Rise in migrant visa fees will stoke inflation

Only three days after our first press release warning that the cost of recruiting badly-needed overseas workers is stoking food price inflation, the government has made matters a whole lot worse.

In an address to Parliament, Chief Secretary to the Treasury, John Glen announced the following, which is intended to raise revenue to pay for public sector pay increases:

• Immigration Health Surcharge – up over 65% from £624 to £1035
• Work and visit visas – up 15%
• Certificates of sponsorship, settlement, citizenship – up “at least 20%”

It’s the government’s contention that this will not be inflationary, but as Nick Allen, CEO of the British Meat Processors Association explains: “we know that many private employers are having to foot the bill for these charges to incentivise workers to come to the UK. These extra costs get passed on down the supply chain and end up increasing the cost of the goods and services that overseas workers produce.”

Even if the extra charges are to be borne by the workers themselves and not covered by their employer, the UK will become much less attractive as a destination for overseas talent, and the UK labour market will become even shorter of the skills and workers needed to grow the economy.

We’re yet to hear a time frame for introducing these price increases.