Scotland’s government and business community has declared it is unhappy with the immigration cuts being imposed by the UK government and wants a more flexible approach.

A letter from the Scottish Government and business and industry leaders says that the tough new UK Visa caps will damage economic recovery.

They want Scotland to have the power to vary the level of immigration to meet its needs as it has a larger proportion of small businesses and a different labour market from the rest of the UK.

In the letter to UK Immigration Minister Damian Green they say that the implementation of the new annual limit in Scotland will have a negative effect on Scottish businesses, labour market and economy.

‘A limit on net non-EEA (European economic area) migration to bring it to the level of tens of thousands a year is likely to impede Scotland’s economic recovery and distort that labour market,’ the letter states.

The letter, signed by the Scottish Chambers of Commerce, Institute of Directors in Scotland, Federation of Small Businesses, Universities Scotland, NHS Scotland, Cosla, the Scottish Trade Union Congress and Scottish Social Services Council, warns that it will impact on creative industries, energy, financial and public services, life sciences and tourism.

‘We are deeply concerned about the damaging impact the annual limit will have on the Scottish economy. Scottish businesses, employers, universities and the NHS share our concerns that the UK proposal is not right for Scotland,’ said Scottish External Affairs Minister Fiona Hyslop.

‘We need a flexible approach to immigration. A regional variation, in line with the Calman recommendations, is the best way to support Scottish business and economic growth. To ensure sustainable economic growth and the success of our economy’s key sectors, we must be able to attract and retain world-class talent,’ she explained.

‘The immigration cap will do the opposite. It will have a negative impact on business investment. It will hit our key sectors and small businesses particularly hard. It will target high-earning immigrants who pay tax in this country. It will put Scotland at a competitive disadvantage and our economy will suffer.

‘I am alarmed that the Home Secretary believes that reducing net migration from the hundreds of thousands to the tens of thousands can only be achieved by cutting net migration under the study and family routes. Recruitment of international students is integral to Scottish universities’ contribution to our economy, cultural and social development, as well as our international profile,’ she added.

Universities Scotland said that nearly 2,500 staff in Scotland’s universities, about one in 10 of all academic staff in Scotland’s universities, are from outside the EU. It believes that the cap would turn off the tap of talent from the United States, China, India and Australia that has bolstered research and teaching at Scottish universities in areas such as life sciences in Dundee and Edinburgh and engineering at Heriot Watt.

The UK will introduce a permanent annual UK Visa cap on immigration in April next year as well as tightening up immigration rules that will result in a cut in work permits for workers from outside the European Union.