‘The Government’s earned settlement policy is built on a fiction. It should be scrapped’

Reports suggest Downing Street is considering transitional protections for migrants already in the UK. If true, that is welcome. But protecting those already here does not fix this policy. It would put a sticking plaster on a scheme flawed from the beginning.

The entire case for earned settlement rests on a single headline figure: a claimed £10 billion fiscal cost from care workers and their dependants settling in the UK.   The Home Secretary warned that, without reform, we face a £10 billion drain on our public finances.

But the Government’s own Migration Advisory Committee data shows that delaying settlement will not deliver £10 billion in savings. That figure is an estimate of lifetime costs that accumulate overwhelmingly in retirement, through state pensions and healthcare, decades from now. Delaying settlement extends the period workers cannot claim benefits, but working-age welfare is a small fraction of lifetime fiscal impact. The policy does not touch the big-ticket items. So in short, these distant costs will arise anyway, just a little bit later than at present.

READ MORE: ‘Labour’s two-child cap victory rings hollow while asylum-seeking children remain in poverty’

In truth, the policy is likely to cost the Treasury money, not save it. The MAC’s own modelling shows care workers and their dependants are net contributors for roughly their first 20 years in the UK. If these reforms push people to leave, the Treasury loses that revenue now. Strip away the fiscal fiction, and what remains actively damages the things this Government cares about.

Start with child poverty. The Home Affairs Select Committee has found these changes will very likely increase child poverty. IPPR calculates 309,000 children will be affected. Barnardo’s told the Committee it is seeing children in No Recourse to Public Funds households experiencing malnutrition and stunted growth. Keeping low-paid migrant parents — who pay the same taxes as their British colleagues — on insecure visas for 15 years without Universal Credit directly undermines the Government’s child poverty strategy. The costs do not vanish; they are displaced onto local authorities already spending tens of millions supporting destitute families.

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Then the economy. Care England warned the Committee these proposals could create care deserts, yet there is no evidence the Home Office has coordinated with the Department of Health. Meanwhile, construction alone needs a quarter of a million extra workers by 2028, with manufacturing and clean energy facing shortfalls of their own. Many skilled workers earn below the £50,270 threshold for a five-year settlement route.

We are telling the workers we need most that Britain is not a serious place to build a career. Meanwhile, in Canada, Australia and the major EU states, permanent residence comes within five years.

Community cohesion suffers too. Evidence from existing long routes shows prolonged insecurity makes people feel they do not belong and increases the risk of undocumented status. A two-tier system — 15 years for a care worker, five for a professional, three for a banker —fractures workplace solidarity and weakens the services that hold communities together.

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This policy fails on its own terms. Its fiscal rationale is misleading. It will cost more than it saves. It will deepen child poverty, hollow out essential services, undermine our industrial ambitions and economy, and corrode community cohesion.

Earned settlement is not about cutting immigration. It is about who belongs; and our answer to that question tells a story about who we are as a Labour Party. But right now, it is the wrong story — one that engenders fear, hardship and a devaluing of the vital contributions migrants make to this country every day. The story we need to tell is of real contribution, belonging and solidarity, and our proud achievements in government.

Quite apart from anything else, this policy is not just electorally unnecessary – it will be electorally harmful. The Government should abandon it.

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