Sorting out the public finances Part 2 – Every part of the UK to pay its own way

The only thing more depressing than looking at the hard economic facts about our lowest performing regions is listening to the debate about how to solve the problems. There are two strands to this current debate. Firstly, there is a repetitive list of non-radical solutions (e.g. building new R&D facilities) to be found in all the Local Enterprise Partnership plans submitted yesterday to the Government. My reaction to these sort of solutions is the same as when an acquaintance told me that she was rejecting the normal treatment for cancer (aggressive surgery, chemo, radium, etc) and opting for the much more pleasant route of homeopathy. I wished her well and understood her horror at the thought of radical treatment. But I knew the statistics were against her. Such is the depth of the challenges in our low performing areas that only radical treatment will work. Secondly, there is a near universal clamour now for more devolution of power and money to the local level in the low performing areas. But this usually means devolving decisions on how to spend public money and how much to borrow, assuming that the tab will stick be picked up by others. Credible devolution has to based on requiring local areas to balance their budget locally. The problem underlying these two issues (avoidance of radical treatment and disbelief that low performing areas could ever balance their budget) is the lack of political leadership at a local level: the ability to own and explain the scale of the problem, to act swiftly and fundamentally to find solutions and to get people on board with the changes necessary. Oncologists have learnt how to do this. How could we rapidly help political leaders to be able to bring the right medicine to their areas? And, given it’s hard, do we really need to confront the problem?

At the height of its recent crisis, Greece had a fiscal deficit of 15%. This drew worldwide attention, threatened the European banking system and required an international bail-out in exchange for a brutal turnaround plan, supervised by the Troika of the IMF, the EU and the ECB. The UK’s deficit was also unsustainable, standing at 10% in 2011. However, this national average hid the fact that half of the UK had deficits which were as bad as Greece, or much worse. This meant that almost 3 times as many people in the UK lived in regions with worse deficits than Greece, with its population of just 11m. Three parts of the UK stand out, with 2011 deficits which were more than twice the level reached by Greece – Northern Ireland (39%), Wales (36%) or the North East (32%). But the rest of the North of England (NW and Yorkshire & Humberside) and the Midlands had higher deficits than Greece. By contrast, in 2011 London and the South East were in surplus, whilst Scotland, the East of England and the South West had UK average levels of deficit, albeit it at c10% they were high. A recent study suggests that Greater Manchester, one of the more successful cities in the North, is currently running an annual deficit of £5 billion per year, which would require local people to earn 30% more in wages and profits to break even. Whilst the deficit areas of the UK are now (rightly) asking for more devolution of power and financial responsibility, it is important to note that, ironically, it is only our highly centralised system of government which has stopped these areas going completely bust. Not only would 20-40% deficits have been unacceptable to lenders being asked to fill the gap in regional finances, but if these areas had had to do their own borrowing then the weakest of the areas (running a 20% deficit over 30 years) would find that the majority of their spending today would be on debt interest payments, leaving only 3rd world levels of funding for pensions, health, education, etc. Of course, the lenders would have called time on this situation many years ago, causing a collapse of Argentinian proportions.

There is a lot to do to solve the long-term problems we face. But I propose 3 things which I think are big enough to be game changing:

1. Legislate so that public spending and tax balance in each and every part of the UK within 15 years

We can’t just take regional fiscal deficits for granted – and we don’t need to. Given that the UK needs to balance its budget, it’s no way to run a country if half of it can’t pay its way – particularly if the situation is going to get worse. The main lesson of the Great Financial Crisis for the West was that someone always has to pay. At the moment the deficit areas of the UK have relied on income transfers from London and the South East. But clearly this isn’t enough, which is why the country still has one of the highest deficits in the developed world, in spite of tough cuts over the last few years. Even when the national deficit is eliminated in 2018, this will disguise the ongoing structural deficits in half of the country, some of which will remain in excess of Greece’s deepest crisis. Even if the south of the country could afford to subsidise the rest (which I doubt), it is a very risky strategy for the UK as there are many competitive threats to London and the South East. We all know what happened when we relied on the City of London to pay for the rest of the country’s public spending – it was great whilst it lasted and disastrous when global events turned against us.

So, my proposal is that every nation (Scotland, Wales, NI) and every region of England is required by law to balance its spending and revenue by 2030 and make prescribed progress every 3 years to this 15 year goal. This would include all spending – pensions, health, education, benefits, policing, local authority services, etc – with the exception of capital spending on economic infrastructure. The latter is lumpy (e.g. a high speed railway happens once in a generation) and a genuine investment in economic growth. The taxes (and other revenues) collected in the area would need to cover spending – eliminating any structural deficit. Rules would be set to allow for the economic cycle – small surpluses in good times, small deficits in bad times. Tough rules would also be set to force local areas to sort out their balance sheet – e.g. selling off their social homes given that market rents and social rents are similar in these areas, releasing tens of billions of pounds to reinvest in economic infrastructure like rapid transport links between Northern cities. The nation or region would be given a high level of fiscal devolution, as the only way to balance the budget is to increase taxes or reduce spending. This would be a dramatic step for the UK, which has about the lowest level of sub-national fiscal devolution of any developed country. But it’s necessary. And it’s also obviously possible, as we are going in that direction with Scotland. Irrespective of the independence vote, Scotland already controls the majority of public spending and is about to take on responsibility for the levels of income tax collected in Scotland, taking on the risk and reward of them rising or falling.

My law gives power and accountability to the national governments, but insist that the UK Secretary of State for each nation was equally obliged to achieve the fiscal balance. The national governments and the relevant SoS would be obliged to produce a 15 year plan, with 3 year milestones towards balancing the budget. This would need to be validated by the Office for Budget Responsibility (OBR). There would need to be a rolling 3 year budget, which is on track to hit the 3 year milestone. This would be validated by the relevant National Auditor. It is not so immediately easy to choose who should be in charge in the English regions. Ideally, there would, as in London, be strong Mayors leading the metropolitan city regions (Greater Manchester, South Yorkshire, etc). But there aren’t. There is lots of current debate about this. Well, maybe, we just need to bite the bullet and do it. One answer would be say that unless a city region chooses to have a Metro Mayor, then a Government Minister would be put in charge of balancing the budget in each city region. He or she would be democratically accountable, but clearly it’s less attractive than a directly elected local politician.

The UK Government would still play a vital role in tax and spend. Firstly, it would still have key national responsibilities, like defence and national security, national transport, economic regulation, etc. Secondly, it would put the financial might of the whole of the UK behind each nation and region’s fiscal position, issuing national bonds, managing the cash flow of spending and revenues, dealing with shocks to the system. Thirdly, it would do much of the administration for nations and regions, such as collecting taxes, paying pensions, etc – but they would pick up the tab in their locally balanced budget.

This fiscal devolution is tough medicine. But it also treats people like grown ups. We have seen how local government and the police have responded in the last few years to having to make large cuts in spend, in exchange for more freedom to make the best local fist of it. At the heart of this devolution is local political leadership and its ability to engage local people in the difficult choices in making the books balance. Much of this is about who pays what tax (e.g. more freedom on council tax rates or National Insurance charges), what levels of entitlement can be afforded (e.g. whether benefit rates or public sector pay should be regional rather than national) and which types of public spending are the real local priorities. But of course, the big opportunity to change the deficit lies in improving the local economy. My other proposals focus on the best ways to do this.

2. Double the number of 25-34 year olds in the designated regions within 15 years

There is a demographic crisis in the deficit areas. Overall population levels are predicted to be either static or have modest growth. But this disguises the problem. On the one hand, the population is growing because people are living longer. And this is what drives public spending – on pensions, on health care, social care, etc. On the other hand, in many areas, the working population is declining. And this is what causes tax revenues to decline. This is the worst possible vicious circle for a future deficit, let alone the local economy. We can see this clearly by looking at the Old Age Support Ratio, i.e. the ratio of the working age population to the retired population. In Leeds, for example, this is currently 3.2 (i.e. 3 times as many working age people as retired). But in 20 years time it will fall to 1.7. Even putting up the retirement age to 70 is not enough to maintain the current ratio. (It would need to be 72).

But why isn’t there a demographic crisis in the South? The answer is simple, if politically uncomfortable. More than a third of London’s residents were born overseas – compared to 1 in 20 in the North East. Indeed, there are now more foreign born people in London than there are residents of any description in the North East! London and the South East have about a quarter of the UK’s overall population but more than half of the foreign born residents. The pace of this divergence between the South and the rest of the UK has really accelerated in the last 15 years. A telling statistic is that until 2001, the North West had a bigger population than London. Now London has 1m more people. It has grown. The North West has been static (like the North East and Wales). 1m more foreign-born residents moved into London in this period. Merseyside, for example, attracted just 29,000 additional foreign born residents between 1995 and 2012. Its working age population will fall by up to 15% over the next 20 years.

It’s very hard to see how the deficit areas can turn themselves around without a major inward migration of working age people. The critical group to attract is the 25-34 year olds. These are the wealth creators, who have turned around many cities in the world – including London. Given the challenges facing the deficit areas, there is a need for a massive increase in the size of this group and it is urgent. Therefore, I propose a target of doubling the size of the age group in the deficit areas within 15 years. That would add about 10-15% to the total population in each of the areas. This is the sort of growth that London and the South East have experienced in the last 15 years. Starting in 2015, this could be a “15 in 15 from 15” strategy.

Where will all these people come from? Well, it’s too late to start breeding, as today’s new born won’t join the labour force in the next 15 years. So it means attracting young people from elsewhere. Partly this can be from other parts of the UK, especially the South. We could adopt a number of targeted policies to achieve this. For example, many of the deficit areas attract large numbers of students, but then struggle to retain them once they graduate. Perhaps we should offer a 5 or 10 year holiday on repaying student loans for those stay in the area to which they moved to study? Perhaps we could offer government backed mortgages for first time buyers who relocate into the area, where payments start low and rise in line with inflation over 25 years (rather than the current opposite which undermines home ownership aspirations for all)? But a large part of the increase will probably have to come from immigration. Let’s save a full argument about immigration for another post. Suffice to say here that I think we need high levels of immigration for 2 reasons – our ageing population and our need to attract the world’s best to the UK – but it needs to be the right immigration, so we need much more control of who comes to the country. In this spirit, one answer to the problems of the North would be offer location-specific visas, entitling people to live and work in a named city or region. This isn’t as impractical as it may first sound. We already do this for the largest group of visa holders – students. A visa is tied to a particular course at at a particular university – if the student fails to attend or leaves the university, the visa is revoked. So it’s entirely feasible to do this for designated areas of the country, perhaps attaching a visa to a job / running a business and payment of Council Tax in the area. This doesn’t just mean offering visas to non EU countries (e.g. to the young Australians, Canadians and South Americans) and seeing what happens. It should also mean investing very heavily in head-hunting the best in the world. Silicon Valley is what it is in large part due to the active recruitment of India’s best software engineers. Why don’t our deficit areas employ headhunters and offer incentives to the world’s smartest 25-28 year olds – the products of the world’s best universities in design, business, applied science, etc and those trained by the world’s best corporations. They aren’t hard to find, but they need a hard sell … and visas.

There is clearly also a hard sell needed within the deficit areas to convince people, who feel that there aren’t enough jobs or public services for those who already live there and believe, wrongly but passionately, that more people moving into the area will just make everyone worse off. It’s not easy to explain the complexity of labour market economics or fiscal sustainability. Let’s try a one word explanation – “Suarez”. The immigration of a Uruguyan into Liverpool has transformed the fortunes of the football club and the morale of at least half of the city. It has also lifted the global status of the city. (The other half of the city has been cheered by the genius of their new Spanish manager.) As Liverpool are poised to win the Premier League, I haven’t heard many local voices calling for South Americans to be sent home so a local lad can have the job! We need the same attitude to the economy as we have to football – busting a gut to get the world’s best people to come, in large numbers, to our deficit areas.

3. Create a bigger private sector in the deficit areas

In half of the country, less than half of working age adults work in the private sector economy. In South East, the richest region, two-thirds of working age adults work in the private economy. In South Wales, it less than a third. Throughout our northern cities (and the largest cities in the Midlands), 6 out of 10 working age adults are not working in the private sector. This includes major business centres like Manchester and Birmingham.

How can we possibly balance our national budget if this continues? One-third of the population is retired, the school leaving age has been raised to 18 … so how can we pay our way if less than half of the working age adults are employed in the private economy? The first problem is simply that in the deficit areas not enough people work, irrespective of who they work for. In the most prosperous parts of the country 9 out of 10 working age adults are in employment. In some of biggest Northern and Midlands cities, this falls less than 6 out of 10. The second problem is that not enough people work in the private sector. The average UK ratio of private to public jobs is 3:1, i.e. three-quarters of jobs are in the private sector. In the most successful areas of the UK, there are 6 private sector jobs for each 1 in the public sector. In the deficit areas many areas struggle to achieve 2:1. In Cardiff and Swansea, for example, there are only 3 private sector jobs for every 2 in the public sector. The problem is not too many public sector jobs. It’s a shortage of private sector jobs. Often the areas with a high proportion of jobs in the public sector have the lowest levels of people working in any sector. One rapid answer to this problem is to move the public sector into the private sector. This is not ideology, but pragmatism. Local public bodies rarely bring any income into the area – they just meet local need. But turn them into real businesses and they will be incentivised to draw business into their area (e.g. taking over the back office functions of public bodies in the high cost South East; attracting overseas private patients into local hospitals; diversifying from public revenues to win private sector business like the Teachers Pension Agency in Darlington has done by winning work from the life insurance industry in London; etc). One would expect the deficit areas (with lower costs and slack labour markets) to have attracted a lot of outsourced activity from higher cost, tighter labour markets. However, the opposite is true. London and the South East earn twice as much income (wages and profits) from outsourced businesses as the North West, Wales and Northern Ireland. Not only does privatising public services offer the chance to bring in external revenue, it also gives a unique opportunity for a dramatic shift in culture in the deficit areas from a public sector focus to a new entrepreneurial era. But this won’t come by simply asking large, Southern based corporations to take over public bodies. My proposal is that we mandate, within 3 years, the transfer of public services (apart from the police) to new employee-owned businesses. The models for this in the private sector are outstanding – world class organisations like John Lewis and Arup. Having our teachers, doctors, nurses, social workers, highways engineers, etc owning their own company and having to compete for contracts every few years would mark a historical change in the economy and culture of the deficit areas.

Conclusion

This is radical treatment. And probably no more popular with many people than being told they need radical medical treatment! But balancing the books, importing a workforce that can pay for the ageing society and turning millions of public sector staff into business owners are the sort of measures which could change the survival rates of our struggling areas and, just as importantly, ensure that the whole country can pay its own way. I am not naive about how hard this is for any politicians. And before my radicalism is dismissed as Southern arrogance, I would note that I spent the first 25 years of my life in the North West. When I was little my dad and grandad both worked on the Liverpool docks, then as they were closing we moved for a new job in a factory in the false dawn that was Skelmersdale New Town, where within 15 years most of the new factories closed down too. So I know this is a tough assignment, but I also feel passionately that it must be grasped.

Advertisements

Would it be better if our top talent emigrated … for a while, at least?

 

If (or as I fear, when) England fail to make the final stages of the World Cup in Rio, the post-mortem is predictable:  “We need fewer foreign players in the Premier League. We need quotas so that the majority of the players are English. Something must be done, and done immediately.”. Without being defeatist, it is worth heading off this knee-jerk response before the plane leaves for Brazil. Partly because it would be disastrous for one of the UK’s greatest success stories – the modern Premier League. But more importantly because this debate illuminates some important, but little talked about aspects of migration policy. 

Let’s look at the football situation. It’s clearly true that English players are a minority in the Premier League. They played only 32% of the total minutes played last year. 68% of players are not English. The foreigners come from all over the world. The largest contingent is the French and the Spanish, but they only have 10% each. The UK is not unique. If we look at the European nations most likely to make the World Cup final, then their percentage of overseas players has been growing. In spite of being the biggest country in Europe, only 50% of the minutes played in Germany’s top league were played by Germans. The equivalent figure is 59% in Spain. The high performing European nations and leagues are big importers of global talent. (If, however, we look at countries that didn’t make the world cup, the story is the opposite. Close to home, we can see that in Scotland 85% of the minutes played were from Brits.) Clearly it wasn’t always like this. In 1992, there were just 11 foreign players in the Premier League. Today there are more than 11 Brazilians playing in the same league, and even more Belgians. The other way to tell this story is to look at the various national teams. In 2013, 9 of the Spanish squad played abroad, 23 of the Uruguyans, 11 of the Dutch, 16 of the Portuguese and the Brazilian and 20 of the Belgians. By contrast, the English squad had 1 who played outside England – Fraser Forster and he played in, ermm, Scotland! And it is this last point which speaks volumes about  England’s failure to participate in the global economy of football. Across all the European leagues, I can think of only 3 English players earning their living by playing in Europe! It is incredible that of all the thousands of young men who crave a career in professional football and who bemoan the lack of space in the Premier League for English players, only 3 of them have gone abroad!

The wider lessons of the Premier League for our migration debate are:

(1) On the immigration front, when we attract the best people in the world to come to the UK, they push up wages, they drive exports, they create global brands and they attract investment. They bring money into the country, as overseas spending follows them around. Much of the Premier League’s value lies in its ability to pull in overseas payments for TV rights, replica kit, etc. Nearly 1m football tourists visit the UK, spending more than £700m a year. The League and its clubs pay over £1bn in taxes and the overseas players spend part of their earnings in the UK. This impact is replicated in other key industries where countries compete to attract a footloose global elite of professionals. The desire and need for the world’s elites to cluster together means that virtuous (or vicious) circles are created as locations rise (or fall) as global magnets for talent. We can readily think of the UK’s success in the glamourous worlds of science, advertising, architecture,fashion design, academia, investment funds, film and theatre, Formula 1 engineers, top surgeons, pop music, TV formats, etc. But is is also true of the less glamourous elite pools which are vital to our comparative advantage as a nation – actuaries,  data scientists, accountants, agronomists, car part designers, aerospace engineers, etc. 

(2)But this is only half the story. There is a big difference between having a Premier League at home through importing talent and becoming World Cup Champions by a having a big enough national talent pool which earns its living at home and abroad. This is true for the other global elite talent pools where, to use a footballing term, UK talent needs to play away as well as at home. If we want the best talent pools in the world, then we need to start worrying about getting the right emigration as well as immigration. This sounds counter-intuitive – why would we encourage our best people to leave the country? Well, much of our emigration is short-term – to count as emigration, people need to leave for 12 months or more. But the majority come back after working or studying abroad for a number of years. 90% of emigration is of working age adults. In 2011, for example,150,000 British citizens emigrated but 100,000 also returned, leaving a net migration of 50,000. Interestingly, British emigration increases in the good economic times – it is something people do when they feel strong, not weak. So when we say more emigration of our elite people is a good thing – it’s about them getting experience and opportunities they can’t get in the UK, before coming back again as even greater talents and wealthier than when they left. And if they don’t come back, we should see them as a ready source of global contacts to assist our international trade and liaison.

So if emigration of our best people can be a good thing, do we have enough of it? Compared to other countries we actually have lots of emigration. About 5m British born people live abroad. Of the high income OECD countries, the UK has the largest number of citizens living abroad, far more than those born in Germany or the US, for example. By proportion, Portugal, Greece and Ireland have higher percentages living abroad, but from smaller populations. If we look at countries with large numbers of immigrants to the UK, it is interesting to note that Poland and the UK have the same proportion of their population living abroad, whilst the number of Pakistanis living abroad is about the same as the number of British. But it is salutary to look at where the Brits go. The biggest destination is Australia – approaching half of all emigration in 2010, with the US coming second. Indeed, two-thirds of British born citizens living abroad are in the Anglophone countries. (Unfortunately, these countries are not very good at football, or we’d be fine for the World Cup!). About 15% of British born citizens are in Spain, France or Germany. Beyond this, the numbers per country are small. Why this matters is that the numbers are tiny in the emerging economies, which have the highest growth potential. The BRICS (Brazil, Russia, India, China) countries have about 80,000 British born people living there, less than 2% of those Brits living abroad. There are 10 times as many Brits living in New Zealand as in either India or China. The same is true of the MINT countries (Mexico, Indonesia, Nigeria, Thailand) with some 70,000 or so Brits, over half of whom are in Thailand. So whilst we have lots of emigrants, we don’t necessarily have the right sort of emigrants in the right places.

If we accept the counter-intuitive argument that we should encourage our best people to leave the country for a while, what might this mean:

(1) Should we be encouraging more of our students to study overseas? If we want our talent pool to be the best in the world, then shouldn’t we make sure that our best students go to the best universities in the world? Other countries do just that (e.g. a quarter of international students at US universities are from China). If we look at the all important STEM subjects (Science, Technology, Engineering, Maths), then in almost every subject the UK has 2 of the top 20 universities in the world. On the one hand, this is a good achievement. On the other hand, in most subjects the US has between 14 and 18 of the top 20 universities. So why wouldn’t we want our best students to go to those universities to be a part of the global elite? But in 2011, whilst the UK had a a Premier League performance in attracting overseas students here (13% market share, second only to the US on 23%) and 2m UK residents were registered students with UK universities, only 6,000 UK residents went abroad to study. If we see higher education as a global product for sale (as many other countries do), then why are so protectionist about keeping UK demand in the UK? In other markets, we see global competition as good for UK consumers and good competitive pressure on UK suppliers. So, maybe we should worry about being under-represented in the world’s best universities and push our best HE consumers to buy overseas?

(2) If we want to sell more services to the emerging economies, how do we get more Brits to emigrate there for a while? Selling services overseas is hard work. Unlike making a car in Sunderland and putting it on a ship, services often have to be delivered, at least in part, in the other country. They require cultural insight and adaptation. Sales rely on personal relationships and interaction with the overseas buyers. And, like football, they rely on having the best global talent. It also means that much of the revenue from sold services stays overseas, paying for local delivery. Many economists are dismissive about the potential for services to pay our way in the world. But we don’t have any choice. Unlike Australia, Russia or Canada, we don’t have masses of natural resources to export. Unlike Germany we don’t have enough manufacturing exports (yet, at least) to buy what we want from the rest of the world. But we are good at services. Just think (in terms of A-Z), of the services beginning with an A, where we are world class – architecture, advertising, accountancy, actuaries, agronomy, arts, academia, etc. The UK share of global exports of services is 6.4%. Not too bad? But our share has fallen by 20% since 2000. Meanwhile Germany has increased its share by 10%. And our share of trade more generally with the growing emerging economies is under pressure. For example, our share of India’s imports has halved in the last decade. There is a need to have plenty of Brits on the ground in our export markets. As outlined above, we lack these numbers in the emerging economies. And in our mature markets and popular destinations for our emigrants, the emerging countries are themselves are pushing us out of place. 60% of permanent resident visas in Australia are now granted to Chinese, who will soon replace the British as the biggest immigrant group. Indeed they already have in Sydney. Even more strikingly, the emerging economies are rapidly populating the next generation of emerging economies. In the last 10 years, more than 1m Chinese workers have moved into sub-Saharan Africa working for 2,000 Chinese companies. Do we need a concerted campaign to encourage British talent to spend time abroad? “Go East Young Man”? Should we offer grants, tax breaks, remission from student loans, etc to individual British talent who go on time limited economic visas to our target countries? Should we offer similar assistance to UK employers who are exporting British talent into our target countries?

(3) If we want to tackle our skill gaps, rather than relying on short-term imports should be relying on long-term exports? The Home Office publishes a formal list of very specific shortage occupations, where it will allow immigration from non EU countries. Looking at the 2013 statement, it is clear that the shortages largely result from sporadic historic demand for those skills in the UK domestic market. It is equally clear that that there has been and continues to be demand for those skills overseas. If there had been more people willing to work overseas as well as in the UK, then we could have had a much larger British talent pool in these shortage areas. For example, we don’t have enough railway signals engineers. We get into a circular argument about spending more on railway engineering, where we keep spend low because skills supply is low. But if we increased total demand for these skills by more people working overseas for periods of time, then the supply pool could be increased.The 2013 Home Office statement lists similar examples – geologists and drilling engineers for oil and gas; tunnelling skills; electricity transmission engineers. UK infrastructure spend will increase over the next 5-15 years. But it will dwarfed by massive infrastructure investment in Asia and Africa. Total demand in the world will grow sharply. But will our supply of skilled people increase so that we can go out and fight for our share of this overseas investment, as well as deliver what we need here? This means signalling this demand to our workforce, so that they get themselves skilled and gear themselves up for overseas work. It also means unblocking constraints on numbers getting trained (e.g. university places, professional regulation, etc) and preparing our talent for the world, rather than UK, market. Clearly, the point of exporting talent is to have more of it, not less, so more emigration of our best people only makes sense if we make sure that the total number of British people participating in global elites increases.

(4) And finally, of course, it means more British footballers getting in their Bentley (for the established ones) or onto Ryanair (for the less established ones) and playing overseas. That would give us a bigger pool of talent playing at the highest level across Europe.

The current migration debate is very focused on net immigration. But we also need to look at the other half of the equation – the emigration. In the same way that we measure and debate the numbers coming in, do we need to measure the participation rate of British citizens (vs our competitors) in the elite opportunities open to British talent around the world – whether those opportunities are in medicine, constructing infrastructure, studying at the top universities, data science, pop music or …. football? Let’s hope that in terms of the wider economy by 2018, we have got on top of immigration so that we have a Premier League in all chosen industries. But let’s also hope that we are winning the World Cup in those chosen industries because of the size of our talent pool, which has grown by enthusiastic, time limited emigration giving us access to overseas markets.