the entrepreneurs and investors is part of the unlimited?

Damian Green: Is unlimited, absolutely is unlimited, yes.

Q48 Chair: Another element, which is limited and which would previously have been covered by highly skilled migrants, is, if you like, the talent issue.

Damian Green: Yes. Scientists and talent, yes.

Q49 Chair: In theory, there is potentially an increase in that particular category, or what had hitherto been that category, Tier 1?

Damian Green: I would hope we do better, particularly at getting entrepreneurs. The Canadians have a specific entrepreneurs visa and, whereas we had fewer than 300 entrepreneurs come to settle in this country last year, the Canadians had 3,000. I think in terms of long-term job creation, Britain being open for business and all of that, we want to do better at attracting the world best’s entrepreneurs to come and operate from this country.

Q50 Mr Jarvis: My questions are for Mr Green. Your proposals state that from April 2012 all institutions wanting to sponsor students will have to be rated as Highly Trusted Sponsors. Can you talk through the Committee what the criteria are for achieving the status of Highly Trusted Sponsor?

Damian Green: There are nine different criteria that you have to reach. I won’t worry the Committee by reading out the page of briefing, but essentially they allow us to know that over a period of time an institution is completely reliable and that the people they bring in are completely reliable. There are various elements: you have to have been an A-rated sponsor for more than six months; that your procedures and the way you check documents, that we will obviously check ourselves, need to be up to scratch; and perhaps crucially for academic institutions, that the vast majority of the students that you bring into this country, or that you give visas to, turn up to the course, turn up regularly to do the course and complete the course at the end of it. There are different layers: 99% we expect to turn up and register and a slightly lower number we expect to complete the course, because obviously people fail courses. But essentially that is what those nine criteria boil down to-that what you are is a proper and properly run academic institution.

Q51 Mr Jarvis: Thank you. I accept this may help root out some of the bogus colleges, but how will it help the existing Highly Trusted Sponsors, such as universities, which already experience problems with the visa system?

Damian Green: I would slightly question the last assertion. It will help them by increasing the confidence around the world that if you come to Britain to study that you are getting the top of the range experience that you hope to get. Interestingly, one of my most recent meetings was with the Interior Minister of Pakistan who was complaining bitterly on behalf of many Pakistani students who were genuine students who turned up in this country and found that what they were being offered was clearly bogus. He made the point, and I agree with him, that if that happens to a number of people then it is obviously publicised in the source country, and they think, "Well, am I going to be conned if I come over to the UK?" and therefore that will infect the whole system and potentially drive people away from this country. It will be a significant advance for reputable and respectable institutions that we can be more confident than we have been in the past that if you come to Britain to get an education what you are going to get is an education.

Q52 Nadhim Zahawi: Minister, we heard from the previous witnesses that although, quite rightly, the system is better in terms of visas since the problems that stemmed from 2008, in their words, it is sclerotic or like walking through treacle still today. One example was given about China and Japan where the processing was taking place in Manila, and that processing seemed to have broken down somewhere. In other members of this Committee’s experiences in other parts of the world, the Middle East for example, where people have to go to a third county like Oman, submit their passport, wait two weeks to be told whether they can come to our country or not, versus our competitors in Germany where they get a Schengen visa that allows them to travel across the whole of Europe but also the process is so much simpler and quicker and more efficient. Some of the evidence is about whether the UK Border Agency playing its role in talking to the Foreign Office. This question is to both Ministers: can you just take us through how you co-ordinate between you? Is it, as the witnesses have said, still problematic, if not sclerotic, and what are we doing to improve it?

Damian Green: I think a lot of the problems are historic. I don’t think the system is sclerotic and-

Nadhim Zahawi: That is what we have just heard from the CBI, Minister.

Damian Green: Let me give you the facts. In 2010, our visa section in China issued 55,000 business visit visas, which is a 21% increase on 2009. Our target is to process 90% of this type of application in 15 working days, and the average processing time for a business visit visa in China was four days and 83% of business visit visas were processed in five working days.

Q53 Nadhim Zahawi: That is all excellent. I don’t disagree with you. All I am saying is, and statistics are a wonderful way of demonstrating how well we are doing, comparables with other parts of the world, especially our competitors, doesn’t deliver the same message.

Damian Green: Let me move on to Schengen because, of course, the biggest difference between us and Schengen at the moment is that we take biometrics-we take fingerprints, face recognition and so on-and they don’t. The biggest single difference is that anyone who comes here has to go somewhere to have their fingerprints taken, and that is, for many people, difficult and a pain. We recognise that, but we are completely unashamed about doing it because it massively increases the security of our border and the Schengen countries all aim to replicate that, so that particular, if you like, inconvenience for individuals will disappear as a comparator in the next few years. We recognise that that is a hurdle people have to jump and that is why in China we have 12 visa application centres, which is more than any other country. I think in business terms-we are concentrating on China because that is obviously a hugely important market-we are doing absolutely our best to make it easier. In terms of students, for example, it is an interesting statistic that we have as many Chinese students in this country as they do in the USA, a country with far more universities, six times the size, all that kind of thing. So just the facts tell me we are not doing too badly in that.

I have given you the figures for business visit visas. Last year, we issued 44,000 student visas in China, which is an increase of 27% over the previous year. Again, that does not seem to me like a system that is failing to deliver for the British universities that want people to come in. As I say, I would challenge the negative descriptions. You asked about how we work together, and understandably there is some confusion as to who issues visas, because it used to be a Foreign Office responsibility; it is now a Home Office responsibility. UK Visas is part of the Border Agency so it reports into me, but obviously it tends to operate out of Foreign Office buildings, so if you go somewhere then you will more likely be going into an embassy or a consulate.

In a sense, that will not disappear but it will minimise in the years to come, partly because one of the big drivers we are having is on technology so that far more applications can be made online. So, with your original application, you won’t have to go anywhere; you can do it in your front room. Obviously, you will have to go and give us your fingerprints, and we are setting up networks-in some places we are setting up mobile places that will go round-to try and make it as convenient as possible for people to give their fingerprints. But obviously in policy terms the Foreign Office plays a significant role.

Q54 Nadhim Zahawi: Let me just press on that point. I think everything that is being done is absolutely right and the biometric requirements are absolutely correct, but I am sure you would agree with me that we can’t be complacent about these things. My question to you is: are your officials-because from the answer I take it it comes under your domain-as up-to-date as, say, the Foreign Office officials who, when we have gone on our trips, seem to be much more in line with the Prime Minister’s goal of wanting to use our embassies as business development hubs? I hear what you say, but some of the evidence on the ground says you are absolutely right to be much more rigorous in our application of the procedures in our country for people to come in, but there are cleverer ways of doing it. We have heard from chambers of commerce in particular countries who say, "Look, we can give you references on people that would then-" these are highly regarded people who want to come to the UK whether it be for the university or for business. Is your Department, Minister Green, the UK Border Agency people, as aware of the importance of this in terms of business development, do you believe? If you were to conduct a survey with them tomorrow, do they understand their decisions impact on business to the United Kingdom?

Damian Green: Absolutely. Striking the right balance is the daily challenge, almost the hourly challenge of an immigration officer or an entry clearance officer all around the world, and Select Committees making visits or MPs with constituents or anyone else, here are the complaints. Globally last year we had 2.5 million applications for visas to this country and we turned down 500,000 of them. That is 500,000 unhappy people prepared to complain, but the alternative is to say yes to everyone. We all know what state the immigration system has been in for some years, and we don’t want to go back to that.

Q55 Nadhim Zahawi: Or to get cleverer, at letting the right people in.

Damian Green: Precisely, but everyone you say no to is, by definition, a disappointed customer who thinks they are the right person, so you do have to say-and people turn up, even people who think they are respectable, turn up with false documents or turn up with the wrong documents or don’t fill in the form correctly. In the end, I don’t think anyone would thank the UKBA for saying, "Okay, we’ll take a risk with this person." At the most serious end of it there are clearly implications about international terrorism, and I can absolutely tell you that every one of the persons who is giving someone a visa to this country is very, very conscious of the safety and security of the people of this country. I am sure this Committee would recognise, as everyone else would, that absolutely has to be the prime thing that an entry clearance officer is thinking about.

Q56 Chair: Quite clearly, there have to be implications in terms of prevention of terrorism. I was intrigued by your comments about Schengen countries, which appear currently to have a, if you like, lower standard of security processes than we have in this country, and the implication being that other potential entrants from other countries prefer to go to Schengen for that reason. You also said that, in effect, this would be changed. Is there a programme within the Schengen countries to bring the security processes that are applicable to our visa application to the same level?

Damian Green: Yes. I mean, they say they are. I am told that the French are the furthest advanced. They won’t all do it at once, and that may be the problem for them. They have 20 countries, so setting up a proper biometric checking and recording system is not easy, and it will clearly be easier for some Schengen countries than others to do that, but it is absolutely their intention to move to biometrics in the way that we have and the Americans have. That is clearly going to be the way of the future in issuing visas. I hope they get there quickly.

It is true that the Schengen visitor visa is cheaper than our visa, but not by a massive amount, and it is a different type of visa. The Schengen visa costs £51 and it gives you one right of entry within a three-month period, whereas our visitor visa is £70 but that gives you a six-month chance of multiple entry, so you get a better and more flexible product for the more money you pay us. That direct comparison is often just done on price; they are actually significantly different visas.

Q57 Rebecca Harris: I want to go back to the issue of colleges, as a supplementary. We heard earlier from Professor Thomas from Universities UK that he felt very strongly that it was clearly in the interest of universities to make sure they were genuinely bringing in high-quality, genuine applicants, but he also acknowledged there were anecdotes sometimes from the UK Border Agency that people have turned up at immigration with an inability to pronounce the quite well established university they were supposed to be going to with a suitcase full of tools. There clearly are some errors happening in the system. We will have some bogus colleges that will close down, but is there any risk of some of our universities losing their highly trusted status, or do you think that the changes will iron out any problems they have at the moment?

Damian Green: I hope not-it is absolutely the case that there will be colleges that close down. There is a lot more than anecdotal evidence about abuse in that sector, and the key comparator is that in the private FE sector, if you like; those private colleges offering below degree level courses, we have looked at one cohort and 26% of them overstayed their visa, which is an obviously easy way. There was 26%, more than a quarter, abused the system.

The comparative figure for universities is 2%. That is obviously very, very low but it is still 2%. So there is a bit of cleaning up of the act required of universities and their students, but overwhelmingly the reduction in numbers that have come about as a result of our driving out of the abuses will come in sub-degree courses from private sector colleges, because that is where we have identified the abuse. If anything, universities ought to be enhanced because the faint taint that this gives, as I described before, around UK education for foreigners generally will, we hope, disappear.

Q58 Paul Blomfield: Very briefly, following on Rebecca’s point, we have had, as she has pointed out, robust reassurance from Professor Thomas on behalf of UUK about the procedures that they have in place to check English proficiency. There is, as I understand it, within the Home Secretary’s statement residual discretion that is going to lie with UKBA officers at point of entry to refuse on the grounds of lack of competence in language proficiency. Do you feel that UKBA officials are sufficiently trained to make that judgment or is new training planned?

Damian Green: It is a very simple judgment, which is that if somebody turns up here and requires an interpreter then the immigration officer can turn them back at the border, so you don’t need extra training for that. You can tell if somebody is not understanding you. It is in their interests to understand you so they are not faking this. They will want to have a conversation with you in English. If they can’t have a conversation with you in English then it seems to us something has gone wrong in the system and, prima facie, they cannot benefit from a high level English education. What we have said is that for people coming for university courses they need to be able to speak English at B2 level, in the jargon. That is less than a lot of universities demand of their own students in that the bottom end, if you like, of B2 is what is 5.5 on the international scale, and most universities ask for either 6 or 6.5. So we are not imposing unnecessarily onerous requirements that the universities don’t themselves impose, but basically if somebody turns up and says, "I am going to read physics at Manchester" or something, and can’t speak a word of English, needs an interpreter even to answer questions with the border officer, then clearly something has gone wrong, and at that point we will intervene.

Q59 Mr Jarvis: The new visa system will require a high level of monitoring by the UK Border Agency. Given the proposed cuts to the agency, do you have any concerns about their ability to carry out this role?

Damian Green: No, because one of the things we are doing in parallel is, as I have already alluded to, improving the system a lot so that there is far less shuffling of paper and sheer old-fashioned bureaucracy involved. One of the things that struck me in my first few weeks as a Minister when I was visiting places was just the sheer piles of paper around the place. It looked like an office from the 1970s or 1980s rather than a modern office. In all its areas, but perhaps particularly in the visa area, that is being rectified and things are moving online the way that modern companies do and modern institutions do. Over the course of the next 18 months to two years, it will become absolutely the norm for people to make applications for visas online, and that simple act in itself is an extremely radical change that means you can be quicker, you can be more reliable, you need fewer people to do the basic things. So all the efficiencies that we have seen driven into the private sector and other public sector organisations in recent years are now coming to the UKBA.

Q60 Mr Jarvis: The minimum threshold for English is to be increased. How will you ensure that world-leading students and postgraduates in certain disciplines-I am thinking about the brilliant mathematician or the brilliant chemist who doesn’t have a great command of the English language-are not refused on the basis of their command of the language?

Damian Green: That is why, as Mr Blomfield said, we established this clause in which, in very exceptional circumstances, an individual university can appeal for a named individual student to be exempt from the B2 qualification, but we have said that we expect this to be a very exceptional case. On the whole, if you are a world-class physicist, you will have a decent command of English as well. Particularly if you are a world-class student physicist who wants to benefit from an education specifically in England, it would have been slightly odd not to have invested some of your world-class skills into getting your English up to a reasonable level so you can benefit from the course. I think the number of these will be very few, but if there are individuals then the university has the power to come to us and say, "Look, we can show you how good this person is. Please can we have them here because they are going to be the Nobel Prize winner of the future?"

Q61 Mr Jarvis: Finally from me, will any of these proposals require primary or secondary legislation?

Damian Green: Lots of them will require secondary legislation, but they don’t require primary legislation. We hope to be laying the first set of laws for the changes within the next couple of weeks. There will be a phased release as we need to go through; but, no, it is secondary legislation.

Q62 Mr Ward: I want to return to China, if I might, and there are two particular aspects of this. One is the application of the visa system and the other is the consultation on the visa system. We are a little bit, I think, confused, those of us who went to China, because the experience that we had was that we were lobbied by a wide range of companies, universities, about the visa system, and it wasn’t to do with the disgruntled failed applicants; it was to do with the eventually successful applicants but which took a long, long time in many cases. First of all, a comment on that one and then on the consultation exercise. We understand the numbers, the sheer volume, and that is an indication of some success, but any response just to the quite consistent view that we received that it was a problem for many companies and, indeed, for universities wanting to send people on partnership agreements to this country?

Damian Green: It is quite difficult to respond in general, because obviously if individuals have difficulties and they come to us with their difficulties we will try and resolve them, but I understand that Johnson Matthey was one of the companies that you spoke to and made this specific complaint, so I have looked into that. They were on a business fast track scheme. We recognise the need for businesses to be able to have a responsive system, so for reputable companies like Johnson Matthey we have a fast track scheme. They are on it, and last year they sponsored 76 applications; 75 of those were approved, 68 of them within five working days, six more in 10 working days and one within 15 working days. Every one of the approvals was within our target and the vast overwhelming majority were within a week. One was refused. Those are the facts and that doesn’t seem to me to be an unresponsive system, but obviously there will be problems. As I say, we get 2.5 million visa applications a year; they won’t all go perfectly and smoothly. If companies want to come with specific complaints then they should do so, and at the appropriate level we will look at them

Q63 Mr Ward: We have an extract from the Home Affairs Committee, which I think yourself, Mr Browne, attended. Again, there were a number of questions about concerns that had been raised. I think this was about the consultation exercise, and the response I think from yourself was that it wasn’t an issue that had been raised with you within the last month or two months. Is that still the situation? Is it something that is not feeding through to yourself?

Jeremy Browne: I can’t say that there isn’t an ambassador or a foreign minister somewhere in the world who doesn’t have concerns. I can only make a broader observation, which is that when I first became a Minister about 10 months ago it was far more often expressed to me than it is now that foreign ministers or others in countries that I visited were concerned about the potential changes to the British visa system. I think that most of those concerns were based on a nervousness of the unknown, that the British Government, the new Government, had stated an intention to reduce the net levels of immigration and in some cases they were anxious that that might mean that forms of migration into Britain, which they felt were beneficial to their citizens or their country, would be severely curtailed or stopped altogether. I think as the details of the scheme have become clearer, as the Government has worked through them across Government, led by the Home Office, those concerns have largely been allayed because people’s worst fears haven’t been realised.

I can honestly say that I can’t recall a meeting I have had recently, as in recent months, where this has been the issue that has been, I am not sure even raised at all, but certainly not the dominant issue. When I speak to, for example, the Chinese ambassador, I am sure there are individual cases or areas where they may feel that we could improve, and we are always looking to improve, but it is not the headline top issue that he is seeking to raise with me.

Q64 Mr Ward: Can I just ask you then to raise that with them again, and particularly the comments, the feedback that has come from those who visited?

I just want to carry on with the issue of the consultation. We have some information sent to us by Neil Christie, who is director of East Asia NCC Education, and this is quite an interesting contribution because it was probably referring to maybe cultural aspects, differences that may occur. What he states in this is that concerns he wishes to highlight were based on the uncertainty surrounding the current UKBA policy. His words: "While public consultation is a term fully understood in the UK, the market has reacted badly and presumed the worst is inevitable"-I think you’ve touched on this to some degree-"in that it may become prohibitively difficult to acquire". This is the telling sentence: "No one, be it UKBA, the Government, the embassy or the British Council, has, to my knowledge, made any significant attempt to counter the message, which China has interpreted". Any comments on that?

Jeremy Browne: Well, I have certainly made an effort personally, but I think it is inevitable when a Government is changing its approach that people may be quick to jump to premature conclusions about the effects that that approach may have, especially if it could conceivably have an adverse effect on them. But my experience, as I say, is that these representations are made within Government. I talk on a regular basis with the Home Office to make sure that it is joined up in terms of our own Government, but also representations are made between our Government or the different wings of our Government and foreign Governments as well, and there are plenty of opportunities for them to raise concerns with us, and the other way. I don’t know if members of the Committee have tried to get a visa to go to China but it is not quite as effortless as people might imagine.

We are always having a dialogue with other countries about these processes. But I think that the countries recognise that we have to have robust systems in place, for all the reasons that Mr Green said, and I think they have been reassured when the details have emerged that some of the routes to coming to Britain, particularly higher education routes, which they value and which they feared might be restricted, that their worst fears are far from being realised. The figures appear to bear that out because the appetite, for example, in China for British higher education remains extremely high. I don’t get a sense that that will change-in fact, far from it.

Last time I was in China, I visited the Nottingham University China campus. Such is the appetite for British higher education that Nottingham University can’t accommodate all of the Chinese people who would like to study in Nottingham, so they are taking the product to the customer, if you like, because they can’t accommodate all the customers on their site on the edge of Nottingham. It appears to be the case that far from deterring people, the demand remains strong.

Damian Green: There is perhaps an unfortunate fact that when you, as a Committee, visited China we were in the middle of a consultation period, which is inevitably the period of maximum uncertainty. Certainly, our experience after we announced the work-based routes change was that those who had been most worried decidedly said, "Oh, I see, this is perfectly sensible. You can control immigration and allow the people we need for our economy in." Similarly, the reaction of Universities UK and other bodies that had been vocally worried about what was going to be in our proposals on the student visa was very positive and we are, indeed, working hard to spread that message around the important markets of the world that, "This is now the new system, so operate within that." I suspect that uncertainty, which you may well have found, was a temporary phenomenon.

Jeremy Browne: Can I add a very brief extra thought, Mr Bailey? I can’t believe there is anybody in Parliament who feels with greater fervour than I do that it is important that Britain responds to the huge changes that are taking place in the world. There is a revolution taking place in the global order, of which China is the biggest example but it is not the only example, and if I thought that the British Government’s approach to that revolution was to pull up the drawbridge and hope that we were okay in splendid isolation I would be more than happy to tell the Committee that that was a cause of alarm to me. I think that would be profoundly against our national interests. I think we have to embrace the changes that are happening and to have an outward-looking approach to globalisation, both in terms of our cultural interest and, in terms of the focus of this Committee, in terms of our national economic interest.

That is what we are trying to do with the system that the Home Office has led on in terms of immigration and visas, but the Home Office is consulted widely across Government, including the Business Department and the Foreign Office, to make sure that we are, in policy terms but also the messages that go with those policy terms, sending out a clear signal to countries like China that we do want to attract their best minds, their best students to study here; we want to develop those relationships. I hope that those Chinese students that come and study in Britain will be entrepreneurial and successful and will set up businesses, and when they want to open a European office for their business they will open it in Britain rather than elsewhere in Europe because of the type of experiences they have had studying here. So, far from us wanting to retard the process that you have all identified, I am all in favour of trying to do everything we can to recognise the changes that are taking place.

Chair: Can I make it clear-and I have to say for a personal reason I was unable to go to China-that I did have the strongest representations made to me on the return from those who did that there was a real gap in, if you like, the Chinese perception and what the Government thought its policy was on this. That trip was only three weeks ago and only last week I had lunch with the Chinese political consul who repeated the same observations that were reflected in the evidence that we had returned from China. While I totally accept your understanding of the strategic importance of China and the need to develop good relations, I understand that-could I put it to you?-that there is still a significant gap on all the evidence that we have that that has not got through to those that matter in China and who are potentially opinion informers there. But can I bring Ian Murray in, who I believe was on the trip, and I believe he has some questions?

Q65 Ian Murray: I will concentrate on China, but I think it gives us a good insight into what the perception is. It may not be the reality, and I do accept that, but with China being one of the major export drivers for rebalancing the economy it is worth looking at. I have a little bit of a list here. Maybe perhaps when I get to the end of the list I can give you the question, but we went to see the Shanghai Motor Company who have obviously invested heavily in this country; Fusan, who are looking at investing considerable amounts, particularly in construction; Huawei, who have two plants I believe in this country. We also went to the University of Nottingham, Queen Mary and Dulwich, who were particularly vociferous about these particular issues, and the University of Nottingham were really concerned that the £3.7 million a year investment they get from doing a joint approach in China would perhaps potentially be lost, mainly through post-work study visa changes and arrangements.

All of these, on top of the vice-chair of the economic committee, and, as well, many of the employees of UKTI who are based in Beijing and Shanghai, all raised visas to the extent that when we got to our last of five days in China, Brian Binley, who is not here today, but who led the delegation, had to stop people from mentioning it because it was taking up too much time. There is a real problem here and if this is happening with China, and it may be a perception, what can we do about it? One of the real practical examples is the post-work study visa changes for students who all of the companies, including the exchanges and the co-programmes that are done by the universities, mentioned would be a real detriment to what they are doing.

Damian Green: I return to my point that they were all saying that in a climate of uncertainty, because they didn’t know; they couldn’t have known. It was nobody’s fault, it was just that we only made the announcement on Tuesday so even, Mr Bailey, the person who was talking to you last week, wouldn’t have known what the actual proposals were, and if they thought that there would be no opportunity to work then that would have been a significant change. What we have done, as you will have seen on Tuesday, we announced that people who are graduates can go into graduate level jobs, which seems to us to strike exactly the right balance, that you don’t want the offer of a student visa to be essentially the offer of an unlimited work visa for a couple of years with some study attached. But, if people come here and become graduates and then want to compete for a graduate level job here, then that is fine.

As I say, it is a shame; it is a matter of timing. It will be quite interesting to go back, when it filters through what we are proposing, to see what they say, but even more importantly to see what they do. By the summer we will know how many applications there have been from China for student visas, for example, and we will be able to tell. Clearly, the anxiety you saw was entirely generated by the uncertainty of the consultation period or, as I would suspect, also had some historic element, because certainly the introduction of the points-based system, which was only two and a half years ago, let’s not forget, was a very radical change. China was one of the areas where it fell over and in parts of southern China the whole procedure had to be closed, and is indeed still partially closed, because there was the most extraordinary rocketing up of applications and it had clearly become a huge loophole. The Chinese may well feel, "Hang on, this system doesn’t seem to work," and all I could say dispassionately, because it was nothing to do with me, that it appeared to work a lot better in the second year than it had done in the first year, and we hope it will work better in the third year than the second year, as systems tend to do, and so some of that anxiety will go.

I can only repeat that lots of people will complain, in general terms, about the visa service. It is important to know what the specific complaints are: is it price; is it delays? There are things we can do things about, and obviously will do so because part of the procedure is not just saying no to the people we don’t want to come here, although that, as I say, is one prime duty, but to make sure that the people we do want to come here get a responsive, fast service.

Q66 Mr Ward: Can I just add to Ian’s point? Any one of them really but one particular company, which has a very heavy investment in this country, a Chinese company, was giving examples where a training course came up, which was imperative that one of their employees attended in this country, and that could take seven, eight weeks, by which time the training programme would have finished. But it was just that, and it was a consistent message, there were such long delays in the system, almost frustration.

Damian Green: That frustrates me as well because that certainly shouldn’t happen. As I have said, our service standard is to deliver 90% within 15 days. On any individual there may well have been some other issue, so it is obviously impossible to comment without knowing the details. I have quoted the figures for Johnson Matthey because I knew they were one of the companies you had visited. On the basis of those figures, it is hard to justify the description that you clearly all got of the system, so we do just have to look at the facts of over what period the vast majority of visas are offered. We all quite take the point that businesses need to be fast moving; if they need to bring someone in they want that visa within a week.

Q67 Ian Murray: I have just been reminded that I don’t think Johnson Matthey were one of the complainers, which is probably why you’ve got the good figures there. Can I just bring you to a specific, and you don’t necessarily need to answer this just now but it would be useful if you could drop a note to us. The international students officer at the University of Sheffield sent a rather helpful letter through, complimenting the Government on some of the changes that were being made to the visa system, but they raised two particular issues. One was with regards to courses such as architecture, which is hugely complex. I won’t read out what they have said here, but essentially the whole process of becoming a qualified architect is outwith the terms of the visa system as proposed, and wondered if you could perhaps drop a note looking at those particular issues. Also, if you could just comment on people who have already gained employment through the post-study work visa and the particular difficulties that they feel they may come under when they are already going into employment with who are very much grade one employers-Jaguar, Land Rover, National Grid, Proctor and Gamble, and so on. Can you give us a quick comment on that?

Damian Green: I can answer both those, because, yes, we recognise the point about architecture, as well as some other courses like medical courses, and so on. They will be specifically exempt from the overall time limits we have put on. We have said three years for undergraduates, five years if you want to add a postgraduate degree as well, but we recognise there are courses like architecture that just take longer. I think, yes, we recognise that and have done something about it.

In terms of those who are already here on post-study work, then the new arrangements won’t affect them. If they have gone through the system then, as it were, the previous system will apply to them. We won’t retrospectively apply the new system. The new system will come in in April next year, and will apply from then, so there won’t be the retrospective element they are worried about.

Q68 Chair: Before we move on to the issue of high-risk countries, could I just say that on this, hearing the reams of statistics poured out was, for me, an uncomfortable reminder of when we had the bankers in front of us talking about their lending statistic to small businesses? The fact is that you can quote as many statistics as you like, but there is still a perception, rightly or wrongly, that this is not working as it should do. My concern is that here we have in China what is going to be the world’s major economic superpower in years to come. Certainly, until recently, I think it is fair to say that we had good relations with them, and particularly our university and research facilities were considered to be a major attraction for people from China and, regardless of what the statistics say, this perception is changing. Could I put it to you, what are you going to do, strongly, robustly, coherently to change that perception?

Jeremy Browne: I would start, Mr Bailey, by saying that if we all go back to our constituencies this evening, the perception that Britain’s immigration system is far too onerous and it ought to be a lot more loose is not one that I would anticipate we would hear the whole time, so there are a number of considerations that need to be borne in mind about perceptions, about-

Chair: Sorry, I am talking about China, not your constituency.

Jeremy Browne: I know but it is an important point, which is that we have to have an immigration system that enjoys the confidence of the British public and is seen to work properly and be robust, and I have explained that directly to the Chinese and others.

Q69 Chair: That is a given. The fact is what I am saying is that the Chinese do not perceive it, and I am not advocating that we have a system that doesn’t do that, that is an open system. What are you going to do to demonstrate the robustness of the system that is now in place?

Jeremy Browne: What I always say is that it is important that we have an immigration system that enjoys the confidence of the British public and the person I am speaking to accepts that that is what they would wish to have in their country, and I say it is important we have a level of immigration that can be assimilated into our country and they agree that that is what they aspire to in their country as well. But, I say, given those two obvious constraints, we are an outward looking, globalised country, we are the sixth biggest economy in the world, we have lots of world-leading institutions, whether they be universities or businesses or cultural organisations, and we want to embrace the changes that are taking place in the world. As you rightly say, the dramatic rise in the importance of China is one of those changes. That is why we are enthusiastic about trying to encourage greater interchange. That is why I am keen for more House of Commons Committees to visit China, why I am keen for more businesses to go there.

One of the frustrations I had when I went to Nottingham University’s Ningbo campus in China was how few of the students studying there were British people taking the opportunity to learn more about China. I think it would be fantastic for the exchanges to be in both directions. I want to see Chinese to come here; the Government wants to see them, so if there are problems with perceptions about people who benefit from coming here, improving our cultural understanding, benefiting our economy, then we need to constantly address that, but I don’t think the statistics-

Chair: That is the point I want to get across.

Jeremy Browne: But I don’t think the statistics are irrelevant because they are the only evidence we have to go on, and the evidence suggests-I think it’s a very striking statistic that as many Chinese students study in Britain as study in the United States of America given-

Chair: At the moment.

Jeremy Browne: Yes, but given that the population of the United States of America is five to six times bigger than ours and they have many more universities than ours and they are the biggest economy in the world and we are only the sixth biggest economy in the world, if I were an American committee sitting around with two American Ministers I would be wanting to know why the British are so much more effective at communicating with the Chinese than the Americans were. That would be a good question for them to ask themselves.

Q70 Chair: This would be a fascinating seminar but I don’t want to get down this road. The fact is we must do better. That’s the point I want to get across.

Jeremy Browne: We all agree.

Q71 Rebecca Harris: At the risk of banging on about China, on Tuesday in the announcement it was announced that we would be relaxing some visa requirements for countries that are considered to be low risk, which I imagine was quite a welcome sign that would be given to those countries that are in that category. But given that we understand that two of our posts in our China, both Beijing and Guangzhou, had the highest level of fraudulent applications, is it right to assume that they are not in the list of low-risk countries?

Damian Green: Correct. There are 15 countries on the low-risk group from all over the world, but China isn’t one of them. It is all done on an entirely factual basis as to how many problems, in particular fraud on documentation, we see in applications. Obviously, it is a big step to have a lighter touch regime, so what we need to see is consistent, long-term, overwhelming reliability, in particular of documentation so we can trust in the institutions that support that documentation. For example, we ask people who come here as students to show that they can support themselves and that there is enough money around so that they are not going to come here and try and live on benefits or work illegally to support themselves. To do that you have to have a banking sector with documentation you can trust. It doesn’t obviously apply specifically to China, but I was in Pakistan a few weeks ago and saw some extremely good forged bank documents made even better by the fact they had been attested to, had a lawyer’s seal on them, which in most countries of the world you would normally take as trusted, but our post in Islamabad had discovered that this was a crooked lawyer.

You can see the lengths to which people will go to try and fraudulently get into this country and so, as I say, there are a small number of countries that are on this low-risk list. Japan, for example, is one of them. The United States is one of them-Croatia, Chile, Trinidad and Tobago. They do come from all over the world, but China isn’t one of them.

Q72 Chair: Can I just raise an issue? This was raised by Simon Kirby, a member of this Committee who went to China and unfortunately is unable to be here at this moment. He was very concerned about the fact that all the visa documentation for Chinese visa applicants to complete was just in English not in Chinese. I appreciate there is an argument that if they are to come to England to study then it is reasonable for them to have a sufficient level of English to fill in an application. But I believe that it is quite a complicated form, and do you not think it would help the cultural perception to at least have it outlined bilingually?

Damian Green: In a sense, there is a practical problem because if we allow them to fill it in in either the main Chinese languages then obviously we then need to employ teams of translators to translate it back.

Chair: Sorry, can you repeat that?

Damian Green: It cuts both ways. In the end, at the UKBA, we are either going to have to employ huge numbers of Mandarin and Cantonese speakers or have translators to translate it back, so there is a practical and cost issue about allowing that. But I take the general point very much, and so while people will have to fill the forms in in English-and, as you say, it is not unreasonable if they want to come and particularly study in this country that they can do that-we will be issuing the guidance notes in the relevant vernacular language so that people will be able to fill it in much more easily. In particular, as we move increasingly to an online system it does become much easier to fill in, in that, as with all forms, if you do it online you can then just press the appropriate button and discard what would be the next eight pages of the relevant paper-based equivalent. We hope both that we will be able to guide people through the language issue and make the act of filling in the form much easier when it is online.

Q73 Chair: I didn’t quite follow the first part of your answer about cost implications and resource implications. I would have thought it perfectly low cost, if you like, to do an English translation for any would-be applicant. Even explaining that the actual visa application should be done in English wouldn’t require any further translation.

Damian Green: Don’t forget, everyone we employ to do that type of translation would have to be at quite a high level of security clearance. This is not at all a point particularly at the Chinese, but one of the reasons why we have moved to the hub and spoke system, where we issue the visas in a smaller number of places around the world, is to stop corruption, is to stop people who are involved in the issuing process in a particular country being able to issue documents to their cousins who may well not need them, so the more control we can have centrally over that procedure then the greater the integrity of the system. The fewer people there are in the chain of taking the decision the better and, in particular, everyone who does have the capacity to ensure that somebody gets a visa has to be highly trusted, to use a phrase from another part of the immigration system.

Q74 Chair: I wouldn’t deny it. I still do not see what the problem is in having the leaflets with, say, a Mandarin translation with it.

Damian Green: The guidance is going to be in Mandarin. As I say, I take the general point and we are going to do that.

Chair: We will see how this works. Can I just bring in Paul Blomfield on departmental co-operation?

Q75 Paul Blomfield: Clearly co-operation, as I think you have indicated, is important in determining policy in an area like this and I think you made the point that the Home Office consulted with BIS. Would it not have been better for the whole exercise to have been run jointly between the Home Office and BIS, given the different approaches possibly or the different classes that each Department would view the issue from?

Damian Green: You have to have a lead Department for every document, and the trick is to have proper mechanisms for consultation and we have those. As Mr Browne has said, he is the Foreign Office Migration Minister; he and I meet very regularly, part of a regular pattern. It is not ad hoc at all. Similarly, there are, as you are aware, a number of Cabinet sub-committees on which I will sit. One of them is a growth committee, which is chaired by a BIS Minister, on which I sit precisely because we recognise the point that this investigation is about; that our immigration system and our visa system have a significant role to play in fitting into the growth agenda. It is built into the fabric of the Government that many of my responsibilities have economic consequences that we need to recognise. Obviously, one never knows what happens under previous Administrations, but my experience is that that is new, that the Home Office in previous times tended not to be particularly meshed into, if you like, the economic and business decision-making parts of Government. We have recognised the importance of, as I say, what your report is about and we are seeking to do that on a permanent basis.

Q76 Paul Blomfield: Could I follow up with a specific question on an area that is clearly one in which you have listened closely to some of the representations that have been made, which is on post-study work? Do you accept the view that our universities have made very strongly that post-study work is integral to the competitive educational offer that they are making rather than just an add-on?

Damian Green: I think it will vary, to be honest, from university to university. I think if you want to get a degree at a Russell Group university, you want to get a degree at a Russell Group university, and if you are sitting anywhere in the world you will be thrilled to be offered a place at one of Britain’s top universities. For others, it may be different, and indeed for individuals it may be different. I think it is impossible to generalise. What I can say is that we keep a very close eye on what is offered by our main competitors in this field, who tend to be the Americans and the Australians in that if people want an English language degree then those are the countries, and that our offering is very, very competitive with theirs.

Q77 Paul Blomfield: Will it continue to be in terms of the-

Damian Green: The offering, the new one, the graduate level only job. I genuinely think nobody who is coming here as a genuine student thinks, "What is an important thing to me is that I come here as a student and then spend two years afterwards stacking shelves in a supermarket." That is not the ambitious young person’s view of how their life is going to develop. That is what we have stopped happening with our new post-

Q78 Paul Blomfield: Can I just continue this for a moment? One of our top Russell Group universities is in my constituency, Sheffield, and certainly their view is that in determining whether to go to Australia, UK or the States, the opportunity for post-study work as part of the overall educational experience is crucial. I wonder, in particular, if you could explain how you have reached the £20,000 threshold under the new arrangements, recognising there has been significant movement on the issue of post-study work, because there would seem to be a case for a little more flexibility. For example, at Sheffield I am told that the mean salary at which international students are going into the market is £19,900, but in some critical areas, like science, it is under £17,000, and whether there wouldn’t be a case for a little more sensitivity and flexibility in the approach on that issue.

Damian Green: I would be very reluctant to make it easier to employ foreign graduates than British graduates, and the lower you make that level then the easier it is for them to become the sort of cheap recruits. One of the things I have been very conscious of throughout this consultation process is that we, as a Government, have responsibility to UK graduates as well and it is quite easy to think only of the foreign graduates and what suits them, and you end up in a completely perverse position where they become advantaged over British graduates, and we are determined to avoid that. £20,000 is not a huge starting salary for a recent graduate, particularly not a recent graduate of a Russell Group university. Many of them get paid significantly more than that. There is a code of practice, which we operate already for Tier 2, for work-based entrants, and our attitude to this will be based on that set of codes of practice. Obviously businesses, industries, professions are variegated and the entry level salary for a graduate engineer may be different from a graduate working in the retail sector or whatever, and our codes of practice recognise that. We recognise that you can’t have a one-size-fits-all solution, but I am very concerned that we don’t end up with a perverse effect of allowing employers access to cheap, intelligent labour, but only if they are not British. I don’t think any British graduate would thank us for doing that, and that is what we are trying to avoid.

Q79 Chair: I am sorry if I have got this wrong, but my recollection is that earlier you said there had to be a lead Department on every document.

Damian Green: Policy area, not every document. We clearly produce joint documents, but in a policy area it will be the norm to have a lead Department and the lead Department on visas is obviously the Home Office.

Q80 Chair: I was just going to point out the plan for growth had HM Treasury and BIS as the Departments for it. I won’t ask you which you thought was the lead Department in it.

Jeremy Browne: Can I just add very briefly and anecdotally, from my observations of this process as a non-Home Office Minister, is I would be surprised if anyone in the Home Office felt that the other Departments had had insufficient opportunities to contribute their thoughts. I have sat in meetings where Business Ministers, Arts Ministers, Welsh Office Ministers, Scottish Office Ministers, Foreign Office Ministers have all been relaying their ideas and concerns and areas for potential improvement. So, one criticism that can’t be made, I think, of this process is that it suffered from insufficient consultation within Government.

Damian Green: And outside Government. We had 31,000 responses to the consultation, and it was a genuine consultation. The final document is not the same as the consultation document, and that is a good thing; it is better for it.

Chair: Can I bring in David Ward on UKBA policy and the National Audit Office report?

Q81 Mr Ward: Just one last thing on the consultation. A simple yes, I think, would help us move things forward, in that thought will be given to the consultation exercise to see what lessons can be learned from it.

Damian Green: Of course, but if the lesson you are seeking to draw is that we should do less consultation and just decide as Government, I don’t agree.

Q82 Mr Ward: No, I am referring particularly to the feedback that we have had in the China experience in terms of the perceptions that we hope, and are assured, were false perceptions, but did nevertheless have an impact on the contributions that were made to us on the trip.

Jeremy Browne: The Prime Minister, no less, made a speech at a university in China when he visited, so attempts are being made at every level of Government to demonstrate Britain’s willingness and openness to further better economic integration with China, but change in perceptions of 1.3 billion people is an ongoing task.

Damian Green: Very specifically, only four national Governments responded to the consultation. One of them was the Chinese Government, and their main concern was about retrospection on the post-study work group, which we have addressed, so the Chinese Government itself took part in the consultation.

Q83 Mr Ward: If I went into the Idle Working Men’s Club, which believe me does exist, about 70 miles from where I live, and spoke to them about immigration, I don’t think they would even think about international students as being immigrants. Obviously, we have focused very much on students today, but UKBA estimates that there may be up to 181,000 migrants in the UK of all visa types whose permission to remain has expired, and that is since December 2008. There is an argument that we should be focusing far more on that than some of the issues we have been discussing today.

Damian Green: There are two points there, both of them entirely valid. Are students migrants? Yes, if they stay for more than a year. It is not my definition; it is the UN’s definition. The definition of an immigrant that all Governments around the world adhere to is somebody who comes and stays in a country for more than a year. The Home Affairs Select Committee issued a report last week saying, frankly, we shouldn’t count them. It is jolly tempting as Immigration Minister: we can define away the immigration problem and just say, "Well, that lot don’t count as immigrants any more. Great. I can put my feet up," but I don’t think that would be very credible. I think we need to stick to the international definitions and not attempt to fiddle with the figures.

The number of people who have, as it were, disappeared from the system or who we have no knowledge of, absolutely that is not good enough, and that is one of the reasons why we are doing so much to improve the systems of checking of who comes in and who goes out, and across the board we are doing that. We now take the biometrics of everyone who comes into work. To work in this country if you are not British you need a biometric resident’s permit, so you have a document that has your fingerprints on it that you need to show to an employer. That helps.

We are proceeding with the e-border system. There have been problems with the previous contractor, as the Committee will know, but we are carrying on with that and we do count out, as well as in, a very significant number of people under that system. The other big computer project we have inside the UKBA, the integrated case work system, is precisely going to computerise everything that used to be manual, those piles of folders I talked about. Over the next couple of years that will be introduced into different areas. Then you will have systems that will talk to each other so that we will know, first of all, that you presenting yourself are the person you say you are on your documentation, that we know when you came in, we know how long your visa is for, and we will be able to tell whether you have left or not. That is the end point that we are all seeking for. I would love to be able to pull a lever to say that is going to happen from tomorrow or, even better, yesterday, but I am realistic about changing big computer systems, which is what a lot of this involves, and it will take a few years. But absolutely we are driving towards that.

Q84 Paul Blomfield: While clearly the UN have a definition of migrants, do you think it wouldn’t have been helpful in terms of the public discourse and policy debate for us to draw a clear line between those who may technically be defined as migrants but are in fact students and genuine migrants in terms of where people perceive immigration policy?

Damian Green: No, I don’t, for two reasons. First of all, because I think politicians announcing, "I’m changing the figures" just induce even more cynicism about politics than has happened in the past. Secondly, and very importantly, lots of them do stay. We have done a big in-depth study, called The Migrant Journey, on the 2004 cohort and we discovered that of those who came as students in 2004 more than a fifth were still here in 2009. So they are not just coming here doing a course and then going home; a fifth of them stay long term, and after five years they are eligible for various other privileges.

Indeed, the next exercise we are going to go through in the early summer is a consultation on the link between temporary migration and permanent migration because we want to make it much clearer to people, as other countries do, whether the visa you come in on is designed to be a temporary visa or might lead to permanent settlement. At the moment we make no distinction about that, so it is quite possible for people to come here and shift around categories, and suddenly they have been here long enough that they have the right to settle here. Fine, we want, as I say, the right people to come here and settle here and so on, but we want to know throughout that process whether they are aiming at that or whether they can aim at that under their current visa. I think this distinction needs to be much better than it has been in the past.

Q85 Chair: Can I just clarify? I think that you commented that 20% were on further visas and 3% were on settlement. Is that correct?

Damian Green: Yes. There were lots of figures in that but the key one is that 20% were still here after five years, 3% had already become settled. That was a startlingly high figure that-

Q86 Chair: But presumably a proportion of those 20% who were on further visas might well go back at the end of them.

Damian Green: They might. Some of them probably were here overstaying, but I am not suggesting that the bulk of them were doing anything illegal. I am merely pointing out that the system as it stands allows people who people will say from a sort of commonsense perspective, "Well, they are students; they are not migrants. They come here and they go after they finish their course, after one, two or three years." Well, loads and loads of them don’t. I am not talking about 20% of a small number. That is 20% of about 300,000 people. If we added up last year’s students, plus the dependants they brought in with them, that is 300,000 people. So you are talking about significant numbers of people here.

Q87 Mr Ward: There are two questions, but we have covered them before, I think. The first one is just another example. This happens to be Airbus, but it is about problems with the system: trying to bring in experts to work with engineers, it took seven weeks to get a response to a phone call and the delay. I mentioned this earlier on with Chinese companies wanting to come here. It was just a question around that, but I think we have covered that in terms of responses that you made before. It is just another example of the system seeming to fail some of our companies.

Damian Green: If companies are finding it takes seven weeks to get a phone call replied to then escalate it, take it to a senior person in the UKBA. In the end get hold of your MP and escalate it to me, because that shouldn’t be happening, if that is happening.

Q88 Mr Ward: The final question was again something we have touched on, but it was to do with the unified EU visa. This was in fact comments made by various Chinese that we met and that was if you come here and then you want to go to Germany or Italy, or wherever it may be, each time you have to then have a separate visa. I think we have already covered that in terms of other countries in Europe where that doesn’t apply.

Damian Green: Yes, if you are a member of the Schengen group that is the advantage for you-that people can travel to other members of the Schengen group without any checks. As I say, it is an advantage in terms of free movement. It is a disadvantage in terms of border security and successive British Governments have taken the view that we don’t want to make our borders any less secure; indeed, we want to make them more secure. That is why we haven’t joined Schengen.

Chair: I think that concludes our questions. Thanks very much, Ministers. Obviously, we hear what you say. I appreciate that things may have changed post the statement on Tuesday. We will monitor the impact of the changes very carefully, and we will also continue to find ways of monitoring the perceptions abroad for its potential impact on business in this country. But in the meantime, thanks very much. We may see you again.