CBI Director-General Carolyn Fairbairn stressed the importance of building a post-Brexit immigration system that works for Scotland at the business organisation’s annual lunch in Edinburgh on Friday.

Fairbairn said the UK Government’s post-Brexit immigration proposals “are troubling” and that Scotland is facing the “profound implications” of an ageing workforce.

“In around 20 years’ time, just one third of the Scottish population will be of working age,” said Fairbairn.

“This will have profound implications for Scotland, its tax base and public services.

“Three quarters of Scottish businesses expect to hire high-skilled workers in coming years. Yet nearly two thirds fear Scotland won’t have the people to fill them …

“And this is why the UK Government’s post-Brexit immigration proposals are troubling.

“The idea that skilled workers coming to Scotland may have to earn over £30,000.

“Well, the Scottish median salary is less than £24,000.

“Last year, I said that rather than debating the devolution of immigration our focus should be on a single system that receives a unanimous welcome from all parts of the UK.  

“The bad news is there is a unanimous view, and it’s that the UK Government immigration proposals don’t work for any part of the UK.

“But that does not mean we should give up just yet.

“In fact, we’re working closely with the Home Office on exactly this.

“We’re saying: first, we need a lower salary threshold right across the UK.

“Second, we need a route for overseas workers which recognises the importance of all skills levels to our economy.

“The proposed 12-month temporary visa idea risks harming integration and productivity.

“Third, we need to make the immigration system affordable and accessible – particularly for our SMEs.

“Get this right, and we can build a system that works.

“But get it wrong and – let’s be frank – calls for Scottish flexibility on immigration will only increase.”

On Brexit, Fairbairn said: “This is no time to be complacent or to slip into Brexit drift.

“Three years on, the landing zone for a workable deal still feels worrying small.

“And let me be crystal clear. Scottish firms, and firms across the UK, want a deal.  

“But for all the hope and promise that politicians will stand firm against no deal, whether by accident or design, it could still happen. 

“So we must continue to do everything possible to plan for it, but also everything possible to avoid it.

“Firms desperately need a timetable for these next few months. They need to have some idea of process, of timing, to enable them to plan, invest and prepare.

“What could this look like? 

“Firstly, we urge the Prime Minister and the Leader of the Opposition to put country before party, and compromise.

“The signs here remain mixed.

“If this part of the process fails, parliament must then find a way through. If not, public and business faith in its ability to resolve the gridlock will vanish.     

“And if this also fails what then? Support for a general election or second referendum would inevitably grow.

“The only certainty at that point would be the ongoing neglect of domestic policy, with serious consequences for UK competitiveness. 

“After three years firms still remain in the dark, taking decisions on investment, staff and pay while blindfolded by Brexit.

“It’s not good enough. We must move on.”