Cable defends temporary cap on non-EU migration

Business Secretary Vince Cable defends the "overall impact" of the Budget

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Vince Cable has defended government plans for a temporary cap on migrant workers from outside the EU.

There will be limit of 24,100 until April 2011 while the coalition consults on a permanent cap and some businesses have raised concerns about recruitment.

But the business secretary said it must be implemented in a "flexible way".

Mr Cable said ministers had "signed up" to the principle of a cap, but they must "accommodate" the needs of certain industries as well as universities.

Labour has said an arbitrary immigration cap is "fraught with difficulty".

The Lib Dems opposed Conservative proposals for an annual cap before the election - but agreed to back the proposal as part of their coalition agreement.

'Reassuring the public'

The temporary cap, due to be announced on Monday by Home Secretary Theresa May, is aimed at preventing a rush of applications before a permanent figure is agreed.

ANALYSIS

The problem for the government over capping the number of non EU workers coming to Britain is that the politics and the economics of immigration are at odds.

Politically, the Tory promise to reduce net immigration to tens of thousands, was one of its big vote winners at the election. Its also a non negotiable for many party activists.

The business community - and the Business Secretary Vince Cable - however are less than thrilled at curbs on their ability to recruit skilled staff from outside of the EU.

There's also anxiety at the imposition of yet another tier of Government regulation and claims the move runs counter to the Coalition's desire to promote Britain as "Open for Business."

Universities too are alarmed at a cap which would restrict their ability to attract post graduates and academic staff.

Ministers are now talking about a "flexible" approach to implementing the cap. Its also being stressed that the cap is only one part of their plan for reducing net immigration.

Sources insist the policy is not about to be watered down but it seems compromise is very definitely in the air.

Mr Cable told the BBC's Andrew Marr show that it was designed to "pre-empt a flood" of new arrivals in the period before permanent arrangements came into force.

Businesses have warned that the cap could stop them from filling vacancies at times of high demand and also recruiting people with specific skills in areas such as catering and social care.

Critics have said the measures could have have a detrimental effect on the higher education sector, which is reliant for much of its income on foreign students.

"The new regime has to accommodate those concerns," Mr Cable said. "It has to be implemented in a flexible way."

The government had to "reassure the public" that there was an effective system of immigration controls in place but also to ensure the economy was not damaged as it seeks to recover from the effects of the recession.

'Confident'

He said talks between Conservative and Lib Dem ministers on the issue had been "collegiate".

"I am confident the way it is being implemented will achieve these objectives," he said.

During the election campaign David Cameron said he wanted to reduce net annual migration - the number of immigrants minus the number emigrating from the UK - from hundreds of thousands currently to tens of thousands.

Labour says any policy needs to be "tough but fair" and that the points-based system it introduced in 2008 has succeeded in reducing immigration levels and stopping unskilled workers from outside the EU coming into the UK.

The home secretary will give details on Monday of the consultation process ministers will undertake before deciding what the permanent cap should be.

It has been reported that this could include the option of exempting job categories to reflect skills shortages in some areas.

Budget defence

Mr Cable also defended the Budget, saying many of the spending cuts and tax rises announced by Chancellor George Osborne were "unpleasant" but action was needed to deal with the "horrendous" financial situation the coalition had inherited.

Measures such as raising the income tax threshold for the lowest-paid - as well maintaining the top rate 50p tax band and cutting pension tax relief for the better-off - helped offset the VAT increase in terms of where the burden fell, he added.

"If you look at the package as a whole, that makes the balance much better and more equitable," he said.

He also played down talk that Lib Dem MPs could seek to table amendments to the Budget following comments by the party's Deputy Leader Simon Hughes last week.

"We have a balanced package as it is," he added. "We are not reopening it."

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