The current Tier 1 (Investor) route did not do enough to benefit British residents, a new report by the Migration Advisory Committee (MAC) has revealed.
Evidence submitted by current users of the route showed most applicants are most likely to invest the minimum amount for the route and would like to scrap the requirement that their investment has to be kept at the same level throughout their time in the UK.
At the same, evidence gathered by the government’s independent advisory body on migration issues shows prospective migrants would be willing to pay more for these changes.
After gathering evidence from financial organisations and users, the Committee has recommended increasing the minimum threshold for investment for the standard route from £1m to £2m and relaxing restrictions on investment opportunities to bring more tangible benefits to the UK economy.
The Committee also recommended replacing the higher investment routes of £5m and £10m, which are hugely under-used, with a “premium route” to give applicants an incentive to make a more significant contribution to the UK.
Anyone applying under the premium route would benefit from relaxed residency requirements, effectively halving to 90 days the amount of time an individual has to remain resident in the UK a year.
According to the Committee, access to this premium route should be limited and the price of entry best determined through an auction, allowing the market to set the price.
Any excess above the reserve price could be put into a good causes fund, similar to the one operated by the National Lottery.
As is the case now under the existing rules, the changes recommended by the MAC would lead to settlement only and not citizenship.
Although the Committee found that investor migrants have an indirect beneficial impact through their general expenditure in the UK, particularly on things such as private education, it believes the reforms recommended around the direct investment itself will make it much more likely that UK residents gain from this route.
Chairman of the Committee, Professor Sir David Metcalf CBE, said: “We have focussed our attention on how UK residents may gain from this migration route. We express some healthy scepticism regarding the value to UK residents of high net worth individuals coming to the UK.
“The Committee has recommended some straightforward reforms that we believe make it much more likely that UK residents will benefit while continuing to show that Britain is open for business.”