Vince: Migration stats show Brexodus of skilled workers we need to stay in the UK

So, net migration figures today will leave Brexiteers smug about getting rid of foreigners but what does a huge fall in the number of EU citizens coming here and a huge rise in those leaving mean for our economy. Vince Cable says it’s not good as businesses struggle to get the skilled workers that they need. With UK unemployment as low as it is, we aren’t going to be able to meet that need ourselves.

These figures show a deeply worrying Brexodus of EU citizens who have made the UK their home. This is largely a result of the failure of Theresa May’s government to guarantee EU citizens’ right to stay.

Recent research shows that more than half of British businesses are struggling to recruit the skilled labour they need.  We have already seen record numbers of EU workers leaving our NHS, and today we hear stark warnings from the food and drink industry that they face significant disruption and economic damage if European nationals continue to leave.

This government must act urgently to give assurances to skilled and hard-working EU citizens, before any more damage is done to our already weakened economy.

The common sense solution is for the British Government to unilaterally make clear EU citizens resident here are welcome to stay. This will open the way to reciprocal offers from EU governments to offer the same assurances to British citizens living and working across Europe.

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  • Richard Underhill 24th Aug '17 - 10:36pm

    She knows exactly what she is doing. At a fringe meeting at a federal conference in Brighton, Cabinet Minister Vince Cable spoke first. The City of London spokesman said that the only way to meet the Tory immigration target of tens of thousands was to have a recession.

  • Vince’s comments are disappointing but not surprising. There was an increase of only 24,000 non-UK EU citizens leaving in the year ending March 2017 than the previous year. It is a good thing that fewer people are coming from the EU without having a job to start. I wonder what is wrong with 101,000 more people leaving the UK with a job to start in a foreign country?

    British business seems to want to recruit trained people rather than recruit people to train and this might well be why they decry a lack of trained people.

    I don’t consider having 4.6% of the working age population unemployed and looking for work a great achievement (that is 1.54 million people). There are also about another million people who with the right support (with their health issues or disability) might well be able to work.

  • Vince is correct about the economic impact.
    The lump of labour fallacy is the contention that the amount of work available in an economy is fixed.  But, most economists dismiss this belief as a fallacy.
    immigrants who gain work, also gain income to spend in the rest of the economy, creating new jobs. The number of jobs is not fixed. Immigration increases labour supply, but also increases demand for labour. Generally, immigration has no impact on the average unemployment rate. These new workers also add to aggregate demand. If they get a job, they will spend their wages on goods and services, which creates additional demand and therefore additional jobs in the economy. Immigrants tend to create as many new jobs as they fill. If the population expands, the number of available jobs does not stay constant, but increases.
    In the 1950s and 60s, the UK experienced high levels of immigration, but this did not lead to unemployment. The economy stayed close to full employment as the new workers helped to increase the economic output.
    Immigration itself is not the cause of unemployment. Unemployment is largely due to cyclical or structural factors like lack of relevant skills, that needs to be addressed with direct investment in skills training.
    It is the type of migration that is key- net migrants of working age tend to be net contributors to the government budget. This net migration improves tax revenues, which in theory could be used to improve skills of the unemployed. The top three countries sending migrants to the UK are India, Poland and Pakistan. EU migrants tend to be among the higher skilled and are collectively net contributors to the public purse.

  • Joe.
    Mass Immigration in the 50s and 60s was short sighted because a lot of the jobs people were brought over to do soon disappeared resulting in higher than average levels of unemployment in those communities. The legacy in Leicester is de-unionised sweatshops. It’s very shorted sighted to rely a cheap flow of labour when automation, imports and new technologies will remove many of those jobs.

  • Richard Underhill 25th Aug '17 - 10:50am

    It is simply wrong to regard these people as foreigners, as Charles Kennedy said.
    The EU is about partnership. UK citizens would lose our status as EU citizens after Brexit, which causes some of us to grieve at the illogicality of damaging a worthwhile organisation.
    NATO is also about partnership, but the current UK government remains committed to co-operating with our partners. That does not mean that the UK should support Donald Trump’s latest opinion on North Korea or Afghanistan. The precedent is that British PM Harold Wilson (Labour) did not support the USA in Vietnam, although Wilson had been a minister in the Atlee government which had supported the USA, with troops, in the Korean war.

  • Yeovil Yokel 25th Aug '17 - 11:15am

    Glenn – as a former Lestrian I don’t recall mass migration into the city during the 1950’s & 1960’s. The main influx followed the mass expulsion of Asians by Idi Amin from Uganda in 1972, and to a lesser extent a number of Greek families arrived as refugees after Turkey invaded Cyprus in 1974. What is the connection between these communities and ‘de-unionised sweatshops’ in Leicester, or did you simply experience a moment of historical confusion?

  • Glenn is completely correct in his assertions regarding training at work. Companies want people read the trained up yet there is not the intuitive service from the state to provide this. I find it scandalous that a liberal democratic party that constantly takes the moral high horse on migration fails to campaign for aspiring jobseekers and others in work who want to fulfil their potential in transmogrifying jsa and jcp to lift people out of zero hours poverty.

    I’ve go every past waiting as you have an old fashioned view of economics that regards 4.8% as an acceptable unemployment rate.

    My advice to the lib dems is go back to the drawing board and actually listen to people at the bottom and find solutions. If this means intervening in your own prejudices them change!

  • Yeovil.
    Mass immigration into Leicester, as with other parts of the midlands and into South Yorkshire actually starts soon after the partition of India and was largely driven by the demands of the hosiery industry. Sweatshop scandals crop up every few years and have been the subject of many newspaper articles. I have relatives who arrived in Britain as a result of the Amin expulsions and one of the reasons Leicester was a an obvious choice is because of already established communities in the region.

  • Peter Martin 25th Aug '17 - 12:41pm


    I don’t think I’ve seen this word previously. Does it mean a net exodus from the UK or just a net exodus to the EU27 countries?

    I wouldn’t have thought we’d have either. Or maybe I’ve got it wrong?

    Maybe it just means a slight fall in the numbers coming to the UK?

  • Peter Martin 25th Aug '17 - 1:32pm

    “With UK unemployment as low as it is, we aren’t going to be able to meet that need ourselves.”

    But who believes the official figures on unemployment? We really shouldn’t be so gullible as to accept those. Margaret Thatcher won an election in 1978 on the slogan “Britain isn’t working”. The unemployment rate, in % terms, at the time was about the same as it is now – according to Government figures of the time. It was far less in numerical terms because of the increase numbers of workers in the workforce. It may have been just about possible for a family to manage on a single income then. It’s much harder now and the tax system doesn’t encourage that.

    In 1978 anyone who was registered as looking for work was counted. Now they are only counted under certain condition such as being in receipt of certain benefits. If anyone is too young, or too old, or too sick or maybe they just get an hour of work each week on a ZHC they aren’t counted.

    The extent of unemployment has been hidden rather than there being any real reduction. There’s been no attempt to train unemployed and underemployed workers to do the necessary jobs we need in the economy because it’s cheaper to import workers from the EU.

    So why pay a bursary to a student nurse? It’s far cheaper to recruit a nurse from Spain who been paid for by Spanish taxpayers. Why bother to provide extra places at medical schools?

    I could go on but I’m sure you get the idea!

  • The Brexiteers in full cry and what a racket they make
    A few points, given the dive in the pound we soon won’t be able to afford the Spanish nurses, so it’s either train are own or raid the third world. I suspect they won’t like the option our brave Brexiteer government take.
    As to training staff what a good idea but as we have decided to leave our major market it makes much more sense to move the factories to the labour than move the labour to the factories, which is essentially what they have been doing

  • Bill Fowler 25th Aug '17 - 2:21pm

    Had the weird situation of british teenagers begging in the street whilst foreign EU teenagers were working in the nearby Poundland (the latter mostly gone and replaced by auto-tellers, BTW) which i could not get my head around a year or two ago…

    But these figures are not showing a net migration out of the UK, only that less people are coming in than a year ago which given the housing and public services overload can only be a good thing. The completely wrecked state of the pound also makes the UK unattractive for foreigners who want to send their money back home.

    With huge increases in dependent people (kids, elderly etc) down the line not sure how we can get out of the mess we are in. In the past I would have helped out by renting out my house and living abroad on the proceeds but Osborne changed the rules so that I would have to pay capital gains if I came back and sold the house so I just leave it empty for a couple of months whilst abroad.

  • Steve Trevethan 25th Aug '17 - 2:50pm

    Perhaps we might consider a wider and longer term view on population,
    and migration and their interactive effects, actual and imagined, on economics/finance, politics and societies etc?

    In 08/2012 the US Military issued a planning document entitled “Operational Environments to 2028: The Strategic Environment for Unified Land Operations [TRADOC G-2]. Here is a relevant extract (pp 69-70).

    “Later in the forecast period (2025-2030) there is a possibility that population declines and continuing financial weakness will seriously erode social and economic conditions in some European states leading to widespread collapse in civil order, failure of national governments, or humanitarian crises due to natural disasters that weakened states are unable to contend with.

    Perhaps we also need to consider our future and the futures of our neighbours and, hopefully, friends in Europe in relation to the “Western Alliance” and an increasingly multi-polar world?

    PS Page 68 has interesting details on Russian military and economic weaknesses!

  • The post-war welfare state (NHS, State Pensions, Secondary education to 18, Social security, public housing etc.,) is dependent on a thriving economy and full-employment. Immigration serves to support both of these objectives.
    The wealthiest countries in the world are also the top destinations for immigrants. The largest national economy, the USA, has the most immigrants at over 45 million. The largest country in the world, Russia, has 11 million, mostly from former soviet republics. Germany, the strongest economy in Europe, has 10 million. Oil rich Saudi Arabia and UAE have 9 and 8 million respectively. The UK, France and Canada around 7.5 million and Australia and Spain circa 6.5 million.
    Wealthy countries attract migrants and migrants increase the wealth of the countries they attract.
    Migrants are not the reason that home populations experience unemployment, under-employment or stagnating wages. These ills are attributable to under-investment in infrastructure and skills training, dysfunctional economic and monetary systems and the impact of globalisation.
    The electric cars of the near future (whether designed in America, Japan or Germany) will be built in heavily automated Chinese factories. When poorer migrants start flocking to China (instead of the West) to pick the crops, drive the taxis, build the roads and houses, care for the elderly and run the bars and restaurants for an increasingly middle class Chinese society, will the UK be a thriving place to be. What do you think?

  • Joe,
    Wealthy countries attract people because they are wealthy, it’s not what makes them wealthy. What are the living standard like for say migrants in the French Suburbs or for say a migrant worker in Saudi Arabia or for say Mexican in Los Angeles. What kind of jobs are they doing, coz they are not all doctors or highly skilled. How is job security? What are the social tension? Has immigration improved welfare, lowered the retirement age, lead to cheaper housing, boosted manufacturing and so on for the older populations? Does the real life really fit the model. I think there is a difference between wealth and GDP.

  • P.S
    Migrants will not flock to China because China already has a huge population and in truth probably would not accept large numbers anyway. After all Japan doesn’t and that is a pretty big economy.

  • The net migration figures show a (small) net increase in the number of people from the EU. There is no Brexodus.

    It does look like we will have to get on with a stable number of people from the EU in the country rather than a constantly increasing number though. If that tips the UK into recession then there is a serious problem with how society is set up – though as the EU8 countries catch up economically that situation would have been reached in the end.

    Vince Cable’s vision of super-high tuition fees for UK students and filling the necessary positions by freeloading off EU8 countries with free university tuition was never workable long-term.

  • Richard,

    The number of immigrants from the EU fell off a cliff after the vote. The figures you quote cover the year to March, before Brexit immigration was running at a high rate afterwards it plummeted.

  • Little Jackie Paper 25th Aug '17 - 11:18pm

    What is the purpose of high levels of migration, EU or otherwise? Is the purpose economic? In which case I would argue that we can have high migration without that implying the open-ended right of establishment the EU works on. Would economic migration mean everyone who comes is subject to a minimum wage test, or that we only import people into specific shortage jobs. If the purpose is economic then it stands to reason that we gauge everything by economic impact. Indeed, should we sell visas?

    Is the purpose political? Is migration a tool of politics, in the classic sense of power relations? It is arguable that migration is rightly a tool of power relations – albeit the voters probably have never really been expressly consulted on the point. Soft power e.g. from students does matter.

    At the moment we seem to have the worst of all worlds. We are told that we need high levels of migration to support the economy, despite un/underemployment. Lump of labour is only fallacious in conditions of full economic capacity. The unmanaged nature of EU migration has resulted on pressure on services and wage arbitrage. Similarly we are told that migration is a political virtue, with only a few seeing the political benefits.

    The fundamental problem here is not the people, or even the principle of migration. Rather it is the glaring lack of reciprocity. If 3+m young un/underemployed UK people could all realistically head to Latvia/Slovakia/Bulgaria for wages, housing and welfare then we’d have had a 95% REMAIN vote. We have the veneer of an economic case and the veneer of a political case with not enough people feeling the benefits and becoming ever less convinced by the open agenda underpinning this debate.

    There’s no point telling people that leaving the EU will crash the economy when the economy the experience crashed a decade before the referendum. There’s no point telling people that the EU is all A-OK when industry is saying that they love the cheap imported labour. I’m sure Vince Cable knows this – he’s a clever man. But like Cameron before him he’s failing to say what to do about it.

    This isn’t a numbers game – or it shouldn’t be. But if I’m unconvinced by the ‘tens of thousands’ game I can’t say I’m any the more impressed by the ongoing refusal of those who are positive about high levels of migration to grapple with problems which are rather more than theoretical.

    I’ll let everyone spit vitriol at me now.

  • Little Jackie Paper 25th Aug '17 - 11:20pm

    Bill Fowler – ‘In the past I would have helped out by renting out my house and living abroad on the proceeds’

    Out of interest did you manage to keep a straight face as you typed that?

  • Little Jackie Paper 25th Aug '17 - 11:26pm

    Joe Bourke – ‘It is the type of migration that is key- net migrants of working age tend to be net contributors to the government budget.’

    I don’t understand that. We have no guarantee of the type of migration into the future. The benefits of young people may well be non-recurrent i.e as they get older they need more in terms of spend. Inevitably one has to look at opportunity cost.

    But what about people like my wife for example? Are you saying that she would only be welcome in the event that she was a net contributor in perpetuity? Presumably not.

    The point here is not migration in itself, or even numbers. It is reciprocity and the issues associated with sizable unmanaged influxes. I can’t stress that enough – this isn’t a numbers game.

  • Little Jackie Paper,

    this is how the US green card system works. Employers need to be able to show that they have tried and have been unable to recruit sufficient workers with the required skills from the resident labour force to engage overseas workers. Spousal Visas are a human right and few countries would block such applications. Other family applications are generally subject to country by country quotas in the US and can take several years in some cases.

    Reciprocity is of course an important element as is cultural/ethnic origin in practice. Settlement and integration seems to be far easier for migrants from English speaking counties and Western Europe, as it is for Brits emigrating to those areas of the world.

  • @ Joe Bourke

    You are wrong to think that Vince is correct about the economic impact as I stated, only 24,000 more non-UK EU citizens left in the year being discussed than the previous year. This is about 0.07% of the working age population of the UK and 1.6% of the number of people unemployed in the UK. The increase in all non-UK citizens leaving is only 17,000 (Didn’t you actually read the figures in the link?)

    Why would anyone believe a word of Vince’s analysis if he can make such wild statements about such a small increase in the number of foreign-born people leaving the UK?

    @ James

    I am sure I am not the only Liberal Democrat who thinks an official unemployment figure of 4.6% is too high and would like to return of about 3% as after the Second World War and in the early 1970’s.

    @ Peter Martin

    Some excellent points about official unemployment figures (not forgetting the over 2 million who have health or disability issues and are not in work) and under employment (VHC).

    @ Frankie

    The number of EU citizens coming to the UK did not fall off a cliff, in the year under discussion they are down by only 18,000 because 33,000 of the reduction in the net figure is due to 33,000 more EU citizens leaving.

  • @ Joe Bourke

    If we had a closed economy and everyone in it was working, then if someone wanted to recruit a new worker they would have to offer better terms and conditions (most likely more pay) to entice a worker from their current employer. In this economy there are market forces to increase wages because labour is limited. If instead a person outside that economy is employed then the employer does not have to offer better terms and conditions (more pay) to attract that worker, they only have to be better than those the person could get outside that economy. Therefore if employers can recruit outside the country the economic forces to increase wages is reduced. Therefore immigration does have an economic effect in holding down wages and abolishes the pressure to increase wages in a closed fully employed economy.

    Lots of immigrants send part of their wages back to their home country to support family members still living there. Therefore if this is happening the amount being spent in the host nation is less than would have been spent if instead of employing the immigrant the employer had employed someone who was already resident in the country who was unemployed. In fact the economic benefit might still be more to the “host” country if the person employed who was already resident there was in a lower paid job.

  • @Frankie. The chart you posted shows positive net migration (i.e. more people arriving than leaving, the total number of people in the country from the EU increasing), just not quite as fast as before (and much slower in the case of EU8 countries though still increasing).

    The question is, is there a plan for when those figures drop to zero or even below and you have a net outflow? Because with or without Brexit it will happen one day as the countries that invest in free university education catch up with the UK economically (or close the gap enough to make it no longer worth leaving family, friends and better weather).

  • Bill Fowler 26th Aug '17 - 8:09am

    Bill Fowler – ‘In the past I would have helped out by renting out my house and living abroad on the proceeds’

    Out of interest did you manage to keep a straight face as you typed that?”

    Seriously, my house could house a family of four to six rather than just myself (increasing the council tax take as well) and I work online from anywhere so it would help but for the new capital gains tax implications, and probably lots more people have been put off doing the same. Don’t want to sell the house as price rises means I might not be able to buy back in after five, ten, years. I could rent out a room but can’t be bothered with the hassle.

  • David Evershed 26th Aug '17 - 11:59am

    The Office of National Statistics shows net immigration from EU countries to the UK in the year ending March 2017 was 127,000. About the same as the population of Gloucester.

    The previous year it was 178,000.


  • Michael BG,

    “You are wrong to think that Vince is correct about the economic impact as I stated.”
    This is a matter of opinion based on your own reasoning, that I believe is based on assumptions that do not hold in the real world or are far more nuanced then you allow for.
    Conversely, I think Vince Cable has correctly analysed the position and has taken the appropriate action in calling for “the British Government to unilaterally make clear EU citizens resident here are welcome to stay.”

    Objective analysis of the impact of migration by credible economists working in the field finds as follows:

    – UK research suggests that immigration has a small impact on average wages of existing workers, but more significant effects for certain groups: low-wage workers lose while medium and high-paid workers gain.
    – The wage effects of immigration are likely to be greatest for resident workers who are immigrants themselves.
    – Research does not find a significant impact of overall immigration on unemployment in the UK, but the evidence suggests that immigration from outside the EU could have a negative impact on the employment of UK-born workers, especially during an economic downturn.
    – The impacts of immigration on the labour market depend on the skills of migrants, the skills of existing workers, and the characteristics of the host economy. This means that research evidence on the labour market effects of immigration is always specific to time and place.
    – For both wages and employment, short run effects of immigration differ from long run effects: any declines in the wages and employment of UK-born workers in the short run can be offset by rising wages and employment in the long run.

  • Glenn,

    Japan has a serious demographic problem with its ageing population and declining birthrate (so too does Hong Kong)

    Japan only opened it economy to external trade in the 19th Century when Commodore Perry sailed into Tokyo Bay with his black ships and trained his cannon on the Shogun’s palace.

    It continues to have a deep-seated prejudice against immigration.There are significant Korean and Chinese minorities in Japan and regional Ainu cultures such as those of the Ryukyu Islands and Hokkaido, as well as well as the Japanese diaspora in North and South America. Perhaps these cultures may come to the rescue when there are too few homegrown Japanese of working age to maintain the elderly population.

  • joe.
    I don’t see it happening. I think you discount culture and history too much because you focus on economic arguments. People are instinctively tribal, history is shaped by it, Hence multiculturalism and identity politics are a way of trying to square the contradictions caused by the tendency of people to form homogenised groups. A lot of people put this down to race, but really it’s about reinforced webs of culture in both the host and migrant communities. This is why economic arguments don’t actually work that well. I think late capitalism like Marxism has developed a tendency to try to make better people out of the stubbornly awkward reality. Hence the system goes into shock when people don’t behave in the correct way according to economic and social models. In the idealised capitalist vision people are supposed to have moved past the baggage of their cultures, but just as with the muscular collectivised stoic worker of Soviet mythology the lumpy reality just does not fit. People cling to their communities, nation-states, religions and so on. I think things just trundle along the tracks and everything is about managing the trundle without upsetting the passengers too much or going off the rails.

  • Micheal,

    Look at the graph and tell tell me migration didn’t fall of a cliff. If Brexit hadn’t started the number of migrants from the EU would have been much greater. The economy was booming, the pound was worth 1.3119 EUR and it paid to move. Now the pound is heading towards parity and the economy is stuttering, the pull is much decreased.

  • Glenn,

    you are probably right. I lived and worked in Japan for three years and understand the historical,cultural and political impediments very well. There were 1 million Gaigin’s (foreigners) in Japan then (early 1990’s) and around 2.3 million now, so some progress but still relatively small as a % of population.

    The reason economic arguments matter can be clearly seen in Japan’s stagnant economy that has not responded to repeated rounds of fiscal and monetary stimulus

    “Japan’s welfare state interacts with demographic changes. It’s not that the welfare state is enormous, particularly compared with European nations, but the system is becoming an ever-increasing burden because the Japanese people are living longer and having fewer children.” No amount of keynesian stimulus can address these structural issues Japan will need policies to increase the participation of women in the workforce, accelerate the deployment of robots in its manufacturing industries ad yes, ease its restrictions on integration.

    The Samurai culture was swept away in the Meiji restoration. The reticense towards liberalisation of immigration policy will probably have to go the same way.

  • @ Joe Bouke

    Do you really think that 17,000 more foreign born people leaving the UK this year than last year is a problem when 246,000 more people arrived in the UK than left it in the same period?

    To summarise your quotations:

    Immigration impacts low-paid workers;
    Immigration effects on wages is greater on those immigrants already here than native born workers;
    “immigration from outside the EU could have a negative impact on the employment of UK-born workers, especially during an economic downturn”;
    The short term effects of immigration are declining wages and employment of UK-born workers.

    @ Joe Bourke
    “when there are too few homegrown Japanese of working age to maintain the elderly population.”

    Or the Japanese economy will improve its productivity with the use of robots and AI such that it’s declining working age population can support its growing retired population.

    If you look at Japan’s unemployment rate it is something to envy – in September 2015 it was just over 3% and just after April 2009 it peaked at 5.5% (….0…1.1.64.psy-ab..0.12.1358.6nV3Jy7d9TM#imgrc=7IepeGMuQuhlOM:) while in the UK ours peaked at 8.5% just before 2012 and is now about 4.6% (….0…1.1.64.psy-ab..0.5.512…0i30k1.7NAwamUU140#imgrc=71JWyoyP6z7fKM:).

    @ frankie

    Do you not accept the figure that only 18,000 fewer EU citizens arrived in the UK than the previous year? The graph you linked to is about net figures (which Richard S pointed out) which as I explained is because 33,000 more EU citizens left the UK than in the previous year. It still only shows a net reduction of 51,000, it doesn’t show the number who migrated here.

  • If we are going to leave the eu, then we must be vigorous with our immigration so that we only get those who are an asset to our country and encourage those who are not to leave.

  • Peter Hirst 28th Aug ’17 – 12:08pm……………If we are going to leave the eu, then we must be vigorous with our immigration so that we only get those who are an asset to our country and encourage those who are not to leave…

    Define ‘asset’…

    Using a ‘salary yardstick’ means that nurses, care workers, etc. will be, to use your words, “encouraged to leave”…

  • Look, behind the argument about stats we have the following situation:
    There are 120 000 more from the EU than 12 months ago. Are there 120 000 more jobs that British people are unwilling / unqualified / too lazy to do than there were in March 2016? Is Vince Cable correct that the economy needs a continuous increase of people and will collapse if it the numbers of people is stable or only increases slowly? If so then it seems to have a lot in common with a Ponzi scheme.

    Re: nurses. I would be fine about applying the same rules as apply to any other profession. The employer should have to try paying at least the average national wage first (26K is the limit I believe) before they’re allowed to look abroad. We might be surprised how many British nurses would return to the profession or enter training if we started paying the UK market rate (i.e. where supply and demand are balanced in the UK) rather than the world market rate. Yes it would be expensive but if the govt has enough money for vanity projects like HS2 or the bloated military then they should have money to do this too.

    i disagree with Peter though about how to treat people who are already in the UK.

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