New immigration regime is chaotic, confusing and costly

On 5 December 2007 the UK Home Secretary announced significant changes to our immigration regime. "Migration brings great social and economic benefits to this country," said Jacqui Smith. Not so, according to a House of Lords committee report published last week, which could find no evidence to support her claim.

Immigration Minister Liam Byrne, who has rejected Conservative demands for a cap on immigration, is adamant that the new points-based system is a better solution. But managed migration, as the new regime heralded, is a misnomer. Far from introducing new controls, much of the responsibility for managing the new system will be passed to employers - or 'sponsors'.

The current 80-plus categories of immigration will be condensed into five tiers. Tier 1 comprises highly skilled migrants who will not require employment offers and will have unrestricted access to our labour market. An online registration system is now in place for employers who wish to be sponsors - the only part of the proposals that has been introduced within the target timeframe of 100 days. We still have no implementation date or draft regulations for the rest of Tier 1 or any of the others.

For Tier 2, comprising skilled workers, the fundamental change will be to require employers to register as sponsors, prove that they are bona fide businesses, and maintain a licence. Tier 3 is low-skilled workers needed for specific, temporary labour shortages. Applications, made through sponsors, will only be available to migrants from countries that have comparable effective return arrangements. Tier 4 covers students, who must have been accepted by an approved educational institution acting as the sponsor. Tier 5 is youth mobility and temporary workers, who will be allowed to work for a limited period to meet primarily non-economic objectives. They, too, will require sponsors.

The compliance and reporting obligations are onerous. Employers will have to report to the Border and Immigration Agency within 10 days if a migrant worker has been absent for 10 days without permission. Employees will have to appoint authorising officers, who must take responsibility for reporting to the agency. Employers who do not have adequate HR systems in place may be refused a certificate of sponsorship or have their status as sponsors downgraded.

Entry clearance will be carried out by officers in the overseas consulates, who will check that the employee is not a criminal or potential terrorist and that the employee's sponsorship number matches that of the registered employer.

The cost of bringing in workers from overseas will increase dramatically. There will be a fee to register as a sponsor, another to renew the licence, another for the certificate of sponsorship and increased fees for entry clearance.

There are many questions still to answer. For example, how will the Border and Immigration Agency ensure consistency of approval? Will employers have to pay interview costs, including travel expenses? What rights will employers have to challenge their sponsorship status if they have been downgraded or if mistakes are made in the vetting process? What rights will employees have if their employers misinform the authorities about their activities?In the global marketplace, where an employee works is increasingly difficult to pin down. The new system does not address the needs of internationally mobile workers who may need to work for short periods in a number of countries. They will have to try their luck as visitors when they are neither visitors nor employees in the UK, but somewhere in between.

One sure prediction for the new system is chaos, confusion and extra cost. The Home Secretary's 100 days expired on 14 March. She still has a great deal to do.