Access to public funds for some visa holders could create economic and social gains

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Net gains to society of £872 million over ten years could be made by giving access to mainstream benefits and public services to people on certain types of work and family visas, according to an independent report by LSE London and CASE for the Greater London Authority (GLA).

The report provides a Social Cost Benefit Analysis detailing whether the social and economic gains of removing of the No Recourse to Public Funds (NRPF) condition for people with visas that could lead to long-term settlement in the UK -  and their families - outweighs the costs of giving them access to public funds if they find themselves in financial need.

It found that, over ten years, removing the NRPF condition just for households with children and other vulnerable individuals would result in a net gain of £872 million. Removing the condition for all those on limited leave to remain visas would result in a £428 million net gain.

Children and young people would benefit the most from the removal of the NRPF condition, with a gain of over £200 million. This is because children’s later life chances can be severely affected by even short periods of poverty and harmful conditions. Wider society and their communities would also benefit since many of the children subject to NRPF would be expected to stay in the country into adulthood.

Large gains would also come from people being able to access better quality, less crowded or more affordable housing. Unsuitable housing can have long-term effects on health and the financial burden of high housing costs can push families into poverty. 

Relief from problem debt would also generate significant gains since it has profound impacts socially and emotionally and on productivity, as well as affecting physical and mental health.

Employment and productivity would also be boosted by between £3 million and £8 million. Those eligible for Universal Credit would be able to access job training and childcare, and prevent them from falling into destitution, making it easier for them to get back into work.

Kath Scanlon, Distinguished Policy Fellow at LSE London and one of the authors of the report, said: “We looked at people who have a recognised, legal right to be in the UK. Many of these individuals would not qualify for means-tested benefits even if they did have access to them. However, for those people who do fall on difficult times and would otherwise qualify for assistance but for the NRPF condition, our analysis shows that it makes sense economically and socially to provide help from public funds.”

Lifting the NRPF condition from these households would also alleviate financial pressure on local authorities and charities which currently use their own resources to support many families with NRPF.  Local authorities currently spend over £60 million annually supporting those with the NRPF condition, while central government spends nearly £100 million.

The report estimates that approximately 362,000 households with regular migration status, including 106,000 households with children, would potentially be  affected by the NRPF condition.  The report looks at holders of Tier 1, 2 or 5 visas who come to the UK to work and their dependents; those who are in the UK because of family links; dependents or others who are linked to the primary visa holder and those estimated to come via the Hong Kong British National Overseas scheme.