Labour’s ILR U-turn to add 450,000 to Universal Credit queue

• Nearly one in three settled non-EU migrants claim Universal Credit, with the number rising by almost 83,000 since June 2024.
• Labour expects 1.4 million people to settle in Britain by 2030, potentially putting another 450,000 on Universal Credit.
• The projected annual taxpayer bill is £5.2 billion by 2030-31, as Conservatives pledge to end automatic benefit entitlement for immigrants granted settlement

Today [Thursday 5^th November] the Conservative Party have published new analysis demonstrating the impact of Labour's indefinite leave to remain U-turn on the benefits bill.

Labour's plans to grant settlement to 1.4 million migrants over the next five years could see nearly half a million claiming Universal Credit, landing taxpayers with an annual bill of more than £5.2 billion.

Nearly one in three non-EU migrants with Indefinite Leave to Remain claim Universal Credit, according to new Conservative Party analysis.Department for Work and Pensions figures show 220,283 people with Indefinite Leave to Remain were receiving Universal Credit in December 2025 around 32 per cent of the estimated 690,926 non-EU citizens with settled status.

The Home Office now expects 1.4 million people to settle in Britain between 2026 and 2030, even after its proposed reforms delay settlement for more than 500,000 people. If the same proportion claim Universal Credit as among settled migrants today, around 450,000 additional people could end up on the benefit.

Based on projected benefit rates, that would cost taxpayers an estimated £5.2 billion a year by 2030-31 a bill ultimately picked up by working people through their taxes.

Under the plans, hundreds of thousands of care workers and their dependants who arrived before May 2025 will also retain the existing five-year route to settlement, while immigrants who continue claiming benefits can still qualify after 20 years.

During the last Conservative government, immigration was too high and did not fall as promised. However, measures were taken to curb abuse and tighten the system, including restricting care workers from bringing dependents, limiting student dependents, and raising salary thresholds for Skilled Worker and family visas, and those changes drove substantial falls in net migration.

The next Conservative Government will go further. Indefinite Leave to Remain will no longer give access to benefits, a change that could save around £7 billion a year. The qualifying period for Indefinite Leave to Remain will be doubled from five to ten years, applicants will have to show they have not claimed benefits or used social housing and are net contributors, and anyone who entered or stayed in the UK illegally will be permanently barred from settlement and citizenship.

Under the plan, a future Conservative Government would remove settlement from those in this cohort who are not earning enough and are dependent on the state; bar all those on those with indefinite leave to remain, whenever they obtained it, from claiming benefits; and strictly cap the number of new immigrants and impose high standards such as salary requirements.

We must clamp down on the ballooning benefits bill before Britain loses control. Welfare should be a safety net for those who contribute, and not the default for those who arrive in the UK. Restoring that link is essential for fairness and the legitimacy of the immigration system itself.

Helen Whately MP, Shadow Work and Pensions Secretary, said:

Our country cannot afford the ballooning benefits bill. People who come to the UK should be contributing, not drawing benefits.

We will prioritise Brits in the welfare system and stop giving benefits to immigrants. Indefinite Leave to Remain and Limited Leave to Remain will no longer give automatic access to Universal Credit and sickness benefits. This will save billions and there's a principle at stake here too: British citizenship matters  We are not a cash machine for the world.

Chris Philp MP, Shadow Home Secretary, said:

Settlement should be earned through work, tax and contribution. It should not be a ticket to a lifetime on benefits.

Labour are preparing to wave through 1.4 million people by 2030, while Shabana Mahmood has just handed hundreds of thousands the old five-year fast track to settlement.

The Conservative Party has put forward serious plans to bring immigration numbers down for good. A hard annual cap on visas, doubling the residency requirement for Indefinite Leave to Remain from five to ten years, and changing the criteria for ILR so we can remove those who do not contribute to Britain.

ENDS

Notes to Editors:

• The Home Office forecast 1.4 million people will settle in the UK between 2026 and 2030. As set out below, as a result of Earned Settlement, over 500,000 people will now become eligible to settle later than they otherwise would have under current arrangements. This reduces the central estimate to 1.4 million' (Home Office, A Fairer Pathway to Settlement: Government response to the consultation, p. 45, 2 November 2026, link).

• From the 1.4 million forecast to settle between 2026 and 2030, an estimated 450,000 would claim Universal Credit. 32.4 per cent of people with Indefinite Leave to Remain, not EU Settlement Scheme, claim Universal Credit. Applying that rate to 1.4 million people gives an estimated 446,352 additional claimants.

• An estimated 690,926 non-EU citizens held settlement at the end of 2025, meaning nearly one in three are claiming Universal Credit.The Migration Observatory estimates that 720,500 non-EU citizens held settlement at the end of 2024. There were 153,204 grants of settlement in 2025. There were 182,778 grants of British citizenship to non-EU nationals in 2025, who leave the settled population when they naturalise. This gives an estimated 690,926 settled non-EU citizens at the end of 2025. There were 220,283 people with Indefinite Leave to Remain, not EU Settlement Scheme, on Universal Credit in December 2025. Therefore, an estimated 31.8 per cent of non-EU citizens with Indefinite Leave to Remain were on Universal Credit (Migration Observatory, How many migrants in the UK have settlement?, 10 November 2025, link; Home Office, Migrant journey: 2025 report, 21 May 2026, link; Home Office, Immigration system statistics, year ending December 2025, 26 February 2026, link; Department for Work and Pensions, Universal Credit quarterly statistics, 29 April 2013 to 14 May 2026, 18 August 2026,link).

• There were 233,217 people with Indefinite Leave to Remain, not EU Settlement Scheme, on Universal Credit in May 2026, 2.8 per cent of the caseload. 2.8% of people on Universal Credit were in the Indefinite Leave to Remain group.' The total caseload in May 2026 was 8.4 million, the highest on record (Department for Work and Pensions, Universal Credit quarterly statistics, 29 April 2013 to 14 May 2026, 18 August 2026, link).

• The number of settled non-EU migrants on Universal Credit has risen by 82,724 since June 2024, an increase of 29.9 per cent. There were 150,493 people with Indefinite Leave to Remain, not EU Settlement Scheme, on Universal Credit in June 2024 (Department for Work and Pensions, Universal Credit quarterly statistics, 29 April 2013 to 14 May 2026, 18 August 2026, link).

• The Migration Observatory estimates that 720,500 non-EU citizens held settlement at the end of 2024. The Observatory estimates the number was between 621,000 and 820,000. Its estimates do not include the approximately four million EU citizens who hold settled or pre-settled status under the EU Settlement Scheme (Migration Observatory, How many migrants in the UK have settlement?, 10 November 2025, link).

• In 2030-31, those settling between 2026 and 2030 would claim around £5.2 billion of Universal Credit. 446,352 additional claimants multiplied by an average annual payment of £11,694.69 gives a total annual bill of £5,219,948,271.

• The average Universal Credit payment per claimant was £873.56 a month in May 2026, or £10,482.78 a year. There were 6.7 million households with a Universal Credit payment in May 2026, receiving an average of £1,090 a month, and 8.4 million people on Universal Credit. Total monthly payments of around £7.3 billion divided by the 8.36 million people on the caseload gives £873.56 per claimant (Department for Work and Pensions, Universal Credit quarterly statistics, 29 April 2013 to 14 May 2026, 18 August 2026, link).

• Uprated in line with inflation, the average annual payment per claimant will be £11,694.69 in 2030-31. Universal Credit for 2027-28 will be uprated by September 2026 CPI inflation of 3.5 per cent. The OBR forecasts CPI inflation of 3.4 per cent in 2027, 2.1 per cent in 2028 and 2.1 per cent in 2029, which set the uprating for the following April. The average annual payment per claimant will therefore be £10,849.67 in 2027-28, £11,218.56 in 2028-29, £11,454.15 in 2029-30 and £11,694.69 in 2030-31 (OBR, Economic and fiscal outlook October 2026, Table A.1 and footnote 69, 28 October 2026, link).

• Indefinite leave to remain gives migrants access to public funds and social housing. It gives people the right to live in the UK permanently, unrestricted access to the labour market, and access to public funds and social housing' (Home Office, A Fairer Pathway to Settlement: Government response to the consultation, CP 1707, Introduction, 2 November 2026, link).

During the last Conservative administration, we promised to bring the numbers down. We did not deliver that promise. However, we did take introduce some measures to curb the levels of migration:

• Tackled care worker visa abuse by introducing new laws to restrict care workers from bringing family members. From 11 March 2024, social care workers arriving from overseas are no longer allowed to bring dependants on their visa (Home Office, News Story, 11 March 2024, link).

• Changed the rules for international students and dependents as of 2024. From 1 January 2024, international students were no longer able to bring dependants on all but postgraduate research courses and courses with government-funded scholarships (Hansard, 25 May 2023, HCWS 800, link; Home Office, News Story, 2 January 2023, link).

• Increased the salary threshold for Skilled Worker visas and family visas. From 4 April 2024, the baseline general salary to be sponsored for a Skilled Worker' visa increased from £26,200 to £38,700, while the going rate' minimum salary specific to each job has also gone up. From 11 April 2024, the minimum income normally required to sponsor someone for a spouse/partner visa was increased from £18,600 to £29,000 (Home Office, Official Statistics, 14 November 2024, link).