Leading article: A proposal that would make a bad immigration policy worse

There is something jarring about the intervention over the weekend by the junior minister Phil Woolas. The global financial system remains in the grip of a dangerous crisis. Politics in Britain is in flux. And, in this febrile environment, Mr Woolas has decided to poke a stick into perhaps the most sensitive area of the British political brain: immigration.

Mr Woolas gave an interview in which he argued that: "It's been too easy to get into this country in the past and it's going to get harder". As if trashing his own Government's record over the past decade were not enough, the minister took the opportunity to announce an entirely new policy: capping the UK population at 70 million.

This is big stuff. Mr Woolas seems to be unilaterally jettisoning the new government policy, four years in the making, which will decide immigration applications through a skill-based points system. What the minister outlined this weekend sounds closer to the Conservatives' proposed quota system.

So exactly what is Mr Woolas trying to achieve with this radical new approach, apparently put together in some haste? A generous interpretation would be that, as Britain teeters on the brink of recession, he is trying to pre-empt the emergence of an ugly public mood towards migrants by reinforcing the message that the Government has the situation firmly under control.

A less generous interpretation would be that Mr Woolas is playing politics with fear, at a time when governments everywhere ought to be behaving with extreme sensitivity. Sadly, the new Immigration minister's boast that "I've been brought in to be tougher and change perceptions" would seem to support the latter view.

But, whatever the truth, there is profound confusion in the minister''s remarks. According to Mr Woolas, "clearly, if people are being made unemployed, the question of immigration becomes extremely thorny". That might seem to be a truism, but the relationship between rising unemployment and public discontent over immigration is not as "clear" as Mr Woolas implies.

It is perfectly true, as official figures last week demonstrated, that unemployment is once again on the rise in Britain. And the numbers of those seeking work are only likely to increase as the shock of the debt meltdown works its way though our economy. But the truth is that Britain's flexible immigration policies of recent years are likely to help matters, rather than make them worse. As the demand for labour reduces, many Polish plumbers and Lithuanian vegetable pickers are already returning home. Our flexible labour markets are a safety valve that Britain simply did not have going into previous downturns.

This points to broader truth that opponents of immigration have always been loath to accept: that strong flows of foreign workers into Britain have been, first and foremost, a result of healthy growth. In the boom times, inflows were high because demand was robust. In a recession they will fall because demand will diminish. The market will find its own level.

This is why the Government's points system is wrongheaded. It attempts to pre-empt the demands of the labour market by imposing central controls on the flow of labour. That is merely a recipe for inefficiency and unfairness. Now Mr Woolas seems determined to replace an already flawed system with one that is even more damagingly restrictive. The new Immigration minister has succeeded in his goal of changing perceptions. But sadly for Britain, Mr Woolas has done this by promising to make a bad policy worse.