Slowly does it

It seems a little churlish to expect someone not to gush with enthusiasm in their own press release. So here, quoted in full, is Kevin Foster MP, until September ‘minister for safe and legal migration’, launching a new business visa route in August.

‘Rapidly growing businesses, like small enterprises, tech and financial services, need the right level of support to go to the next level,’ Foster said. ‘Through our Scale-up visa, we’re enabling businesses to focus on their growth and innovation by giving them more freedom to bring in the diverse skills and experience they need, making them more attractive on an international stage.’

Foster added: ‘By supporting our high-growth tech, financial services and small businesses, we are ensuring the UK remains a global hub for emerging technologies and innovation while enhancing productivity across the economy – creating jobs, growth and prosperity across Britain.’

Lawyers have become accustomed, through successive governments, to a mismatch between rhetoric and delivery on immigration. But the gap here stands out as particularly wide.

‘The Scale-up visa route is another example of the government prioritising rhetoric over substance,’ observes Kerry Garcia, Stevens & Bolton’s head of employment and immigration. ‘This was introduced to assist fast-growing UK businesses in attracting top talent from abroad. It requires the company to have an annualised growth of at least 20%, among a long list of other complex requirements… the process is lengthy, costly and cumbersome. This is evidenced by the fact that only one company is currently listed as having a Scale-up sponsor licence.’

From 9/11 to war in Ukraine

Some lawyers advising on business immigration say one must go back to 2004 to find a period when their area was not treated as a political football. Three years previously, the initial response to the 9/11 terrorist attacks on New York was a relatively liberal immigration regime with a good level of service attached. It was part of a spirited effort to get the world economy going again.

Then, in 2004, two Labour ministers – David Blunkett and Beverley Hughes – were forced to resign: Blunkett as home secretary for interfering in the visa application of the nanny of his former lover; Hughes as immigration minister after she misled the Commons over her knowledge of an alleged visa ‘scam’.

The Blair government’s response to these personal failings was to double down with tougher rhetoric on immigration, and policy changes that referenced the public’s ‘legitimate concerns’. Blair’s new home secretary, Charles Clarke, ushered in the first of several systems introduced since then that have claimed to be ‘points-based’.

But while points-based immigration systems are supposed to be independent, in practice they are subject to interference that takes the form of policy changes to the available routes/tiers – changes that are often implemented with little notice.

With change comes disruption, not least because the Home Office operates a very low wall between case management of business immigration on the one hand, and asylum on the other. Fast forward to Russia’s invasion of Ukraine, and the flimsy divide between the two became evident.

As Russian troops massed on Ukraine’s border, Zeena Luchowa, associate partner at Laura Devine Immigration, says the Tier 1 (Investor) route was closed ‘over security concerns’. It had been a popular route used by rich Russians, some with allegedly close links to the Putin administration.

‘While the Home Office has indicated that upcoming reforms to the Innovator route will incorporate an element of investment options, these have yet to come to fruition,’ Luchowa says. ‘Most provisions from the now closed Representative of an Overseas Business route have shifted to the Global Business Mobility – UK Expansion Worker route. This provides greater flexibility for those coming on a short-term basis as there is no English language requirement, but does not lead to settlement (indefinite leave to remain), which may deter applicants.

‘A number of priority and super-priority services were suspended for months around the summer, partly due to pressures caused by the Ukraine crisis and reallocation of resources within the Home Office.’

Chris Harber, head of immigration at Boyes Turner, says: ‘The Home Office has always struggled for operational capacity. This is nothing new. The [department] has had several years of operational challenges.

‘Understandably, the Home Office faced significant strain shortly after the Russian invasion of Ukraine due to the need to quickly implement visa routes for Ukrainian refugees to come to the UK.’

The Home Office came in for fierce media criticism over its handling of the refugee crisis, and in response diverted resources from other visa routes to process Ukrainian applications as quickly as possible.

Harber says: ‘The knock-on impact of this decision was that processing times for work-based visa routes significantly increased during that period and have taken a long time to return to something resembling normality. Indeed, the Home Office took the decision to suspend all priority routes for visa applications shortly after the invasion, and they only came back online towards the end of the summer.’

Impact on growth

Delays and uncertainty in business immigration cases have a tangible impact on the economy. ‘The Skilled Worker visa category suffered significantly as a result of these disruptions,’ says Harber. ‘We have seen countless situations where businesses have not been able to hire the staff they need quickly enough, purely because of Home Office processing times.’

He also highlights ‘significant difficulties’ around the process of requesting a ‘defined certificate of sponsorship’. This is a mandatory step when issuing sponsorship under the Skilled Worker route. ‘Simply put,’ he explains, ‘it is the business asking for pre-approval from the Home Office to sponsor someone in a given role.’

Defined certificate of sponsorship requests are normally processed within two working days. However, if the Home Office asks for additional information before approving the request, it can take weeks to respond. As a result, Harber says: ‘We have seen many instances where it has taken the Home Office more than 12 weeks to respond to the request. During this time the candidates became jaded with the process and took up offers of employment in other countries.’

‘Processing backlogs pose significant operational challenges across the entire immigration and asylum system,’ Luchowa says. She points to a UK Visas and Immigration (UKVI) announcement this month that in-country Skilled Worker applications will take four months to process on average, compared to the usual service standard of eight weeks.

And the impact is also felt by families. Says Luchowa: ‘Out-of-country family visa applications for spouses, partners, and children of British and settled family members currently have a startling six-month waiting period for processing.’ Previously, these applications were processed in around three months, with the option of a 30-day priority service.

While the government aims to bring the service standard back to eight weeks, Ruhul Ayazi, of counsel at Ogletree Deakins, says: ‘This provides little comfort to individuals who cannot leave the Common Travel Area… before a decision is made on their application.’ The CTA includes the UK, Republic of Ireland, Channel Islands and Isle of Man.

‘If they do leave the CTA, their application will be treated as withdrawn,’ Ayazi explains. ‘Therefore, the ongoing delays are also causing personal difficulty for visa applicants whose lives are effectively put on hold pending the receipt of a decision. This cannot continue and immediate action is required by the Home Office to address the current issues.’

SMEs

Small and medium-sized enterprises are often described as the backbone of the economy. But they have been disproportionately hit by both changes in immigration policy and degraded service levels.

Many are among the 64,000 businesses registered as ‘sponsors’, but achieving that status does not remove cost, inconvenience and uncertainty from the process. Garcia explains: ‘Despite the popularity of the sponsorship system, the miles of red tape post-Brexit make it virtually impossible for SMEs to navigate the maze of immigration rules and guidance.’

'Post-Brexit immigration policy completely neglects the glaring skills gaps facing the retail, hospitality and catering sectors'

Kerry Garcia, Stevens & Bolton

Without in-house HR or legal capabilities, Garcia adds, meeting the reporting and record-keeping duties required by the sponsorship system is often unfeasible. ‘On top of this,’ she says, ‘the Home Office may visit businesses to check compliance without prior warning, providing a constant threat of revocation or suspension of the sponsor licence should an organisation be found not to be compliant.’

As a result, Garcia says, ‘the extreme costs of sponsorship, when taking into account Home Office fees, priority processing fees, the skills surcharge, and the obligatory contribution by the individual sponsored worker to the NHS, completely disincentivise businesses from sponsoring individuals who aren’t very senior or specialist’.

Completing a picture of poor outcomes from the immigration system for SMEs is a UK policy focus that neglects important, yet ‘low-skill’ roles. ‘Post-Brexit immigration policy completely neglects the glaring skills gaps facing the retail, hospitality and catering sectors – given the current system’s focus on medium or highly skilled labour,’ Garcia says. Earlier this week business lobby group the CBI urged chancellor Jeremy Hunt to use yesterday’s autumn statement, delivered as the Gazette went to press, to ease immigration rules to support companies struggling with chronic staff shortages.

What next?

Immigration lawyers also note that the Home Office has begun implementing a number of digital solutions. The hope, Harber says, is that once up and running ‘the process of applying for visas and managing a sponsor licence should become easier and faster’. There have, he notes, been teething problems, with delays caused by IT issues. ‘The Home Office has acknowledged that the implementation process has not gone as smoothly as planned,’ he adds.

‘From my conversations with operational directors within UK Visas and Immigration, it is clear that there is a high level of acknowledgement of the issues and the need to resolve the situation quickly. We can be hopeful that as we move into 2023 the operational capabilities of the Home Office will improve significantly.’

‘Our team expects considerable changes, as the digitisation of the immigration system progresses,’ Luchowa says. ‘Depending on their nationality and visa category, some of our clients have begun receiving digital-only immigration status.’

All biometric residence permits are due to expire on 31 December 2024. The expectation  is that the Home Office will implement a fully digital border system by 2025. The recent Nationality and Borders Act 2022 includes provisions to introduce electronic travel authorisation (ETA) for non-visa nationals, a system similar to that in the US.

Luchowa warns: ‘While the Home Office has promised a quicker, more secure and cost-effective system, critics argue that the shift towards digitisation may lead to discriminatory treatment of some vulnerable migrants, such as the elderly or homeless. These developments will prove a tough challenge, but one for which the government is investing significant personnel and financial resources.’

Digitisation can be a particular challenge when clients have non-standard or unusual features to their application or circumstances. As Harber notes: ‘As for complicated cases and appeals which don’t fall within the standard templates that the Home Office work to, we are seeing even greater challenges.’

Due to the Home Office’s communication structure, he says it is ‘very difficult, if not impossible, to communicate with them when something goes wrong with an application or there is a situation that is outside of the normal procedure’. Harber has ‘a couple of applications pending at the moment where there were technical issues with the transfer of information from the application centre to the caseworking teams. Despite several weeks of chasing we are no closer to resolving the issue’.

But the big uncertainty in immigration is, as always, around policy and political interference. Over time the application of immigration policy, experience shows, is never truly arms-length or independent.

As Garcia concludes: ‘Given the recent changes to government, it’s anyone’s guess whether there will be any new immigration routes in the foreseeable future.

‘It’s been reported that Suella Braverman, current home secretary, is very reluctant to introduce new immigration routes and, in fact, wishes to cut net migration. This is however against the backdrop of continuing labour shortages, a need for economic growth and a call from numerous businesses to make it easier to hire overseas labour, meaning that the government may be forced to reconsider.’