What effect will the Spring Budget 2023 have on UK immigration?

The chancellor of the exchequer delivered the Spring Budget on 15 March 2023, with his stated priority to grow the economy. This includes increasing the labour supply to ensure the UK attracts global talent. The government aims to help businesses tackle labour shortages and expand what is permitted under the business visit arrangements. 

While the aims and intentions of the government seem promising for business, the policies may not be as productive as intended. 

Easing labour supply shortage

To ease the labour supply shortage, the government commissioned the Migration Advisory Committee (MAC) to assess the Shortage Occupation List (SOL) for the construction and hospitality sectors. 

The government accepted MAC's recommendations to initially add five construction occupations to the SOL. The occupations to be added are: (1) bricklayers and masons; (2) roofers, roof tilers and slaters; (3) carpenters and joiners; (4) construction and building trades not elsewhere classified; (5) plasterers. 

This is due to take effect before the summer recess. The government will review the SOL regularly and base their decisions from the MAC to enable the legal migration system to be quicker and responsive to the business and economic needs. 

Remaining obstacles

While the changes to the SOL seem positive, given the well-documented struggle of these sectors, migrants who wish to come to the UK under the newly-permitted construction occupations will still be required to satisfy the Immigration Rules. 

These rules require migrants who wish to apply for a Skilled Worker visa to satisfy the English language requirement, meet the minimum salary thresholds and for employers to pay the (often prohibitive) fees associated with visa applications. 

There is no mention of reduction in government fees for those applying under the new construction sector. While many businesses have shortages in labour, they simply may not be able to locate suitable candidates, pay the salaries required nor afford the government fees attached to the sponsored visas. 

It remains to be seen whether these changes will serve their intended purpose once implemented.    

Simplification of business visitor rules

It is hoped that one positive step of significance will be the policy to simplify business visitor rules to enable visitors to conduct a wider range of business activities in the UK without needing work permission. 

So far, the announcement has confirmed this will involve expanding the range of short-term business activities that can be carried out and review permitted paid engagements, with the changes due to be implemented from autumn 2023. 

Businesses will need to thoroughly review the expansion of the range of the business activities and permitted paid engagement to determine exactly what will be considered as permitted paid engagement or permitted activities as a business visitor, so that the visitor is not regarded as working illegally in the UK. 

Osborne Clarke comment

While these moves sound positive, the scope of these changes is not yet clear nor is the benefit this may ultimately provide to businesses with a mobile workforce. 

It is hoped that the permitted activities will increase to cover almost all intra-corporate activities, as well as helping to facilitate staff of overseas companies conduct their business with UK clients.

However. these changes will coincide with the implementation of the Electronic Travel Authorisation scheme, so while red tape is reduced with one hand, it will increase with the other.

Read more about the tax announcements made and the implications of the budget for employers and for the life sciences sector.

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