CSJ inquiry finds nearly two million foreign nationals on UK benefits

A Centre for Social Justice inquiry has found that nearly two million foreign nationals are claiming benefits in the UK, with the figure expected to keep rising. The think tank's policy director said the numbers include 1.3 million foreign nationals on universal credit and 400,000 on the state pension. He described the findings as evidence that the contributory principles behind the welfare state have been stretched almost to breaking point by years of large migration inflows.

The inquiry examined how the welfare system treats foreign nationals. It found that people who have worked in the UK for a certain number of years can qualify for the state pension, but that the UK applies a much lower contribution threshold for working-age benefits than many other countries. The policy director said that contrast is one reason taxpayers are questioning how the system operates.

The cost is significant. The interview heard that the total amount going to foreign nationals across the age groups examined is about 25 billion pounds a year, and the Centre for Social Justice estimates it will reach closer to 30 billion pounds by the end of the decade. The think tank also pointed to wider labour market trends. Since 2020, about 2.3 million people have moved onto out of work benefits. Over the same period, there was a 2.1 million net increase in foreign nationals from outside the EU joining company payrolls.

The policy director argued that this pattern can look positive to the Treasury in the short term, because it boosts GDP and borrowing capacity. But he said many of those workers fall out of work after around five years and then become eligible for different welfare benefits. He described this as a migration of people who came to the UK for work into the welfare system, with real consequences for the public finances.

The discussion also noted that not all foreign nationals receiving benefits are recent arrivals. Some have lived and worked in the UK for decades and have paid into the system. The policy director gave the example of a Danish person who has worked in the country for decades but cannot hold dual nationality and remains entitled to a UK pension. He also said NHS workers on low salaries who receive child benefit are likely to be included in the figures, and that this is appropriate.

Even so, the interview turned to whether the welfare state's underlying bargain has become too broad. The policy director said the political community is meant to look after everyone who falls on hard times, but that the borders of citizenship no longer seem to matter when it comes to claiming many benefits. He argued for a tougher distinction between British citizens and non-citizens, saying that is a debate that will run and run.

The Centre for Social Justice's figures are the centre of the latest phase of the argument over migration, welfare and contribution. They add to pressure on ministers to explain how the benefits system should treat foreign nationals, especially for working-age entitlements where the UK's contribution rules are looser than in comparable countries.