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Visa fees predicted to hit smaller firms

The government has announced the immigration fees to be charged under the new points based migration system, but the CBI has said the charges will adversely affect smaller employers.

The new system is designed, the government says, to make sure that only workers with the skills to benefit the economy come to the UK. It will put in place a licensing system for businesses that want to recruit from overseas.

Liam Byrne, the immigration minister, said: “We believe that it is fair that those who benefit most from using our immigration system should help fund it. We welcome the contribution that legal migrants make to the economy and cultural life in the UK and we have ensured that these fees, which will usher in the biggest reforms to the immigration system in a generation, are at levels that will not damage our international competitiveness.”

However, the CBI responded by arguing that the new flat registration fees will penalise smaller employers.

John Cridland, the CBI’s deputy director general, said: “Businesses are going to face a considerable increase in visa fees this year, and some smaller firms could see them go up by as much as 580 per cent. Whether an employer needs just one skilled migrant or fifty, they must pay a new flat registration fee. This only becomes cost effective the more people you hire, so smaller firms will take more of a hit.”

Mr Cridland added: “Business accepted last year’s rise of 135 per cent in skilled work permit fees on the basis it would fund improvements to the immigration system. There’s been little progress in developing better employer support, but the government has still imposed further cost increases at a time when it is also expecting employers to perform more rigorous checks on their employees as part of the system. By seeking to recover far more than the cost of processing the application, the government risks putting up a barrier to firms hiring people with the skills they need to grow and create jobs for the good of the whole economy.”

Date:31 January 2008

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