SAM Halstead, like hundreds of Kiwis, only planned to come to the UK for one year. Overseas experience, or OE' as it is more commonly known, is seen as a right of passage. Seven years later he is still here, working in Edinburgh as a public relations consultant.

A skilled graduate with several years of work experience, his profile fits well with the UK's new points system which begins today and aims to grant work permits to skills required in this country.

It is a system which has been welcomed and applauded in his Mr Halstead's country as well as Australia and Canada where it was trialed some 20 years ago.

Under the new system, the most highly skilled, such as doctors, will be able to come to the UK without a job offer and, after the five-year limit, will be most likely to be granted permanent residency.

There may also be regional variations in points and those applying to work, for example, in fish processing in the north-east of Scotland could be granted higher points because of the area's shortage.

"Immigration is seen so much more positively in New Zealand because we have a severe skills shortage and the points system works well," says Mr Halstead. "There are a lot of negative connotations about immigrants but people tend to forget that New Zealanders and Aussies are migrants too and that we are here working and paying taxes.

"I just flew into London to do an OE, followed friends up to Edinburgh on a whim and got a job within a few weeks. I've been made to feel really welcome and I plan to stay.

"People don't come to Scotland for the climate, they come for the lifestyle. I was not under any illusions as to what the weather would be like, but the lifestyle is great."

But despite Mr Halstead's decision to stay, thousands of other migrant workers leave or prefer the sunnier climes of south-east England.

Official figures suggest that just 4% of all UK immigrants choose to live in Scotland, way below the 10% that should be the nation's proportionate share.

Fresh Talent was introduced by the previous Scottish Executive in 2005 to try and reverse the problem, and address Scotland's declining population.

The initiative, which was aimed at attracting 8000 young people per year, has had 7541 participants since its inception.

Under the new system, the Scottish initiative will be subsumed into a UK-wide "post study" scheme which allows graduates to stay on and work for two years after they complete their degrees.

In Scotland, as with Fresh Talent, there is a small extra concession in that it will also apply to those people who have completed HNDs.

Demographic predictions for Scotland seem inconsistent but some say Scotland requires up to 25,000 new migrants per year to plug the gaps.

The population is expected to fall from five million to around 4.5m by 2043 - a 10% decrease. Currently, some 60% of adults are working to pay the pensions of the 21% who have retired. In 25 years, the pressure on the econ-omy is expected to be far greater.

In an interview with The Herald three years ago about the points system, Des Browne, the former immigration minister, revealed it would be weighted in favour of parts of Scotland and elsewhere in the UK with specific labour shortages, but warned that it would be impossible to "corral" new migrants and force them to stay.

He suggested instead that the onus would be on Scots to make people welcome. Not everyone agrees.

"The problem with the five-tier system is that it will govern immigration across Britain rather than offering a separate system to Scotland where the need to reverse a dwindling population demographic and for specific skills is considered greatest," says Robert Wright, professor of economics at Strathclyde University.

"They have got to go further and introduce regionality and make people sign a policy saying they will stay in a particular region for four years or face deportation. Unless they do this the points system will not work at all to benefit Scotland.

"They want to reduce the numbers in the south-east of England but we need to increase immigration.

"The introduction of a points-based system is a very positive development but could be very damaging for Scotland if they set the hurdle too high.

"In Canada you sign a contract saying you you have to stay and work in a particular province for a particular period of time. Unless they do this here, the points system will not work at all to benefit Scotland."

Currently, Britain's economic migrant system is incredibly complicated. There are 80 different routes in to either work or study.

Once the new system is rolled out all work permits will be governed by the same five-tier system and the more skills you have, and the more those skills are in demand, the more points you will gain - increasing your likelihood of entry to the UK.

European Union workers will not be affected. They and a few other European countries will still be able to come and go under the free market rules that allow British people to move to the continent.

While the points system will apply to the whole of the UK, regional variations will be considered and put to the UK government by the independent migration advisory committee.

"The committee, which is independently run, will be taking evidence from all round the country about what it is that particular area needs," says Phil Taylor, regional director of Borders and Immigration for Scotland and Northern Ireland. "They will be talking to employers and will look at how skills shortages are different in Scotland from the south-east or Wales.

"Scotland wants migrants who will stay and deliver and it will be able to focus particular needs quite clearly through the committee. However, there is also a danger of creating a back door to England and Wales through Scotland and this is something we need to avoid.

"The major attraction of the points system is that it is based on objective criteria that individuals will be able to self select. It means people will be able to go online to test themselves and their skills and be able to see whether they would be able to work here.

"The Fresh Talent equation is one of the most helpful because these people will have studied and lived here for some years and will not be surprised that it gets cold, wet and windy - so they are more likely to stay on and work."

Alongside the new points system and roll out of ID cards for foreign nationals applying to work in the UK, a greater emphasis will be placed on employers to ensure their staff have gone through the appropriate tests.

"We are bringing in new penalties for employers which means that where they have not taken due care in checking the employee, they will face fines of up to £10,000," says Mr Taylor.

"A team of compliance officers will be doing an audit of employers to ensure they are doing what they are supposed to be. These are civil penalties which will not need to go through the courts."

Politicians and business leaders have welcomed moves to simplify the system but there are still concerns that it does not go far enough to reverse Scotland's ageing demographic and dwindling population. "The ability to recruit the best talent is vital to companies, and we do believe that an efficient and objective points-based system will be an improvement on the overly complicated process of late," says David Lonsdale, assistant director of CBI Scotland.

"What employers are looking for is a system which is transparent, consistent and provides quick decisions for companies seeking to bring in skilled workers essential to business competit-iveness.

"We welcome too the fact that the government's migration advisory body is visiting Scotland in the near future and we look forward to engaging with them as they draw up their proposals over the coming months for a Scottish shortage occupation list.

"Our economy benefits from being open to the skills that migrant workers bring, but we must not fall into the trap of thinking that immigration is the sole solution to the skills problems this country faces.

"Inward migration cannot be an alternative to up-skilling our indigenous workforce or to labour market policies that help those on incapacity or unemployment benefits back to work."