- The UK government’s immigration control efforts may cost up to £4.4 billion ($5.7 billion).
- An internal Home Office analysis raises concerns about the economic impact of reducing foreign workers and international students.
- Prime Minister Keir Starmer’s commitment to manage migration without economic harm is questioned.
The UK government’s effort to curb immigration could cost the nation up to £4.4 billion ($5.7 billion), according to an internal Home Office analysis, casting doubt on Prime Minister Keir Starmer’s pledge to control migration without harming the economy.
The assessment, released alongside Starmer’s wide-ranging immigration reforms, highlights the potential economic risks of significantly reducing the number of foreign workers and international students allowed to stay in the UK.
Key Proposed Changes
Among the most notable measures are plans to reduce the period international graduates can remain in the UK after finishing their studies from two years to 18 months and to impose stricter English-language requirements for skilled-worker visas.
Additionally, companies sponsoring foreign employees would face a 33% hike in the immigration skills charge, a fee levied on employers hiring from overseas.
While Starmer has positioned the reforms as a move to make the immigration system fairer, the Home Office’s projections suggest the policy could have unintended economic consequences. The department predicts the UK could lose £1.2 billion over five years, with worst-case losses reaching £4.4 billion. Even under the most optimistic scenario, the net gain would be modest at roughly £800 million.
Much of the anticipated loss is linked to lower tuition revenue from international students, fewer income-tax contributions from graduates who leave, and reduced visa-fee collections.
Reactions from Universities
University leaders have voiced concern that the reforms could damage communities that rely heavily on international students.
“This analysis illustrates the tangible impact on growth and prosperity,” said Jamie Arrowsmith, director of Universities UK International. “Any gains from higher tuition fees will likely be offset by other policy changes.”
Former education secretary Alan Johnson warned that the policy could threaten university operations if international enrollments drop. “Targeting students who contribute billions to the economy would be a serious mistake,” he said.
Migration advocates have also criticized the political focus on lowering migration numbers without weighing the wider economic trade-offs. Sunder Katwala, head of the British Future think tank, argued that while migration can put pressure on housing and services, it also supports the economy through taxes, tuition, and spending.
Current Trends
Net migration has already started to fall, reaching around 431,000 in 2024, down from a record 860,000 in 2023, following post-pandemic surges and a rise in foreign student enrollments. Officials attribute the 2023 spike partly to the growth in study visas for lower-ranked universities, which rose 49% between 2021 and 2023.
The government maintains that the new rules will “restore confidence” in the immigration system and prevent the “incalculable damage” caused by years of uncontrolled migration, as Starmer put it. However, critics including some Labour Party members warn the reforms could threaten one of the UK’s most profitable sectors: higher education.
Leave a Reply