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Press Notice No 11/02:

PCG warns ‘Wrong time to relax work permit regulations’

The Professional Contractors Group has warned the Home Office that it is the wrong time to relax the laws on work permits for overseas IT workers and has advised it to reject proposals to allow agencies to bring in contractors from abroad on ‘fast track visa’ work permits.

Work Permits UK, the Government agency responsible for the issue of work permits, has undertaken a consultation to review the policy of the work permit issue as regards recruitment and employment agencies and contractors. At present agencies are only able to recruit workers for advertised positions and cannot directly import foreign contractors, but agents and their representative bodies have been lobbying the Government to relax this rule. The PCG has submitted a detailed paper to Work Permits as part of this consultation process, outlining why it would be wrong to relax these fast track entry requirements at this time.

Philip Ross, PCG Policy Advisor, said: “There are many things we want changed within the current work permits scheme, but this isn’t one of them. We want the scheme to be tightened up to stop firms displacing UK contractors and dismantling projects and taking them offshore.

“In the past few months, the PCG has had some success in demonstrating to the Government that the scheme has needed tightening up and the Government has taken action in some areas on this. But to now consider relaxing one part of the scheme while tightening up on another is contradictory. We have clearly demonstrated that the scheme is already being abused and misused – this proposal to extend it further will result in more abuses of the system. There is little point plugging one hole if you are going to open up a bigger one.

“The UK’s IT industry is currently in recession and there are more skilled workers out of work in this industry than at any time in the past. There is clear and growing evidence that there is not a skills shortage in this sector. Surveys by the PCG, and others, have demonstrated that at least 30 per cent and possibly as many as 50 per cent of contractors are between contracts, while other surveys continue to show the IT contract market is in recession. This combined with the recent news that many firms are forcing their contractors to take huge rate cuts suggests there is no need to import more IT workers from abroad.

“Our principal criticism of the current scheme is that it doesn’t recognise fully the role of IT contractors in the market. Under the current arrangements: ‘tier 1’, ‘tier 2’ and ‘intra-company transfer permit’ issues, generally known as ‘fast track visas’ are often being used to displace resident IT contractors.

“Evidence received by PCG from members and others has demonstrated that foreign permit workers are currently replacing UK workers. This evidence has been handed over to Work Permits UK and to the Home Office Minister. Changing the scheme to allow agencies to issue work permits themselves will result in further abuses of the system and would relax the criteria at the time we’re showing clear evidence that it needs tightening up.”

The PCG’s submission has been handed to Work Permits and will be passed to Ministers in July, with submissions by other groups concerned by the proposals. The results on whether there will be a change in policy, or not, will be announced in September.

Notes to editors

  1. The Professional Contractors Group was formed in May 1999 to lobby against the Government’s IR35 proposals. It is a non-party political group and its patrons are cross-bench peer, Lord Weatherill, former Speaker of the House of Commons; and industry guru Sir John Harvey-Jones. Since its formation it has evolved into the representative body for independent contractors from many disciplines including IT and engineering on a range of issues affecting the knowledge-based sector.
  2. The PCG’s aim is to work for proper recognition of independent contractors as a genuine and valuable sector of the economy, generating wealth and employment, providing industry with a flexible workforce. The Internet has been the primary resource, providing fast, effective communication.
  3. PCG has been actively involved in the fast track visa campaign and represents the contractor community on the Government’s Skill Sector Panel for IT. The fast track visa scheme permits companies to bring in overseas workers who possess skills which are deemed to be in short supply.
  4. The Work Permits Consultation document was entitled: ‘Review of Work Permit Policy on Recruitment and Employment Agencies and Contractors.’

    The PCG’s response to Work Permits Consultation is available in full here:
    www.pcgroup.org.uk/resources/pcg-review7.pdf
  5. For further information about the PCG see: www.pcgroup.org.uk
  6. For further press notices about the PCG’s position on fast track visas see: www.pcgroup.org.uk/press_rel.html

For further information:

Philip Ross
07881 685 952
philip@susiehughes.co.uk

Susie Hughes
020 7462 7955
susie@susiehughes.co.uk