So how will this cap on immigration work?

LONDON, 14 MAY 2012 – Global investment bank MorganGoldensacks this morning threatened to move its entire operation out of the United Kingdom after it was refused permission to relocate staff from New York, Singapore and Hong Kong to its London office. The bank’s management hit out at excessive government regulation after falling foul of the new immigration rules brought in by David Cameron’s government last year.

MorganGoldensacks had planned to set up a new team in London to take advantage of the rapidly growing Black Hole Derivatives (BHD) market. Black Hole Derivatives are complex financial instruments designed to exploit the loopholes in the international banking regulations brought in after the 2011 G20 summit. Over the past year, London has established itself as a major centre for trading in BHDs but investment banks are warning that its position is now under threat.

As Bradley Smythe-Hoover, head of derivatives at MorganGoldensacks explained:

“BHDs are highly complex instruments. The analysts and traders who work in this field are our brightest people. It’s not something just anyone can do. The BHD market is constantly changing and the creativity needed to stay ahead of the game needs people to be in one place so they can bounce ideas of each other. We wanted to bring them all together to create that critical mass. We hoped to be able to do that in London. Now we will have to look somewhere else.”

A combination of factors has meant that, five months into the year, the 2012 immigration cap has already been reached. Unemployment has fallen rapidly as the economy has improved and ideal weather conditions have caused farmers to bring in foreign workers to prepare for a bumper harvest. There has been little interest from local people in jobs at the Olympic Games, so London 2012 sent out an urgent appeal for migrant workers in January. The annual cap on migrants was reached a few days ago when EasyTandoori, the joint venture between Stelios Haji-Ioannou and Gulam Noon, brought 500 Indian waiters and kitchen staff to the UK, in preparation for the opening of its restaurants later this year.

These explanations cut little ice with Mr Smythe-Hoover.

“The bottom line is, if we can’t bring our people into the UK, then we will take our people in the UK and move them somewhere else. Other investment banks are in a similar position. This is a serious threat to London’s status as a major financial centre.”

The cap on immigration was one of the Conservative Party’s flagship policies in the 2010 general election. Any attempt to water it down would be seen as a humiliating climb-down. The investment banks are privately furious that the policy has been applied to their staff. There is talk in the City pubs and wine bars of a mass exodus to Switzerland, New York or the Far East.

The Conservatives were preparing for some tough battles when they took office but they probably did not expect to pick a fight with the investment banks. The future of the government’s immigration policy may depend on who blinks first.

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4 Responses to So how will this cap on immigration work?

  1. Pingback: So how will this cap on immigration work? - Rick - HR Space

  2. Pingback: ‘Labour’s electoral strategy’ – and a call for Empiricism « Freethinking Economist

  3. marinda says:

    Well said and a very good example for what the future holds for Brittain. A new Brittain. One with a cap.

  4. inspector says:

    New Immigration Law of Australia turns millions of Asian Students’ hope who graduated from local university with high education degree into dream:

    So far, since 1 July, 2012, Australian IMMI has introduced a new way to rule the immigrants called “Skillselect”, which is similar to the “refugee” processing system.

    There are several critical points need to be aware:
    1. You are unable to submit any visa application actively if you go through points system.
    2. You need to address your interest by submitting some information to the system and waiting for the ranking system. just like the day we were in high school, the system will rank you from highest point to the lowest point.
    3. The occupation ceiling, that says in each year, there are only certain number of applicants with highest points will have the chance to be invited by the government or state to apply for the visa if your occupation is on the demanded occupation list. for example, the occupation ceiling for project manger is 1500 this year, if submit your interest early after July, and your points you claim is as high as possible, and within the top 1500 ranks, you are likely to be invited to apply for visa. otherwise, a basic 60 points of you is unlikely to be invited. in fact, you gotta know there are heaps of people want immigrate to australia. it’s not like apply as you could before July.
    4..Meanwhile, the circumstances for skills students going through points system is further harsher than ever before, the another path via employee sponsorship is as easy as possible, the english requirements is as low as 5.0 on each of IELTS, with 2 years working experience of vias 457.
    5. another fact is that the english requirements for going point system is as minimum as 7.0 which is saying even if you are from english speaking country, if you want to claim 10 points, you must pass IELTS test and achieve 7.0 on each. that being said, the english requirements to a non-english speaking resident is even harder than the english speaking resident. the question arise here is that is it really necessary for a worker to get 7.0 in order to work in the market? is it reasonable? or just red tape? as far as i know, there are many workers living in australia without a high education degree and IELTES 7.0 still can work without a problem. why the australian immi is so fussy with skills students.
    6. it is expected that the new immigration rule will damage the australian education industry, and australian hospitality reputation, given that the new rule simply indicates simpley come to australia finishing a high education degree and then migrate is mission impossible. and it is not worthwhile to study in australia, because the tuition is extremely expensive, and no work opportunity for foreign students, spectacularly if you are from asia, you are unlikely to find a job in local market given that 98% of aussie employers only hire aussie, and discrimination against asian people in australia is illegal but ubiquitous.
    7. if you are too lucky to find a work contract of 2 years, the employer sponsors you, and your IELTS test is 7.0 on each item, and you live in regional area like Perth, and sponsored by a state, that saying total points 75 is like to get your visa secured

    In summary, if you are an international student from Asia, and you want to immigrate to australia after you paid $60,000 two years course fee to useless australian university for a master degree, it is just a dream! Australian immi is more prefer low sill workers such as caravan park manager, life guard rather than knowledgeable master degree students. it is understood the high education qualification at local is useless, over-qualified, not appreciated, under-estimated, and undermined.

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