Low-paid migrant workers are an immediate drain on the public purse, costing taxpayers more than £150,000 each by the time they hit state pension age, according to the Government’s tax and spending watchdog.
The Office for Budget Responsibility (OBR) said the average low-earner who came to Britain aged 25 cost the Government more overall than they paid in from the moment they arrived.
The cumulative bill rose to an estimated £151,000 by the time they could claim the state pension at 66, the watchdog said.
This is because low-paid migrants – who the OBR assumes earn half the average wage – put more demand on public services such as the NHS compared to their relatively low-tax payments.
The OBR estimated the cost to the public purse rose to almost £500,000 if they lived to 80, and more than £1m if they lived to 100.
By contrast, the average British-born worker boosts the public finances by £280,000 by the time they reach 66, even adjusting for education and health spending before they start work.
While low-paid migrants are a drain on public finances, the OBR found that the average migrant worker pays more in tax than they receive in public services throughout their lives compared to British-born workers. This is mainly because they are not educated in the UK.
Migrants also pay visa fees and health care charges, which the OBR estimates at around £12,500 for a migrant on a Skilled Worker visa who settles in the UK. Most migrants are also not eligible for welfare benefits for the first five years of their stay.
The watchdog also highlighted the benefits of attracting more highly-paid migrants to the UK.
Workers earning 30pc more than the average salary could expect to contribute a net £925,000 to the Treasury’s coffers until state pension age, the watchdog said.
These people would “still be a net benefit to the public finances even if they lived to 100”, the OBR said in its latest fiscal risks report.
By contrast, the OBR’s long-term tax and spending projections showed “an illustrative low-wage migrant worker arriving at 25 and earning half the UK average becomes less fiscally beneficial than the average UK resident in their early 40s”.
David Miles, an OBR official said: “I think the characteristics of migrants, in terms of their earnings and how long they stay, are as important, if not more important, than the absolute numbers.”
The OBR’s analysis will boost the case for the Government to cut down on low-skilled migration.
Net migration rose to a record-high 764,000 under the Conservatives.
Sir Keir Starmer has previously warned that employers have become “too reliant” on overseas workers and “should always have a choice of recruiting a British worker first”.
The Prime Minister has promised to cut “sky-high” migration figures, but refused to put a target on his ambition.
The Tories overhauled the UK’s visa system earlier this year, increasing the baseline minimum salary to be sponsored for a Skilled Worker visa from £26,200 to £38,700.
The previous government also banned social care workers from bringing dependents on their visa.
Yvette Cooper, the Home Secretary, has said she supports “some further restrictions on visas” introduced by the Government.
Mr Miles said that the wages of migrants made a “material difference” on Britain’s long-term debt trajectory. UK debt is already close to eclipsing the size of the economy.
In a scenario where all migrants earn 50pc less than average in the UK, the stock of debt would rise to 350pc of GDP by 2074, the OBR said, instead of hitting 275pc.
If all migrants earned 30pc more than the domestic population, debt would only rise to 225pc of GDP over the same period.
“The characteristic of migrants, perhaps not surprisingly, matters a great deal,” said Mr Miles.
The Imperial College professor has previously urged policymakers to get more people working instead of relying on immigration to reduce Britain’s debts.
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