New migrant ‘health surcharge’ – an election stunt full of loopholes

The government announced yesterday that migrants will be subject to a new ‘health surcharge’. The fee comes into effect next month. The surcharge is £200 per year payable upfront with students required to pay £150 annually.

The health surcharge is an election stunt full of loopholes. The policy begins on 6 April – a week after Parliament is expected to dissolve and during a national election campaign. The timing of it is hardly coincidental.

But the bigger problem is this: government rhetoric fails to meet reality. The public are told the surcharge will offset the costs to the NHS from treating migrants. However, thousands of migrants will not need to pay because of several exemptions and restrictions. It’s a clear case of government saying one thing, but doing another.

The health surcharge will only be imposed on non-EEA citizens in the UK temporarily for more than 6 months. EEA citizens from Europe are unaffected. There are 11 different exemptions from the surcharge include anyone visiting the UK for under six months, intra-company transfers, children under 18 years in care, and nationals of Australia and New Zealand.

There are further concerns that the funding raised may not be used effectively. Migrants paying the surcharge must do so upfront and the money collected is distributed to the relevant health department in England, Wales, Scotland or Northern Ireland. The problem is that migrants don’t always stay in the same place. If a migrant moves from England to Wales, the funding raised by the surcharge does not appear to follow the individual. This will mean the new funds might not go to the authorities that need it most.

It is true that migration has put pressure on public services, such as the NHS. But it is also true that the government lacks concrete figures about the actual costs that migration adds to the NHS bill. If health tourism is about migrants dropping in for free procedures and then leaving the country, this is not tackled by the new health surcharge as it does not affect anyone coming to the UK for less than 6 months even if a visa is required for entry.

A better alternative would be to bring back the Migration Impacts Fund launched by Prime Minister Gordon Brown in 2009. Like the new health surcharge, the Migration Impacts Fund was a levy on application fees paid for by non-EEA citizens. Over two years, it helped raise £70m to provide English language training, extra support teachers and improve emergency services. Local authorities would submit bids and the funding would go to those areas where support was needed most. It wasn’t ideal, but a step in the right direction.

The government ended the programme shortly after entering 10 Downing Street. Baroness Hanham CBE said that ‘In light of the overall fiscal position the government concluded it was not a priority funding stream’. And so it was stopped. But while the Fund was terminated, the levy remained with the extra funding going to other programmes.

The upshot is that the pressures on public service have not gone down while government support for relieving such pressures – through instruments like the Migration Impacts Fund – were cut. If our health service requires urgent support because of migration, then the government shares some of the blame for too quickly scrapping a useful programme.

Moreover, migration-related pressures on public services are not confined to health services alone, but also education, transport and other areas. The Migration Impacts Fund was a programme that addressed all of these areas. The government’s new health surcharge speaks to only one and leaves the others exposed.

The government should have considered a new Migration Impacts Reduction Fund, as I have called for recently. A small levy of £25 on immigration fees could raise an extra £11.7m of new funding to help provide necessary services without increasing costs for hardworking taxpayers while improving public services for all. Instead, the government’s health surcharge might not support the NHS in the way it has been announced – and it will do little to improve public confidence in either the seriousness that government officials take migration issues or in championing the many genuine contributions that migrants bring to the UK. And I should know first-hand: I am a migrant to the UK (and British citizen since 2011) who has paid into the Migration Impacts Fund. So I do not advocate a programme I haven’t contributed to myself.

The government should stop seeing immigration as a political football and instead as a serious policy area that deserves far more serious policymaking.

Thom Brooks is Professor of Law and Government at Durham University