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IT companies get boost as transfers exempt from migrant cap

IT companies get boost as transfers exempt from migrant cap

HP, Microsoft and Indian offshorers benefit from change to intra-company transfer legislation

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Workers on intra-company transfers will not be counted in the government’s migration cap, according to Prime Minister David Cameron.

This is good news for international IT companies, like the US-headquartered HP, IBM and Microsoft, as well as Indian outsourcers, such as Wipro and Tata Consultancy Services (TCS), who rely on a flexible and multinational workforce.

Speaking at Prime Minister’s Questions last week, Cameron said: “Intra-company transfers shouldn’t be included in what we are looking at.”

This was somewhat of a U-turn for Cameron, whose Conservative Party’s election manifesto had championed an immigration cap to reduce net immigration to “tens of thousands”. Net immigration currently stands at 196,000 a year.

However, Home Secretary Theresa May admitted at London’s Policy Exchange last week that it would not be easy to achieve the target reduction of tens of thousands.

“It will take hard work and a great deal of political courage. But the British people want us to do it and it is the right thing to do. So we will do it,” said May.

May said that the government wanted to ensure that only the ‘brightest and the best’ come to the UK, and one of her priorities was to encourage more entrepreneurs and investors to come into the country.

“The government intends to control immigration by focusing on all aspects of the immigration system, not just the points-based system. So over the coming months action will be taken on students, families and settlement as well as people coming here to work,” she said.

A permanent cap on the number of immigrants coming from outside the European Economic Area will come into effect in April 2011.

Large, multinational businesses had protested strongly against the plans and the possible impact on their ability to be competitive. However, the Financial Times said that the UK Border Agency was unhappy that companies in certain industries, particularly Indian IT suppliers, used the transfer scheme to take on cheap workers to do jobs that could be done by UK graduates.

Andrew Green, from the anti-immigration pressure group Migration Watch, told the BBC: “In 2009, over half of all intra-company transfer visas issued went to Indian IT workers – 10,000 to just three companies.

“They are clearly undercutting tens of thousands of unemployed UK IT workers while computer science graduates suffer the highest unemployment of any discipline, currently 16 percent.”

Richard Holway, chairman at analyst house TechMarketView, agreed with Green:

“I have no problem with the Indian players (as that is the source of most of this migration) bringing highly-skilled IT professionals or key management here to the UK. But I really do object to them bringing the kind of three to six years’ experience people who could just as easily have been trained here,” Holway wrote on the TechMarketView website.

According to the BBC, last year, skilled workers entering the UK on intra-company transfers represented 22,000 out of a total 36,490 skilled migrants. The maximum length of time that an intra-company transferee can stay in the UK is five years.

Meanwhile, the prime minister has announced the creation of a new ‘Entrepreneur Visa’ when he outlined his goals for the creation of London’s version of Silicon Valley in East London on 4 November.

“These entrepreneur visas will mean that if you have a great business idea, and you receive serious investment from a leading investor, you are welcome to set up your business in our country.

“If you’ve got an idea, if you want to create jobs, and if you have the ambition to build a world-beating company here in the UK, we want you,” Cameron declared.  

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