BREXIT: UK government lacks consensus over immigration, says expert

Last week UK chancellor Philip Hammond told the House of Lords economic committee that skilled workers, including financial services workers, are likely to be exempt from curbs on immigration that are likely to apply when the UK leaves the EU.

"We cannot accept uncontrolled free movement of people – that’s the political outcome of the referendum decision that was made," Hammond said.

“But … I would expect, using the control that we would have over movement of people, we would use it in a sensible way that would certainly facilitate the movement of highly skilled people between financial institutions and businesses in order to support investment in the UK economy – that would certainly be my expectation”, Hammond told the committee.

Employment law expert Euan Smith of Pinsent Masons, the law firm behind Out-Law.com said, though, that Hammond's comments were the latest from senior government officials on post-Brexit immigration policy. He said it is becoming clear from those comments that there is "confusion in government and a lack of agreement as to what any post-Brexit immigration landscape may look like for EU workers coming to the UK".

"Last week the prime minister commented that she did not think that the points-based system, which is in place currently for non-EEA workers, should be adopted for EEA workers following Brexit," Smith said. "Then Philip Hammond made the speech in the House of Lords in which he suggested that the new immigration system would have to facilitate the movement of skilled workers in the financial services sector."

"At the weekend, however, the home secretary challenged that, saying there was no specific plan in place at this stage and it was too early to tell whether particular groups of workers would be favoured over others. So it doesn’t appear that any decision has been made, and these people are simply stating what they think should happen," said Smith.

"There is no reason why a points-based-system could not be set up in a way which favoured particular groups of employees. In fact, it already does that: the existing points-based-system permits easier immigration if the role you are coming to the UK to perform is on the shortage occupation list, which is periodically reviewed and updated by the government. So certain groups of employees, notably doctors and nurses, are already given advantages because of their occupation," Smith said.

Hammond told the Lords' committee that EU policymakers should not try to use Brexit to undermine the position of London as the continent’s principal financial centre.

"London's banks support the economy, across the whole of the UK," Hammond said. "There is a very complex ecosystem that could not be replicated elsewhere, so to attempt to damage it would be a huge mistake for any EU partner."

The UK's financial services industry has made it clear that its preferred option as part of the Brexit process would be for the UK to seek access to the single market, and to continue to benefit from passporting rights.

However, numerous reports have suggested that this type of single market access would almost certainly require the UK to agree to freedom of movement of EU workers.