 The next item of business is a statement by Fiona Hyslop on implications of the White Paper on immigration and the population of Scotland. The cabinet secretary will take questions at the end of her statement so that there should be no interventions or interruptions. I call on Fiona Hyslop to make the statement. In the last week before Christmas, the UK Government published long-delayed plans for the immigration system after the UK leaves the EU. I want to provide Parliament with an assessment of the impact that we think that these retrograde proposals will have on Scotland, building on the reaction that the First Minister outlined in Downing Street. Making the positive case in support of immigration is sometimes a difficult thing for politicians to do. It is undoubtedly true that concerns about immigration were an important driver of the vote to leave the EU in some parts of the UK, and immigration remains a contentious issue for many. People with concerns deserve to be listened to and treated seriously. It is also true that those concerns are often based on misconceptions that are not supported by evidence. Political leaders have a responsibility to listen but also to respond in a way that builds understanding and raises awareness. It is greatly to the credit of this Parliament that members here have risen to that challenge. We all agreed that migration to Scotland supports economic growth, helps to address the serious issue of long-term demographic change and enhances and sustains our communities. The Migration Advisory Committee undertook a review last year of the impact of migration on the UK labour market. It found no evidence that migration reduces employment or training opportunities or the wages of UK workers. Furthermore, there is clear evidence that migrants contribute more through taxes than they receive in benefits or public services. The Migration Advisory Committee finds increases productivity, innovation and GDP per capita, helping to raise living standards for all of us. It is therefore extremely disappointing that the policy measures that the UK Government has put forward fail to lead the debate or respond to the evidence. The proposals in the UK white paper would prove economically damaging to the whole of the UK, but especially for Scotland. I will briefly remind members of the key measures in the white paper before describing why Scotland would fare worse than other parts of the UK. The UK Government plans to end freedom of movement of people from the EA after the implementation period and manage all economic migration to the UK through a single system. That will, in effect, be the current tier 2 employer-sponsored route for most workers with some adjustments. Tier 2 is widely held by business to be both complex and costly and is currently limited to only high-paid, graduate-level roles in the main. The UK proposes to lower the skill requirement once European migration comes into tier 2, so that skilled roles below graduate level are eligible. However, it also intends to maintain a salary threshold expected to be set at £30,000. That would price out many roles even with a skill barrier reduced. Does nothing to address the fact that the administrative and financial costs of tier 2 mean that many small and medium enterprises cannot make use of it? The Federation of Small Businesses estimates that 95 per cent of small businesses in the UK have never used tier 2 due to those barriers. Cutting off access to international talent by ending free movement would be a disaster for those firms. There is also no route for what the UK Government termed lower-skilled roles, roles and important skills, that make a vital contribution to our economy and society, such as social care, tourism, hospitality, construction and others. The 12-month visa for those workers announced as a transitional measure is inadequate for business and without a route to settlement would stop people with the important, valued and valuable skills that we need from being able to live, work and, importantly, raise their family here and to help tackle demographic challenges. Remember that currently all our projected population growth is due to come from migration over the next 25 years. Those proposals will have a negative impact on the economy of the whole of the UK and the figures in the immigration white paper show that clearly. It is important that members are clear and understand that the impact of those changes would be greater in Scotland than the UK as a whole. UK Government figures published in the white paper showed that 80 per cent of projected long-term EA worker inflows to the UK would be affected by those changes, rising to 85 per cent for Scotland. That accords with the Scottish Government's economic modelling, published in our discussion paper, Scotland's population needs and migration policy that was published earlier last year. Using official population projections from the ONS and the NRS, that showed that the slow down in migration as a result of the Brexit vote would result in reduced GDP growth in the UK of 3.7 per cent by 2014 and 4.5 per cent in Scotland. An alternative scenario using the 50 per cent less EU migration projection estimated a 6.2 per cent reduction in GDP growth for Scotland relative to growth in the economy under pre-Brexit population projections. That scenario also estimates that the UK economy would be 5.9 per cent smaller as a result of lower population growth. Separate modelling has also highlighted the importance of migration and productivity. Under a hard Brexit trade and tariff barriers are estimated to have the most immediate economic impact, but in the medium to long term the impact of reduced migration and the decline in productivity will overtake that, accounting for up to 85 per cent of lost economic growth compared to remaining in the EU. Migration is particularly important in supporting growth in our working-age population. In the 50 per cent reduction scenario, Scotland's working-age population will decrease over the 25 years to 2041, but it is not 50 per cent that the UK says migration to Scotland will fall by. It is 85 per cent of future workers who would not be eligible under those plans. It has never been clearer that keeping free movement of people would be both in Scotland and the UK's best interests. Free movement is also a set of reciprocal rights that British people as EU citizens themselves can also enjoy to live, work and study across the continent. We want our fellow EU citizens already in Scotland to stay. They are part of the fabric of our country. In December, we announced that the Scottish Government will deliver an advice service for EU citizens in Scotland in partnership with Citizens Advice Scotland and its network of Citizens Advice Bureau. There is an urgent need for clear and trusted information on citizens' rights and the existing network of Citizens Advice Scotland, together with its trusted status, will allow the service to be delivered quickly across Scotland. Of course, the Scottish Parliament voted on 19 December, calling on the UK to scrap the settled status fee, but if it does go ahead, the Scottish Government has made the commitment to pay the fees for EU citizens working in our devolved public services. That includes doctors, nurses and other public sector workers on whom we all rely. We will provide further details of the process for this shortly. As the disastrous approach of the UK Government unfolds, there is growing support for a new tailor-made solution for Scotland. In response to the white paper, the STUC said that the First Minister is right to highlight both the negative effect of pandering to an anti-migrant sentiment and the need for a separate Scottish approach. The STUC supports additional powers on migration for the Scottish Parliament. Business groups and employers have made similar statements. FSB Scotland said that we have argued that there should be a system in Scotland that responds to the particular needs of the Scottish industry and demography. The Scottish Council for Development and Industry pointed out that other countries successfully operate regional migration schemes that target the specific needs of their economies. There are workable options for more differentiation in the UK system. I would strongly encourage business to make their voice heard by responding to the white paper. It is important that the UK Government understands what business across the UK needs and what opportunities employers in Scotland see in a tailored approach to our requirements. The Minister for Business, Energy and Energy, Matt Fersen, last year commissioned an independent expert advisory group to review the policy options before the UK Government and consider the impact of those choices on areas of devolved responsibility in Scotland. They will provide their initial report next month and the minister will return to Parliament with their findings. The white paper is described as the UK's future skills-based immigration system. However, as the Immigration Law Practitioners Association pointed out, it has very little to do with skills or, even more importantly, little to do with social values. Instead, it envisages a narrow selective system based on wealth and the ability to pay and focus on cutting numbers at the expense of all else. Scotland has a different experience. We want to forge a different society, where the contribution of the nurse, the carer, the restaurant worker and the technician are all seen and valued as core to our society and economy. The UK immigration white paper is wrong-headed but it is also wrong-hearted. The cabinet secretary will now take questions on the issues raised in her statement. I intend to allow about 20 minutes for those questions, after which, as you know, we must move on to the next item of business, so if those members wish to ask questions, they can depress their request-to-speak buttons now. I call first Adam Tomkins, Mr Tomkins, please. Thank you, Presiding Officer. I thank the cabinet secretary for her early statement and there are some remarks in it with which I agree. I agree that, by and large, this Parliament debates matters relating to migration to this Parliament's credit, and I hope that that is continued this afternoon. I also agree with her urging Scottish Business and other important members of Scottish society to take part in this consultation exercise. It is important to underscore that the white paper that was published last month is a consultation document, and all of us should feel free to engage in that consultation process and to encourage others to do so. It is very important that the voice of Scottish Business is fully heard in this process. I want, if I may, to ask two questions to the cabinet secretary relating to her statement. In her Florence speech of September 2017, the Prime Minister said this. I want to repeat to all EU citizens who have made their lives in our country. We want you to stay, we value you, and we thank you for your contribution to our national life. The withdrawal agreement that has now been successfully negotiated by the Prime Minister and her team with the European Union provides exactly that, that all EU citizens lawfully residing in the United Kingdom at the end of the implementation period will be able to stay here in the United Kingdom. It also makes extensive, detailed and welcome provision for family members, for children and for dependents. The cabinet secretary referred in her statement to a hard Brexit. The way to avoid a hard Brexit is to vote for the Prime Minister's deal, which delivers exactly what the SNP has been calling for. I asked Ben Macpherson in December why his party colleagues in Westminster are preparing to vote against the deal rather than back it. He couldn't answer that question. I repeat the question today to the cabinet secretary. Why are the SNP not going to back this deal when it delivers exactly what the SNP has been calling for? The second question that I wish to ask is this. Both immigration experts and business groups have previously condemned the SNP's insistence that powers over migration be devolved to this Parliament, including the director of CBI Scotland, Food and Drink Federation Scotland, Scottish Chambers of Commerce and NFU Scotland. Given that the minister did not repeat her party's call for immigration powers to be devolved, does that mean that the SNP has finally listened to the experts and dropped this unwanted and dangerous policy? If so, that would be welcome. A number of issues. Can I make it clear that the problem with Theresa May's proposal and her deal is that, when it comes to aspects of freedom of movement, it would be as bad as no deal on the basis of ending freedom of movement. The majority of what I have laid out in my statement is the economic analysis about the freedom of movement being reduced and, under the white paper before us, which we are discussing, 85 per cent of those EU citizens that have been able to come here previously would not be able to come. That affects our health service. That affects so many parts of our businesses. It would be an economic disaster. In those simple terms, there are many other things that are wrong with Theresa May's deal, but in this one specific area that we are addressing here in this chamber, that alone shows you how bad Theresa May's deal is. Freedom of movement is vital to this country. In some of the other areas in relation to our proposals, we set out a very comprehensive paper. I published it in February last year, setting out what Scotland's proposals could be in relation to making sure that we had a tailor-made system. Yes, would we want more powers to this Parliament? Yes, we would, but we also want the powers to make sure that we can make policy. Even policy within the UK system would allow us to address some of the issues that we have. When we have differentials between salary levels, the median salary level in London is £32,000 in the society. It is £23,833 in Scotland. Those are absolutely material measures that will make a difference in terms of how the white paper would be implemented. It is why it is right that we need to make sure that people respond. In terms of what the CBI Scotland has said, the proposals that are outlined in the white paper do not meet Scotland's needs or the needs of the UK as a whole and would be a sucker punch for many firms right across the country. The UK cannot indulge in selective hearing. It tunes into business evidence on a disastrous Brexit no deal but tunes out from the economic damage of draconian blocks on access to vital overseas workers. We in this Government have tried to compromise in so many different ways over the past few months in relation to Brexit, but surely to goodness. One practical measure means by which businesses across Scotland are starting to understand that, at shape, a differential, tailored solution and policy within the UK system could help our economy surely to goodness, this chamber and this Parliament, with the Conservatives, could forge some kind of progress to make sure that we protect jobs, our health service and our economy. I understand why, but that was a five minute exchange. I have got 12 people, including Ms Baker, wanting to ask questions, so please can we have crisp questions and short answers as well, if appropriate. Not for you, you have got a time slot. Ms Baker, you have one minute to ask your question. Thank you, Presiding Officer, and I thank the Cabinet Secretary for Finance and the Cabinet Secretary for Finance and the Constitution. If we are exiting the EU under the proposed deal, or the disastrous no deal, we will see the end of freedom of movement. How do we retain the benefits that freedom of movement has given to Scotland? Our demographic challenge is demand that we do. The white paper fails to address Scotland's needs. It will restrict population growth, the proposed 30,000 threshold is unworkable, the 12-month visa is derisory and undervalues people and the commitment to immigration targets from the Prime Minister does not respond to the needs of key sectors in Scotland, perhaps not surprising given her approach when she was Home Secretary. We need flexibility within a UK framework. Other countries such as Canada and Australia have differentiation models that work. I fully appreciate how obdurate the UK Government is on this issue, but can I ask what work the Scottish Government has already undertaken to consider other models? Will the Cabinet Secretary commit to working with all parties to propose workable solutions that we can unite around? I thank Clare Baker for her question and the tone of her question. I think that she is absolutely correct in identifying that no deal or to his amazing deal would both remove freedom of movement, and that is the critical point. Other aspects that she touched on and what we can try to address are, I think that the issue about population is as critical as it is of migration. Even the white paper says that it is saying that there might be a 12-month visa for some skill base. That does not encourage people to settle, to stay, to have families, particularly in some of our real remote areas. A third of local authorities are going to see population decrease, so it is really important in terms of depopulation to address that. Her point about Parliament coming together, we have come together in many different ways. I would also point out that in terms of the previous administration, in terms of looking at students, for example, in some of the fresh talent initiative, that was another example where we could have a differentiated position in the UK system, perfectly possible. It is perfectly possible within this system, and she asked about what comparisons we have made. If you look at the February paper that we produced last year, we set out other countries and what they have done and what that can mean. That is doable and it is practical. There are so many things that are wrong with the UK system as a whole, and it is hostile environment and all the rest of it. In terms of practical issues, what we can do together—I sincerely hope that the Conservative Party in Scotland can come with us on that—is to work with business, work with the voluntary sector, work with our local authorities and our health service to make sure that we absolutely can maintain the workers that we have and retain them, but also recruit new workers as well. Under the UK Government's paid-to-stay policy, EU nationals must apply to remain here, facing charges of £65 per adult and £32.50 per child. If an organisation wishes to pay that fee on behalf of its employees, it faces a possible tax burden as a deemed taxable benefit. Does the cabinet secretary agree that, if organisations wish to pay the Tories' shameful status fee for their employees, they should be able to do so in a straightforward manner without additional charges? The cabinet secretary is proposing that workers are having to pay to stay with the rights to which they came and arrived here in the first place. She is right to identify when the problems are in the imposition of the fee. If there is to be a fee, we have said that the Scottish Government will pay for those devolved workers under our administrative responsibilities. Other employers want to pay that fee as well if it is imposed. We should scrap the fee, we should not have that in the first place, but if it is going to happen, organisations such as Key Thrill Airport, Oxford University and a number of NHS boards, Coluchi's restaurants chain, for example, have already said that they would want to pay, but they are going to be charged as a benefit and kind for their employees. There is not even the option to try and bulk pay it. It is retrograde in the first place, but even the incompetence of its application is causing difficulties. I agree with the member in that regard. The cabinet secretary mentioned the Migration Advisory Committee's report and the benefits of migration that it had, but it also said that a separate immigration system for Scotland was, I quote, not justified. They are not the only people to think that many business organisations think the same. Why are they also wrong on the issue? Why shouldn't we be working to get a system that works for every constituent part of the UK? Why won't you work with us on that? I should suggest that he reads the report properly. He should also listen to the businesses such as the Scottish Council of Development and Industry in terms of their comments about what we can and should be looking at other options if other countries have differentiated systems. We are not saying that I am not arguing at this point for a completely separate Scottish immigration system. I am arguing and have consistently argued over a considerable period of time. Had he bothered to read the February paper that we put forward, a proposal that would allow us to have policy decisions that are tailor made for Scotland that would make sure that we have and address the needs of our country, that we would take back control of our future in relation to the population needs of this country, for the employment needs for our industries and also for the social and care needs of our health service, vitally important it is. I would please ask the Conservative party to engage in two ways, to read the materials in front of them but to also engage constructively, as I think our businesses in Scotland would wish them to do. Bruce Crawford, followed by Pauline McNeill. The cabinet secretary is aware of the award-winning real food cafe in Tindrum, which is a fantastic example of a successful tourism-related business in my constituency. Around 70 per cent of the employees are from the EU. Many have stayed long-term and contribute hugely to the local economy. For example, one such employee is a retained fire worker. Does the minister share the deep concern of the tourism and hospitality sector in Scotland that the Tory post-Brexit migration policy could do serious harm to Scotland's rural economy? Yes, I do indeed. As the tourism secretary and the Scottish Government, I am acutely aware of the concerns of the tourism sector. He makes a very important point that it is about families settling and staying that is absolutely vital. It is also important to recall that the Migration Advisory Committee chair, convener, when he came to this Parliament, implied that it was something unproductive about tourism in Scotland. It is a vital part of the economy. It is essential that it is addressed. I was very pleased that the UK tourism minister, when I met him, agreed to engage with the chair of the Migration Advisory Committee to dispossess him of some of the views that he expressed to this Parliament's committee in relation to tourism. I have seven minutes and eight people want to ask questions, so I want short questions. Pauline McNeill, followed by Ross Greer. Does the cabinet secretary agree that there is a world of a difference between devolving immigration and the differentiated system of immigration? The two should not be confused. The case in point is that the 1700 EU nationals are demonstrating the need for Scotland to deal with this ageing population. Can I ask the cabinet secretary what contingency plans are there to ensure that social care services are established? I love you dearly, Ms McNeill, but I was hoping that you were setting a crisp example. I am going to be naughty now and hard on you, everybody, cabinet secretary. My health is suffering. I missed the end of that question, but she is absolutely right. We are trying to take a pragmatic approach. We are compromising on so much in trying to make sure that we put forward something that we can all come together on. There is a very immediate issue that has to be addressed. I am making sure that we have a tailor-made solution, tailor-made policies that can put forward a Scottish visa position for both salaries, for skill bases in that area. That would absolutely help our economy and is something that we want to do. We have been arguing for some time, and if only the Conservative party could start listening and paying attention, as Paul McNeill has. The UK's hostile environment system is regularly exploited by human traffickers, whose victims are disproportionately women. Given that expanding the system to European nationals will result in an increased number of human trafficking victims across the UK and here in Scotland, can I ask the cabinet secretary what consideration might have been given to the potential need to increase support services for victims of human trafficking? That is a very important point. Our great ramifications are not the most obvious ones in the economy and society in relation to ensuring that we have the right workforce, but it is how people can arrive here. I will draw to the attention of the justice secretary in any update that I can provide from the justice department, we will. Willie Rennie, followed by Joan McAlpine. The strawberry is left rotten in the fields of fife due to the wider economic impacts that will come from this immigration will be symbolic of the problems that will come with the UK Government policy. Does the minister not think that the UK Government needs to be straight with the British people about those economic impacts? Thank you, Mr Rennie. Charming is ever. Yes, cabinet secretary. Yes, I do. Even the provisions that they have this year for the whole of the UK would not be sufficient for the buried fields and the agricultural work in Angus to satisfy the workforce that is there, let alone the whole of Scotland, let alone the whole of the UK. He makes a very important point. When we have politicians talking about eating cheese and onion crisps, I think that that is a triviality that some people who have serious responsibility on the Conservative benches need to face up to when we are facing some of the issues that Willie Rennie talks about. Thank you. Professor Manning, who has been mentioned by the cabinet secretary, the chair of the Migration Advisory Committee, admitted to the culture tourism Europe and external affairs committee of this Parliament that he had done no modelling on the demographic or fiscal impacts of his proposals on Scotland and had done no in-depth study of differentiated migration systems in other countries such as Canada. Does the cabinet secretary agree with me that that invalidates the conclusions of the MAC, which dismissed differentiated migration? Can I just say that there is important evidence, which I quoted in my statement, about some of the labour force issues and the labour market issues in the Migration Advisory Committee, but she is right. The fundamental flaw in the Migration Advisory Committee's approach is that it does not tackle demographics and it does not tackle the fiscal consequences of lack of productivity economic growth because of population issues. It is why we want to make sure that population is key to the analysis that we are putting forward. It is not just about short-term gain, that is why the 12-month visa is unsatisfactory, because we do need to have longer-term settlement. We will draw again to the attention of the Migration Advisory Committee, but, as I have just said, I have already done that with one of the tourism ministers in the United Kingdom, because they have to understand that dealing with labour force analysis only will not tackle the needs of Scotland. Alexander Stewart will, by Annabelle Ewing. The statement indicates that all our projected population growth is due to come from migration over the next 25 years. How does the Scottish Government think that making Scotland the highest-taxed part of the United Kingdom will achieve that ambition? We are not the highest-taxed part of the United Kingdom. We have people who are paying less tax than the rest of the United Kingdom. It is important that we address things in the round. We have to be attractive. That is why we are encouraging people to live, to work and study and invest in Scotland. However, we need families. We need families to locate, and we need to make sure that we are not just saying that we can only come to Scotland if we earn more than £30,000. That is no way to bring in the bright technician, the bright researcher and all those who have the opportunities to build the entrepreneurial Scotland that we need. It is a mindset issue. The problem is that we have a Conservative Government that is ideologically bound on the issue and is not looking at the evidence and the economic evidence in particular. Annabelle Ewing, followed by Alex Rowley. Given that the clear message coming from business organisations in Scotland that the UK Government's white paper proposals would place businesses in severe jeopardy, is it not simply the case, cabinet secretary, that the Conservative party is putting dogma before rationality and the interests of our country? Cabinet secretary? I think that the member puts her finger on it, even with the limited progression of the Migration Advisory Committee in looking at population because they are only looking at the labour market issues. Even the evidence there shows that UK as a whole would be worse off. That is why it is essential that we pursue that on the evidence before us and the evidence before us that leads us to the position that we have to change. We are in the lucky position that people want to live and work in Scotland. That is why we see a movement from England to Scotland, people wanting to come to live and work in Scotland. We want that to be extended further and to make sure that we continue that provision. However, the rate of numbers of EU citizens coming to Scotland has declined significantly. We have not even left the EU and we have already seen the consequences of a flawed system. That is before the white paper is set before us. Some of the key sectors that the cabinet secretary talked about are dominated often by low pay, low terms and conditions. Does she agree that, where the Government can intervene such as a two-tier level terms and conditions and pay in social care, we should do so so that every job that people come to this country is a decent-paid job with decent terms and conditions? I agree. That is why, particularly in the social care sector, the fact that it was this Government that helped to extend the provision for care workers in particular to make sure that the real living wage was extended across that. He is right in saying that we want to ensure that we drive wages up, because everybody benefits from that. However, we have to do it in a responsible and sustainable way and we have to work with employers to do so. Currently, employers under this scheme are getting pressured that they will not necessarily have the labour force that they need. They will have rising costs because there will be less economic impact because of the white paper and Brexit more generally. However, reduction in the economic care GDP to the levels that I have talked about is £10 billion by 2014, because there is less money in the public purse from taxation to pay for nursing, social care and so on. It is the whole system that we have to look at. Briefly, Emma Harper. I practice the Scottish Government for seeing the proposed extension of the £30,000 minimum earnings rule on tier 2 visas. What impact will it have on public services in key economic sectors, including the agriculture sector, particularly in the south-west of Scotland, where we have 48 per cent of Scotland's dairy farms, many of which are reliant on the workers? That is lovely. We have got the percentage. Clearly, no area of business is untouched. The impact on the rural areas in particular will be absolutely catastrophic unless it is addressed. I pointed out previously that there is a limited agriculture workers pilot taking place just now. 2,500 workers for the whole of the UK would not even fill the vacancies in the whole of Angus. That is something that we have to make sure that the UK Government understands. However, if they are thrilled to think about this in ideological terms and not in evidence-based economic terms, they will not address that. Thank you. That concludes questions. We managed to get all questions in. Thank you very much and brief pause before we move on to the next item of business.