Migration cap is 'very damaging', says Cable

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A cabinet row is intensifying over the Government's controversial cap on immigration after one of its most senior members publicly hit out at the policy as "very damaging" to Britain's misfiring economy.

Vince Cable, the Business Secretary, has made no secret of his opposition to the plan, under which Britain will attempt to reduce significantly the number of immigrants arriving each year.

But he reopened a rift with Downing Street yesterday by repeating his concerns ahead of the Liberal Democrat conference this weekend. The party's MPs and rank-and-file members are vehemently opposed to the measure.

European Union law prevents the Government from blocking entry to migrants from most of Europe, but the cap will apply to those arriving from further afield. Mr Cable fears it is a political stunt that will block much-needed specialist workers from settling in Britain.

"The fact is that the way the system is currently being applied is very damaging," Mr Cable said.

"We have now lots of case studies of companies which are either not investing or just not able to function effectively because they cannot get key staff – management, specialist engineers and so on – from outside the European Union."

Downing Street hit back at the suggestion the policy was stalling recovery. "I don't think that there is evidence that it is doing huge damage to the UK economy," the Prime Minister's official spokesman said.

"There is a clear Coalition policy on this and that was established pretty much on day one." He added that all concerns would be taken into account when final decisions were made on the immigration quota. A temporary cap was put in place in July. The Government is committed to making it permanent.

Yesterday, Labour pounced on the comments as evidence the two coalition partners were "hopelessly at sea" over immigration. "They have said they want to promote trade then sent out a signal that talent from overseas is not welcome in the UK," said Pat McFadden, the shadow Business Secretary.