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German lessons for Britain on European workers

By Denis MacShane

This is an article originally published in German in Handelsblatt – “Muss London Deutsch lernen”?

One of the knottiest problems for British politicians struggling with Brexit is their insistence as much by Labour as the Conservatives that Britain has to set up a giant new immigration bureaucracy to issue work and residence permits for any European citizen who is offered a job in Britain.

Undoubtedly the main factor in swinging the Brexit vote was it gave the chance to white English men and women their chance to vote against immigrants. 50 years ago, a racist but very senior Tory politician, Enoch Powell, said Britain was “mad, literally mad, as a nation” to allow immigrants into the country.

Powellism sunk deep roots very fast even if it was repudiated by the party leaders of the day. He was also hostile to Britain joining the European Community. That fusion of two English phobias – against immigration and against Europe – never went away. After 2000 as the Conservatives sought to undermine the pro-European Tony Blair they unleashed with the help of other anti-immigrant, anti-EU parties like UKIP and the British National Party forces that culminated in Brexit when a majority of white middle-class as much as working-class people living in England voted to finally to stop immigration.

It is modish to blame Mrs Merkel’s decision in 2015 to let in one million refugees fleeing murderous conflicts, oppression and poverty in the Middle East and North Africa for Brexit and the rise of Europe new nationalist, anti-immigrant right represented by Viktor Orban in Hungary or Jarosław Kaczysnki in Poland.

Orban was first prime minister in 1998 and Kaczynski in 2006 long before recent waves of immigrant. The anti-immigrant Jean Marie Le Pen defeated the French socialist Lionel Jospin in 2002 to go into the second round of the French presidential election.

Xenophobic politics, including in part the Brexit result, is caused by xenophobic politicians. The Federation of Poles of Great Britain in 2008 published a dossier of 50 hate front pages by the Daily Mail. The pro-Brexit paper depicted Poles in much the same way as the ame paper described Jews in the 1930 – unwanted crooks and scroungers who had no place in Britain.

Xenophobic anti-immigrant votes piled up well before 2015. In a book published in January 2015 I predicted Britain would vote for Brexit as anyone who spent five minutes outside the liberal, bien-pensant, Europhile salons of London or Oxford knew the success of populist politicians in creating hostility against immigrants.

Some blame the UK government decision of 2004 not to impose tough restrictions on workers from the 8 new EU member states of Eastern Europe. Joachen Bittner, political editor of Die Zeit, the German weekly recently argued in the New York Times that Mrs Merkel was to blame for Brexit following her decision to let in refugees to Germany in 2015. https://www.nytimes.com/2018/09/26/opinion/is-merkel-to-blame-for-brexit.html

The images of refugee queues did not help for sure but the passions that led to Brexit were in place long before 2015. But there were already hundreds of thousands of Poles and other citizens from ex-communist countries working in Britain. It seemed more sensible to let them work legally rather than was as the case in Germany having them work in the unofficial cash-in-hand labour market. In fact, Germany’s 2004 Zuwanderungsgesetz (Immigration Law) allowed exemptions for employers to hire in EU workers.

For Britain accepting EU citizens worked in the sense that the European immigrant worker made a massive net contribution to Britain fiscal receipts with £25 billion annually coming into government finances. A study just published shows that the European immigrant worker pays £440 more in taxes than his English equivalent.

Today Germany has 1.7 million Poles living and working and a total 6.1 million EU citizens. These are twice the figures of Poles and other EU citizens living and working in Britain so the argument that Germany slowed down arrivals from Europe in comparison to more liberal Britan after 2004 doesn’t hold up.

Where Britain did go wrong was not to copy Germany and other EU member states in managing these new arrivals. When David Cameron pleaded with Angela Merkel to stop the arrival of Europeans in Britain because they were putting pressure on housing, schools and health services she asked him to send a list of how many EU citizens there were and where these problems could be examined.

Berlin is still waiting because Cameron nor his successor knows how many EU citizens are in Britain. Mrs May in 2010 abolished am embryonic  Identity Card system and then the EU worker registration system that allows all other EU member states to count the numbers accurately.

The EU’s so called freedom of movement rules do not apply to state employment. Yet the biggest employer of EU citizens in Britain is the state run National Health Service. Britain could train its own doctors and nurses but prefers to import them from abroad.

Britain has the worst apprenticeship schemes in Europe so employers who need skilled craft workers like electricians, IT specialists, plumbers, heating engineers, even bricklayers and carpenters had to recruit from Europe as there were no such skilled workers coming into the labour market from within Britain.

Employment agencies acted as gang masters brought in East European workers and renting them out to local British employers at extremely low wage rates. This was illegal under EU law but British government officials turned a blind eye to these practices in order to maintain a flow of docile, low-pay workers for British firms.

Other European countries like Germany had much tougher internal labour market rules, gave trade unions a voice with employers on hiring workers from outside Germany, had proper apprenticeship training systems, educated more nationals to be health service workers, and insisted every European worker was registered with an identity card.

Mrs Merkel might have suggested to Tony Blair, Gordon Brown, David Cameron and now Theresa May that if Britain copied much stricter management of internal labour markets and promoted training and jobs for local workers the kind of anti-immigrant tensions that culminated in Brexit might have been avoided.

But it was not up to Mrs Merkel to teach and British prime minister refused to learn from best practice on the continent in terms of labour market rules and support for local workers.

It is not too late. London could take the best measures from other EU member states and show that labour mobility adds value and there is nothing to be feared from immigration. After all in Europe’s richest nation, Switzerland 26 per cent of the population is foreign born.

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Denis MacShane is the UK’s former Europe minister. Before becoming an MP in 1994 he worked in Switzerland, France and German on labour market issues. In January 2015 he published Brexit: How Britain Will Leave Europe highlighted anti-immigrant populism as leading to the Brexit referendum result.