Earned settlement: retrospective change is wrong but prospective change is even worse

Changing the rules for migrants already here is wrong and unfair but only affects a finite group of people. Extending default settlement to 10 years or more for everyone is a social policy disaster.

Photo by Prakasam Mathaiyan on Unsplash

Applying the new earned settlement rules retrospectively to migrants already here is wrong. People came to the United Kingdom under a specific set of rules and made life-altering decisions on that basis. Moving the goalposts midway through their journey is a breach of faith, and the government should not do it.

But the bigger problem is the proposal to extend the default settlement period to 10 years for all future migrants. This is, in terms of its long-term damage to the United Kingdom, an order of magnitude more serious but it has received far less attention from MPs and the media than it deserves.

The harm to integration, to the social fabric, to children’s futures and to workers’ rights will be immense. If the government does press ahead, tied visas should last for a maximum of five years. If additional time beyond that is needed to achieve settlement, workers should at least be free to change jobs and employers to mitigate the harm this policy will cause.

On the retrospective change: wrong, but bounded

Around 1.35 million people already on routes to settlement could be affected by a longer default qualifying period if the changes are applied retrospectively as the government intends. Children account for nearly a quarter of this group — around 309,000 in total, with most of them dependants on their parents’ work visas, according to IPPR’s analysis. They will quite literally be unsettled for longer than they need to be, with all the social and economic impacts that will bring. That is a serious injustice.

In her speech at IPPR on 5 March 2026, Home Secretary Shabana Mahmood claimed that without applying the new rules to migrants already here, the UK faces a “£10 billion pound drain” on public finances from the settlement of lower-skilled workers and their dependants who arrived between 2022 and 2024.

That figure does not survive scrutiny.

The £10 billion is an estimate of lifetime costs that accumulate overwhelmingly in retirement, through state pensions and healthcare, decades from now. Delaying settlement extends the period in which workers cannot claim working-age benefits, but working-age welfare is a small fraction of that lifetime fiscal impact. Unless the plan is to drive people to leave the UK, which the government denies and which is inherently unlikely, delaying settlement by five years saves nothing close to £10 billion — it merely defers a fraction of costs that will arrive regardless. Economist Jonathan Portes told the Home Affairs Select Committee that the costs of extending the settlement route would substantially outweigh any fiscal benefits from reduced access to benefits and increased visa fees. Meanwhile, the government’s own Migration Advisory Committee found that the Skilled Worker cohort arriving in 2022-23 is, as a whole, projected to make a net lifetime fiscal contribution of around £47 billion.

The retrospective application is unfair, incoherent on its own terms and should be dropped.

But the retrospective cohort, however large it is, has a boundary around it. It is a defined group of people. Their situation, however unjust, will eventually resolve one way or another.

The prospective change — doubling the default settlement period for the majority of future migrants and tripling or more in some cases — has no such boundary. It will apply to all who arrives under the new rules, for as long as those rules remain in force. It is a permanent restructuring of the relationship between migrant workers and the state, and it will shape integration outcomes in this country for decades.

10 to 20 years is an awfully long time to be temporary

In my earlier piece on earned settlement I argued that the UK has, over the past 75 years, been one of the most successful countries in the world at integrating migrants and their families, measured by objective indicators such as educational attainment and intermarriage. That success did not happen despite the UK’s pro-integration approach to settlement. It happened because of it. Settlement gives people and their employers a reason to invest in their future here. It signals to them that they belong. Labour’s earned settlement proposals are a signal to those migrants and to wider society that in future they will not belong.

The research on what temporary status does to integration is consistent and sobering. IPPR’s own previous study of migrants already on the existing 10-year route to settlement — which applies to certain family and private life cases — found that over half of respondents said they struggle to meet the costs of utilities and food. The 10-year route imposed a significant financial burden on families because of high visa and legal fees, made it harder to find work, created a feeling of insecurity about living in the UK and harmed their children’s future prospects. The effect and impact is the polar opposite of integration. It is more like segregation.

In an excellent piece back in February, Migration Observatory ran through several studies suggesting that longer periods without the rights that come with permanent status and citizenship hinder social and economic integration. Essentially, migrants with permanent residence have more bargaining power than those on work visas who are tied to their employers — which can lead to better pay and conditions. We will come back to this in a moment.

Employers see a time-limited permission and make cautious decisions. Landlords do the same. Lenders do the same. And each of those individual decisions compounds into a pattern of disadvantage that is hard to unpick years later.

The government itself acknowledged a “trade-off between the financial benefits of higher immigration fees for the government, and the negative effects on the integration and wellbeing of migrants,” as the House of Commons Library notes. It then proceeded anyway. That is not a policy based on evidence. It is a political calculation that the costs will fall on people without the political standing to push back.

Real life impact on children

A migrant on the Skilled Worker route pays visa fees not just for themselves but for each family member. Those fees are already substantial, always escalating and they recur every time permission to stay must be renewed. At the moment the visa and health surcharge costs alone — before legal fees, language tests, biometric enrolment costs and assuming the children are under 18 at all times — are around £36,000 for a family of four. Under the 10-year system, they will have to extend their stay every two and a half years and face total costs of over £70,000 at today’s fee levels. Under a 15-year system, the fees accumulate across the entirety of a child’s schooling and reach £85,000. And that is for the least well paid workers, remember.

IPPR has warned that prolonged uncertainty undermines integration and restricts access to higher education, student finance and stable employment for young people once they reach adulthood. The problem begins well before adulthood. A family that is spending thousands of pounds every two to three years on immigration fees simply has less money. Less money for the holidays, school trips, tutors, extracurricular activities, driving lessons, deposits — all the things that quietly shape a young person’s life chances. This is not theoretical. It is a predictable, structural consequence of keeping families in temporary status for twice as long.

When those children turn 18, if their parents have not yet reached settlement, they themselves will be on temporary status — without access to home fee rates at university and without access to student loans.

A child who grew up in the United Kingdom, attended British schools, made British friends, and considers this country their home will find, at the threshold of adulthood, that the system treats them as a temporary guest. That is a remarkable way to build community cohesion.

10 to 20 years on a tied visa

There is a further problem that has not received nearly enough attention: what a 10 to 20 year settlement period means for workers on sponsored visas. Let’s start by considering the existing reality for migrants on a five year tied visa.

Most people arriving on the Skilled Worker route are sponsored by a specific employer, for a specific role, at a specific salary. Their immigration status is not simply tied to being in the UK — it is tied to that employer. This creates a dangerous power imbalance.

In a report based on a survey of migrants on the very health and social care visa routes the government plans to target, the Work Rights Centre found this is not just hypothetical:

“Nearly two thirds (65%) of survey respondents disclosed an alleged employment rights breach in the last 12 months, including health and safety breaches, bullying, and discrimination. More than a third (39%) of these respondents did not raise a complaint with their employer or make a report to an external agency, and interviewees reported that social pressure, mistrust of authorities, and fear of employer retaliation left them disempowered to raise grievances.”

Parliament’s own Public Accounts Committee has documented what this power imbalance produces in practice. In its report on the Skilled Worker visa, the PAC found widespread evidence of workers suffering debt bondage, working excessive hours and exploitative conditions, and concluded that when the Home Office expanded the route in 2022, it identified evidence of exploitation of migrant care workers but was initially slow to respond.

Citizens Advice has set out the mechanism clearly. A worker who fears dismissal will not complain about unpaid wages, unsafe conditions, or harassment. A worker facing dismissal has 60 days to find a new sponsor or leave the country. A worker will tolerate a lot of low level and potential high level abuse rather than risk dismissal, particularly if they have their family with them.

Doubling the period of tied sponsorship does not just double the problem. It changes the character of the labour market entirely for a large class of workers. It heralds the introduction of a Dubai-style Kafala system.

Under the existing five-year system, the tied visa is a significant constraint. But at least it is time-limited. Under a 10 to 20 year system, a worker would spend a decade or more in which their entire immigration status — and by extension their family’s home, their children’s schooling, their right to remain — depends on maintaining the goodwill of a single employer. That is a structurally coercive relationship.

And let us pause for a moment to consider that these proposals come from a Labour government, supposedly born of a Labour movement that was founded to value, protect and promote workers’ rights.

If the government is going to press ahead with this ill-considered, ill-conceived plan — and they really should not do so, the whole thing is a terrible and totally pointless idea — then the least they can do is limit the tied visa to a maximum of five years. Any renewals of visa after five years but before settlement is achieved should be on untied visas which allow the migrant to move jobs and move employers.

And it’s not just 10 years

The headline figure of 10 years obscures the full picture. People on Skilled Worker visas sponsored for jobs designated as below graduate level — including large numbers of care workers — will have to wait for a default of 15 years. Refugees face 20 years on the “core protection” route. Those who have ever claimed benefits, or overstayed even briefly, face waits extending further still.

Fifteen years, twenty years — these are not probationary periods. They represent the better part of a working life. They are the years in which people form communities, raise children, buy homes, invest in their futures. To spend all of that in a state of enforced temporariness is not a minor inconvenience. As Sunder Katwala, director of British Future, has put it, leaving people in limbo for a ten or fifteen-year period of “unsettlement” will achieve nothing but damaging integration and community cohesion.

The prospective change is the real story

The retrospective application of new rules to migrants already here is the issue that has generated petitions, parliamentary debates, open letters from faith leaders and an intervention from Angela Rayner. It is the issue that feels most urgent because it is happening to real, identifiable people right now. That attention is deserved.

The government may bow to pressure and offers transitional protections for those already here while leaving the 10-year default in place for all future arrivals. If so, it will have retained the larger damage. The retrospective cohort is finite; the prospective change is permanent.

Every skilled worker who arrives in the future will do so knowing they face a decade of dependency on a single employer, years of escalating immigration fees, children who will reach adulthood without the security of settled status, and a labour market that will read their temporary permission as a reason to offer them less. That will not reduce numbers but it will change who comes. Migrants with high skills who have a choice of destination may well be deterred, as the Migration Observatory notes. And it will change how well those who do come integrate into British life — not because they are unwilling, but because the system will be actively working against it.

The UK spent 75 years building something genuinely worth having: a track record of successful integration. And now a Labour government plans to blow it all up.