A Scottish Affairs Committee (SAC) report recommended UK ministers consider “sub-national migration powers” for Scotland and a tailored post-study work scheme.
The UK Government response, published on Friday, stated it “does not intend to reintroduce a general post-study work scheme for Scotland” and stressed the immigration system is “designed for the whole of the UK” but takes Scotland’s needs into account.
The scrapping of a UK-wide visa scheme which allowed overseas graduates to work for two years in the UK after completing their studies was the source of strong disagreement between the two administrations.
The committee’s inquiry into Scotland’s demographic trends found its population is growing more slowly than rest of the UK due to a lower fertility rate, lower levels of inward migration and continuing emigration.
Demographic challenges facing Scotland include an ageing population and lower life expectancy than the rest of the UK, and both Holyrood and Westminster have powers that can help tackle the problem.
Westminster retains control over immigration policy, employment, pensions and the overall funding allocation to Scotland from the block grant while health, housing, social care and some tax powers are devolved to the Scottish Parliament.
In his response to the report, Secretary of State for Scotland David Mundell said: “There is a question for the Scottish Government about why, with these significant powers at their disposal and with the high levels of migration we have at the moment in the UK, Scotland is not attracting more migrants to Scotland over other parts of the UK if they deem the current levels of migration in Scotland to be too low.”
SAC chairman Pete Wishart said: “We are disappointed that the UK Government continues to refuse to explore innovative solutions to the demographic issues Scotland is facing.
“Last week, the All Party Group on Social Integration became the latest in a long list of people who have examined the evidence and realised the benefits of greater flexibility in immigration policy for Scotland.
“The Scottish Government, as well as education, industry and healthcare bodies, are all calling for this and the UK Government must take note and allow for an immigration policy that tackles the specific population issues we face in this country.
“Throughout the inquiry many witnesses expressed support for sub-national migration powers for Scotland and for current visa arrangements to be reviewed.”