www.appgmigration.org.uk APPG Migration Briefing 11, 20 March 2013
Learning from the past, planning for the future:
Immigration from Romania and Bulgaria from 2014
Summary of points
This paper reviews the available evidence about EU migration to the UK, highlighting following key points:
1. In January 2014, restrictions on A2 nationals’ access to the UK labour market will lift; it is not known how many A2 nationals will come to the UK after this date.
2. Evidence about past immigration from the EU shows that ‘A8’ nationals made a net fiscal contribution to the UK, although the local community impacts were varied.
3. A measured, evidence-based strategy, which looks beyond restrictions to the UK welfare system, is needed from parliamentarians, local authorities and civil society in order to prepare for the changes.
A2 nationals in the UK
On 1 January 2007 Bulgaria and Romania (‘A2’ countries) joined the European Union (EU). Since this date, nationals from these countries have benefited from the rights of free movement. Transitional restrictions have been in place since 2007, limiting A2 nationals’ right to access the UK labour market. A2 nationals have been restricted to skilled employment in the UK, or working under two quota-based programmes for the agricultural and food processing sectors (Migration Advisory Committee, 2011). A2 nationals have also been able to reside in the UK as a self-employed worker, a student or a self-sufficient person.
In 2011, data indicated that 141,000 A2 nationals lived in the UK (Migration Observatory, 2012). 21,250 places have been available for A2 national workers per year under the Seasonal Agricultural Workers Scheme and 3,500 under the Sectors Based Scheme for the food manufacturing sector.
The UK, alongside other EU member states, will remove the transitional restrictions affecting A2 nationals on 1 January 2014. This will mean that they have the same rights to work and to access the UK social security net as any other EU national here.
Politicians and media commentators have in recent months expressed concerns over the potential impacts of lifting the transition restrictions on A2 nationals in 2014. A number of UK Parliamentarians, as well as local authorities, have requested estimates for the number of A2 migrants likely to immigrate to the UK in 2014. Government ministers have so far refused to produce forecasts or any other anecdotal evidence on these requests as the ‘figures are unlikely to be reliable due to many variable factors’ (Hansard, 2013).
Debate about the impacts of lifting the transitional restrictions on A2 nationals has also focused on the implications for the UK’s public services and welfare system. There has also been discussion in Parliament about how far the Government should be seeking to address labour standards in low-paid sectors which may see increased immigration from A2 countries after 2014, in order to address potential exploitation.
Learning from 2004
Although there are considerable differences in the circumstances, analysis of previous immigration of nationals from the A8 member states may offer some useful lessons from the past. In 2004, the EU had its largest enlargement with the accession of the Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary, Malta, Poland, Slovakia and Slovenia. Only the UK, the Republic of Ireland, and Sweden, allowed full access to their labour markets for nationals of the eight new Central and Eastern European member states (the ‘A8’ countries). All other EU member states implemented transitional restrictions on A8 nationals.
After the 2004 expansion of the EU, the UK received a substantial number of A8 migrant workers – considerably higher than had been expected. Research suggests that, of the three EU countries to have opened their labour markets to A8 migrants, the UK’s greatest pull factors in 2004 were its ‘large economy and flexible labour market’ (Migration Observatory, 2013).
Analysis shows that, overall, A8 migrants coming the the UK after 2004 have made a net fiscal contribution to the UK (Institute for Fiscal Studies, 2010), with no negative impact on the UK welfare system. This is because, overall, the evidence points to ”
a very positive picture of A8 immigration to the UK – one of highly educated, young people, entering the UK predominantly to work, with subsequent positive net contributions to the tax system” (IFS, 2010).
Research into A8 nationals who were eligible for social assistance shows that they were less likely than their UK counterparts to claim welfare benefits after coming here in 2004 – according to the Institute for Fiscal Studies, A8 immigrants coming to the UK after 2004 were 59% less likely than natives to receive state benefits or tax credits (IFS, 2010). Although there was considerable concern about the impacts of lifting transitional restrictions on A8 nationals prior to May 2011, there has been no evidence to suggest that there has been an increase in A8 benefits claimants since this date.
Other evidence relating to the 2004 enlargement does, however, suggest that considerable local impacts may
www.appgmigration.org.uk APPG Migration Briefing 11, 20 March 2013
arise from substantial immigration following enlargement. Many A8 migrants worked in exploitative conditions within low-skilled sectors, and evidence suggested some small-scale undercutting of local workers at the bottom end of the wage scale (Dustmann et al, 2009). Labour exploitation is already known to be widespread in relation to low-paid A2 workers within sectors such as construction (UCAAT, 2011).
More widely, the 2004 wave of A8 immigration has had impacts on communities across the country, with implications for local public services and community cohesion. This suggests the importance of responding quickly to potential social and demographic developments and, where possible, anticipating changes in advance.
Planning for the future
It is likely that, following the 2014 lifting of transitional restrictions, there will be some increase in immigration from the A2 countries to the UK. Researchers have pointed to a number of reasons why levels of immigration to the UK from A2 member states may be more manageable than some media reports have suggested.
Currently, ten EU member states, including the UK, France, Germany and Italy, maintain transitional restrictions for A2 nationals. However, all will be required to lift these restrictions in 2014. This means that the UK will be far from the only possible destination for A2 nationals after this date. It is likely that some A2 migration will follow established patterns, relating to language, cultural and familial networks. Spain and Italy, for example, have thus far received the highest proportion of Romanian migrants in the EU and it is likely that substantial movement of Romanians in 2014 will be directed to these countries rather than to the UK (Migration Observatory, 2013).
The economic climate in the UK is also likely to have a bearing on A2 immigration. When reviewing the extension of transitional restrictions on A2 nationals research by the Institute for Public Policy Research shows a decline in immigration from A8 countries over the past five years as a result of ‘worsening economic conditions in the UK’; in 2007 over 100,000 A8 nationals came to the UK, but this figure dropped to 62,000 in 2012 (ippr, 2013). This may point to a further disincentive for potential immigrants from A2 countries in coming to the UK.
The unpredictability of post-2014 immigration from A2 countries creates difficulties for politicians, local authorities and civil society in anticipating its potential social, economic and demographic implications. Will there be negative impacts on the UK labour market, benefits system or communities, as well as for A2 nationals coming here?
View from the Romanian Embassy:
Dr Ion Jinga, Romanian Ambassador to the UK
“We are aware of the arguments of those who fear a “flood” of Romanian and Bulgarian workers starting with January 1st. However … we highly doubt that the lifting of restrictions for Romanian workers, on January 1st 2014, would lead to any significant increase in the number of Romanians coming to the UK.
On the contrary, I believe the effect of lifting restrictions will actually prevent exploitation, ensure a fair, non-discriminatory treatment for Romanians already working in the UK and bring an additional contribution to the British Treasury through a more efficient tax collection.”
Dr Ion Jinga, Ambassador of Romania to the UK
The Daily Telegraph, 21 February 2013
The Government has focused its attention thus far on addressing public concerns about the potential impacts of A2 migration on the UK welfare system, although there is little evidence about how far A2 nationals would be expected to access benefits or services here. The Immigration Minister, Mark Harper MP, has committed to coordinating work across Government departments to focus on cutting out ‘abuse of free movement and address pull factors, such as access to benefits and public services’ (Hansard, 2013).
In response to an urgent question from Frank Field MP in March 2013 on restricting benefits to A2 migrants, the Work and Pensions Secretary Iain Duncan Smith stated that his department will be reviewing the Habitual Residence Test (HRT) and the length of time EU migrants are resident in the UK, as well as access to social housing.
There are considerable concerns about the potential labour conditions for A2 nationals coming here to work. The light touch regulation in place within many low-paid sectors where A2 nationals might be expected to work (such as agriculture, hospitality, cleaning and care work) could contribute to higher levels of exploitation of A2 nationals after January 2014.
There is also a need for a strategy aimed at promoting a calm and cohesive response among wider communities to the arrival of A2 nationals after 2014. This could involve local schools and authorities engaging in joined-up thinking, alongside Government and civil society, to prepare for any potential demographic changes and the resultant social impacts.
For further information contact:
PPG Secretary / MRN Public Affairs Officer
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