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By Philippe Legrain 1 COMMENT

This article first appeared on the Guardian‘s Comment is Free.

To anyone concerned that immigration is out of control, a promise to capthe number of people entering Britain seems very appealing. That’s why the Conservatives made the pledge during the election campaign. Such is the anti-immigrant fervour among the Tory grassroots that David Cameron didn’t dare ditch the proposal when drafting the coalition deal with the Liberal Democrats.

But now that the government is actually beginning to implement the policy, the holes in it are becoming all too clear. It will damage the economy without addressing any of the political concerns about immigration.

Theresa May, the new home secretary, has imposed an initial cap of 24,100 on the number of non-EU migrants who can come work in Britain between now and April 2011. She has also announced a consultation with businesses and other interested parties before introducing a more permanent limit. The overarching aim is to reduce net immigration to Britain from “hundreds of thousands” – the actual figure was 176,000 in the 12 months to June 2009, according to the Office for National Statistics – to “tens of thousands”.

The new cap is absurd. Since less-skilled workers had already been denied legal entry by Labour’s points-based scheme, it will only keep out highly skilled workers from outside the EU – people with exceptional talents and those with skills that are in short supply in Britain. Tightening the screws on migrants who are already small in number but make an outsized contribution to the economy will damage the fragile recovery while scarcely denting overall migrant numbers.

Once the arbitrary annual limit is reached, foreign workers will be turned away irrespective of their merit and how much they are needed. Big businesses will not be able to recruit the talent that they need to compete in global markets. A small business that has just won a big export order but cannot find the highly trained engineers it needs in Britain will not be able to hire them overseas. A local school that needs a new science teacher will have to do without. The football club you support won’t be able to bring in a top-class African or Brazilian striker. So much for the government’s claim that Britain is “open for business” – it is actually putting the shutters up.

Only the most extreme opponents of immigration object to highly paid foreign workers with valuable expertise who pay lots of tax and make little use of public services, while many of the government’s supporters in business depend on such migrants. So where is the political gain in clamping down? Most of the new arrivals that people expressed concern about during the election campaign have come from eastern Europe. Short of leaving the European Union, their numbers cannot be curbed by government policy – although because of the recession, far fewer are coming while many more are choosing to go home.

In opposition, the Conservatives had an incentive to fan the flames of public discontent about immigration. But now that they are in government, they would do better to adopt more constructive policies. Since freedom of movement within the EU is here to stay, they should point out its benefits – not just to the British economy but also to the millions of Britons who live, work and retire on the continent.

Since so many of the tensions about immigration revolve around housing, they should ease planning restrictions and swallow their hang-ups about building more social housing. And since public services are another flashpoint, they should make sure that local services respond more quickly to changing needs – and have the cash they need to do so. These are all points the Labour leadership candidates could be making too.

The coalition government should get serious about its immigration policy. By capping foreign talent, it is tilting at windmills.

Posted 29 Jun 2010 in Blog

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