UK Government plans to curb immigration after Brexit could shrink Scotland's workforce and jeopardise tax revenue needed to fund vital public services, experts have warned.
The Scottish Government commissioned research said Scotland’s working age population could fall by up to 5 per cent over the next two decades, while it grew in the rest of the UK.
The Independent Expert Advisory Group on Migration and Population said new rules for EU nationals after Brexit could reduce halve migration to Scotland.
This would have a direct impact on the economy, public services and population growth, with remote areas and Scotland’s £6bn tourism industry particularly hard hit.
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There could also be significant staff shortages in the social care sector, adding to the strain on services for the elderly caused by a shrinking taxbase.
Business leaders said the study showed the worrying impact of the plans and urged the UK government to change course.
The report coincided with official statistics showing EU net migration at its lowest level since 2009, and more citizens from Central and Eastern European leaving the UK than arriving.
Under the UK’s immigration plans, EU workers currently able to enter the UK through freedom of movement, would be stopped unless they earned more than £30,000.
The advisory group estimated 63% of workers in Scotland currently earn below the threshold, and imposing it would disproportionately affect women and the young.
UK plans for seasonal and temporary programmes would prohibit the longer-term settlement of immigrants working in key sectors, especially in rural areas, the experts said.
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SNP migration minister Ben Macpherson said: “The Scottish Government has been consistently clear that freedom of movement has enriched Scotland and should be allowed to continue.
"The UK Government’s focus on reducing immigration will damage Scotland and does not reflect the needs of our economy, our public services or our communities.”
Professor Christina Boswell of the University of Edinburgh, the chair of the advisory group, said: “If the UK Government’s proposals are enacted, we are likely to see a substantial fall in net migration to Scotland over the coming decades. But importantly, the effects of this reduction will vary across different sectors and local areas.
"The report considers the particular challenges for sectors reliant on non-UK workers who earn less than the proposed £30,000 threshold - such as accommodation and food services, manufacturing, and social care.
“It also considers the particular challenges for rural and remote communities, which are especially reliant on in-migration to sustain economic livelihoods and public services – but which will be most affected by the proposed salary threshold.
"The proposed transitional arrangements for short-term migration are also likely to lead to higher churn and integration challenges in local communities.”
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Andrew McRae, of the Federation of Small Businesses in Scotland, said: “This thorough report... chimes with feedback from our membership and reinforces the case for an alternative approach to be developed.
“Fewer working age people in Scotland will make it more difficult to run a business, especially in rural areas and in a number of key sectors.
"We need to see UK policymakers reflect on this study’s findings, as well as the message they’re getting from business, and take a more measured approach.”
Reacting to the latest official migration figures, Matthew Fell, CBI Chief UK Policy Director, said they would exacerbate labour and skills shortages across multiple sectors.
“Businesses cannot succeed without access skills and labour, which is why it’s so important the Government delivers a post-Brexit immigration system which is both open and controlled," he said.
“Establishing routes for firms to hire staff from the EU earning less than £30,000 and lengthening temporary visas are just two proposals that improve upon existing proposals.
"Employers of all sizes right across the UK will hope the Government acts on evidence from business carefully before taking decisions that will influence the UK’s competitiveness for decades to come.”
Scottish Labour MP Ian Murray, a supporter of the pro-Remain Best for Britain group, said: "This is further evidence that Brexit has made EU nationals living in the UK feel unwanted.
"That's the opposite of what our country needs right now. Our hospitals need nurses and doctors, our schools need teachers, our universities need the best academics and researchers, and our divisions need healing.
“As Parliamentary paralysis continues, more and more people are packing their bags and leaving.
"The power to decide our future must be given back to the British people, giving them the final say on the Brexit deal, with the option to stay and build on our current deal with the EU firmly on the table."
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