Labour will relax immigration rules to boost growth in a renewed push for business support, Sir Keir Starmer is set to say, after Rishi Sunak rebuffed the Confederation of British Industry’s (CBI) call for greater access to overseas workers.
In a speech to business leaders on Tuesday, the Labour leader will put his party at odds with the government on the key battleground issue, saying his government would be “pragmatic” on migrant workers as part of a national “strategy for growth”.
But he will tell the CBI that any easing of restrictions must be matched by commitments from employers on better training, pay and conditions for homegrown staff – to end the “cheap labour” model for growth and wean Britain off its “immigration dependency”.
The head of the UK’s biggest airport group said on Monday that there was “no doubt” that Brexit had damaged the economy and had “massively exacerbated” labour shortages.
Charlie Cornish, chief executive of MAG, said the aviation sector’s ability to recruit workforce “at scale and at pace” had been harmed. “Pre-Brexit, that problem was never there.”
It comes after Mr Sunak dismissed reports the government was considering a Swiss-style deal with the EU to remove barriers to trade, which would involve a return to greater freedom of movement for workers.
After Tory Brexiteers erupted at the proposal – and Nigel Farage branded it a betrayal that would see Conservatives “destroyed” at the next election – the prime minister insisted he was “unequivocal” that under his watch the government would not pursue “any relationship with Europe that relies on alignment with EU laws”.
But business leaders said Mr Sunak should “open his mind” and recognise that the deep economic downturn forecast last week by the Office for Budget Responsibility makes a closer relationship with the EU vital for Britain.
The vice-chair of the Northern Powerhouse Partnership – former Siemens UK chief executive Juergen Maier – told The Independent: “The thing that’s so difficult for business people to understand is that ideology is getting in the way of economic pragmatism.
“We need to be able to have a conversation about alignment. A better model is fuller access to the single market, whether it’s done by EEA (European Economic Area) membership or a bespoke arrangement. It’s time to open the mind and truly listen to business.”
The chief executive of the British Meat Processors’ Association (BMPA), Nick Allen, said a Swiss-type arrangement would be a “sensible” way of removing checks at the borders.
“Sooner or later we have to confront these ideas and consider them,” he said. “We’re not seeing any benefits from Brexit and we need some new answers.”
On Monday, CBI chief Tony Danker called for more fixed-term visas to help “plug the gap” of around 1 million vacancies in the UK economy. He warned that businesses considering investing in the UK need more detail “as soon as possible” about how the PM intends to boost growth.
Speaking to the CBI, Mr Sunak said he wanted to create “one of the world’s most attractive visa regimes for entrepreneurs and highly skilled people”.
But he gave no ground on the points-based system controlling migration for lower-skilled workers, saying that his “number one priority” was tackling illegal migration.
By contrast, Sir Keir is set to tell the CBI a Labour government would be “pragmatic” on the recruitment of labour from overseas.
But he will add: “Any movement in our points-based migration system, whether via the skilled occupation route or the shortage worker list, will come with new conditions for business.
“We will expect you to bring forward a clear plan for higher skills and more training, for better pay and conditions, for investment in new technology.”
Aides said Labour would not return to free movement and would keep the system under which points are allocated to would-be migrants according to the demand for the skills they offer.
