Reeves appoints increased pay advocate to struggle abilities shortages as chief financial adviser

[ad_1] Rachel Reeves has appointed a labour market knowledgeable who has repeatedly referred to as for higher pay and circumstances in key sectors, reminiscent of social care, to scale back the UK’s reliance on migrant staff as her new chief financial adviser.

Prof Brian Bell, who chairs the unbiased Migration Advisory Committee (MAC), which advises the federal government, has been introduced as the brand new chief financial adviser within the Treasury – a senior civil service function.

He'll take up the publish simply because the UK financial system is adjusting to a plunge in web migration, which fell by greater than two-thirds, to 204,000, within the yr to June 2025.

Some economists have predicted an extra decline, in direction of zero web migration – however Bell rejects that forecast, anticipating it to bounce again in direction of 300,000 a yr by the top of the last decade.

A professor of economics at King’s School London, Bell has used his function on the MAC to make the purpose that the “abilities shortages” bemoaned by UK employers could usually mirror the failure to supply adequate phrases and circumstances to home staff.

In its 2024 annual report, after Labour got here to energy, the MAC welcomed the brand new authorities’s give attention to abilities coverage because it sought to scale back web migration.

But it surely additionally warned: “Many sectors exhibit excessive ranges of immigration not simply resulting from abilities shortages however on account of poor pay and dealing circumstances which trigger low engagement from the home workforce.”

It added: “The home workforce with related abilities could also be unwilling to produce their labour for the wage and dealing circumstances on provide from employers.”

Bell has additionally argued stridently for higher pay in social care. In an interview with the Guardian in 2023, when the Conservatives had been nonetheless in energy, he accused ministers of getting “no curiosity” within the circumstances confronted by staff within the sector.

“They might not say it explicitly, however I believe they mainly consider that care staff must be paid lower than individuals who stack cabinets for Aldi – as a result of that’s what their coverage is,” he stated, accusing the federal government of counting on immigration as a “crutch”.

Bell added: “We’re not doing something on the wages entrance, and till we do this, then we're accepting that exploitation as a part of the way in which that we’re going to pay for social care: and that simply appears appalling.”

Labour is establishing a brand new negotiating physique for social care, which goals to agree a good pay settlement that can develop into the statutory minimal throughout the sector. However it's not resulting from come into power till 2028, and sector specialists have stated the £500m put aside to pay for it won't be ample. The broader difficulty of how one can fund social care is being reviewed by the cross-bench peer Louise Casey, who just isn't anticipated to report till the run-up to the following normal election.

Talking on a panel on the Bristol competition of economics final yr, Bell argued that speedy will increase within the variety of individuals coming into the nation usually mirror wider coverage challenges.

“It’s virtually at all times that the place there’s huge immigration numbers, the issue is elsewhere in authorities not addressing an underlying downside,” he stated.

Bell’s appointment comes amid a wider refresh of the chancellor’s advisers. Neil Amin-Smith, as soon as the violinist for the pop band Clear Bandit and now an economist, was lately made chair of her council of financial advisers, which is made up of political appointees somewhat than civil servants.

Reeves stated: “Via stability, funding and reform, this authorities has the precise plan for our financial system and the appointment of Prof Brian Bell will strengthen our financial management as we ship for working individuals.”