A two-tier system will allow only skilled workers to settle, with the unskilled expected to stay for only short periods of time and then leave. Even skilled workers will have to pass tests in English language and knowledge of British life before being allowed to stay.

The waiting period for skilled workers wishing to remain permanently is to be extended from four to five years.

Charles Clarke, the Home Secretary, said that immigration and the asylum system needed to be more transparent. “I believe it is the lack of clarity about the system that allows various forms of bigotry to develop,” he told a press conference at the Home Office.

Mr Clarke said that his proposals were unlikely to greatly affect the overall numbers of migrants. The number of migrants was about right in some categories but the number of unfounded asylum applications was still too high.

He admitted that the Government had failed to handle returns of failed asylum-seekers properly. Under the proposals the existing work permit system and special scheme for the agricultural and hospitality industry will be scrapped.

An Australian-style points system, applying to the doctor as well as the domestic worker, will be introduced for all non-EU and European Economic Area migrants. Employers caught using illegal immigrants will face an on-the-spot fine of £2,000 per person under the proposals.

The Home Secretary also announced plans to scrap the policy under which people given asylum receive indefinite leave to remain in the country. In future they will have temporary leave to stay for five years and if circumstances improve in their home country they will be expected to return.

The Government is to curb chain migration, under which people who settle bring in dependants. Migrants who settle will have to wait five years before they can sponsor further family members to join them. Migrants, or people sponsoring them, from high-risk countries, may have to deposit a cash sum that will be forfeited if they do not leave the country.

Mr Clarke insisted that the key to the proposal was to remove more failed asylum applicants from the country, but his strategy did not include any target figure for removals.

There will be four tiers. The highly skilled, including doctors, engineers and finance experts, can come to Britain without a job offer. They will receive points based on educational qualifications, work experience and current salary.

Tier two is for the skilled, such as nurses and teachers. They will need the equivalent of A levels but will be allowed to enter only if they have a job offer in an area where there are job shortages.

Tier three for the low-skilled will replace the current agriculture and hospitality industry scheme. Migrants will be allowed to enter only for fixed periods and will have no right to settle. Tier four is for students and Commonwealth youngsters who currently arrive for two years under the Working Holidaymaker scheme.

Migrants seeking to come under tiers three and four will do so only if the Government has a deal with their country in which they will accept back those who overstay.

Maeve Sherlock, the chief executive of the Refugee Council, said that successful asylum-seekers would be left in limbo. “We would be very concerned if someone who has been accepted as a refugee has to live through five years of uncertainty until the UK Government confirms they can remain here permanently,” she said.

Sir Digby Jones, Director-General of the CBI, said: “Without the option of being able to recruit from abroad, sectors like construction, IT and hospitality would have severe problems. If we are to have the workforce to pay the pensions of future generations, to satisfy today’s skills shortages and to staff our public services, the UK needs skilled migrants who speak English and participate in the economy.

DEBATE
Is immigration really such a bad thing?
debate@thetimes.co.uk

Explore UK News

• Crime News

• Education News

• Health News

• Science News

• Scotland News

Times Recommends

• Catalogue of failings ‘leaves others at risk’
• Tourists told to stay away amid Venice floods
• Google generation has no need for rote learning