Unsettled status: the policy and politics of indefinite leave to remain

Sunder Katwala looks at the government’s proposed reforms to settlement rules in the UK as part of its immigration policy overhaul and asks whether they could meet the fairness challenge. 

Securing public confidence on immigration policy has proved a daunting challenge for successive British governments. The Labour government’s attempt to break that cycle sees it pursuing three major policy reforms at once. Two of these were key pledges in its 2024 general election manifesto: reducing overall numbers to “sustainable levels” (without indicating what that sustainable level might be) and bringing back control to the asylum system. Labour’s third major initiative is the biggest overhaul of the settlement rules for decades. There was no mention of settlement or citizenship in the party’s manifesto.

Labour’s record is sharply contested in a polarised political debate. But on the specific pledges it did make, it has made more progress than is usually recognised.

Overall immigration numbers have fallen spectacularly. The government inherited record levels that were likely to halve due to the final decisions of the last government.  But Labour has reduced the numbers much further and much faster than almost anybody recognises, including government ministers and their political opponents.

So the fall in immigration risks being a very well-kept secret. There is a time-lag in the data but a bigger lag in the political discourse. The latest headline figure – net migration of 205,000 – relates to the 12 months up to June 2025. But published data shows there was a further 45,000 fall in visas by the end of the year – so the 2025 net migration headline number, which comes out in May 2026, will be down again. The Home Secretary used the mid-2025 headline number to tell the Home Affairs select committee that “net migration remains high by any measure”. Yet 2026 will almost certainly see the lowest level of net migration this century – and negative net migration is likely in 2027.

Another reason that the collapse in overall numbers has not been noticed is that asylum claims are rising. The data shows progress on reducing the asylum backlog, with incremental if slow progress on reducing the use of asylum hotels. The government has also sought to publicise a significant rise in removals. Yet boats crossing the channel make a lack of control visible. The question of what will and won’t work to secure control is contested.

It is the settlement proposals that have proved most contentious. Their aim is to reflect popular ‘rights and responsibilities’ principles – that those who join the club should show a willingness to contribute. Those principles underpin the current system – with English language, good character and citizenship tests, and the symbolism of the citizenship ceremonies introduced two decades ago. The key difference with earned settlement is a much more stratified approach. Some people could qualify in three years, and some in five years – but the timelines will be doubled as a baseline, trebled for some, and quadrupled for refugees.

These complex proposals are often misunderstood. Media reports invariably say the timeline will be ten years for most people – but a 15-year wait will be more common for those who came in the last parliament. That is not simply a rule for care workers, but for all mid-skill roles (below RQF Level 6): chefs, lab technicians, data analysts, electricians and hotel managers would all wait 15 years for settlement too.

The most contested issue has been whether or not it is fair to apply new rules to those already in the UK. Critics say this would move the goalposts. The government’s main argument has been that it would be unaffordable not to do so.

The Home Secretary deployed the eye-catchingly large figure of £10 billion in net fiscal costs for care workers and their adult dependants. Yet analysis by the IPPR and others has shown that the £10 billion figure is a mirage since the government’s proposal for a longer path to settlement would seem to make little, if any, difference to this number – and most costs would be incurred in three decades’ time.

So the key question is: what are the fiscal gains or costs of the government’s reform proposals?  MPs and peers have been trying to find out: the government appears to be stonewalling on supplying those details – but it will be impossible for parliamentarians to debate the current reforms, or possible alternative proposals, without the real numbers.

Earned settlement creates, by design, a hierarchy of status in terms of what different migrants deserve. A foreseeable but perhaps less directly intended consequence is to create a stratified hierarchy of settlement for dependents too. The child of a banker could be a citizen by the age of eleven, while his classmate who is the daughter of a cleaner at the bank would have a fifteen-year wait – and would not be eligible for home student fees.

To advantage the most affluent children while placing impediments to their working-class peers inverts the aims of the government’s opportunity agenda. The Home Affairs Select Committee has proposed several mitigations that could soften the impact on children – but it is an inherent feature of making parents “earn” their children’s settlement at different rates too.

The stratified hierarchy has a highly racialised pattern too. Most black and Asian migrants from Commonwealth countries will face a 15-year wait, while migrants from the EU and north America are likely to attain settlement earlier. Different patterns of dependent visas means there will almost certainly be a more racialised distribution for children than for adults. These lengthy timelines risk seeing people fall out of status too – risking the creation of a new Windrush scandal.

The settlement reforms are sharply contested, both on their core principles and how they will apply in practice. The Prime Minister has signalled a willingness to listen to the challenges made by care workers and their allies. “People do want fair rules. They want clear rules but they also want compassionate and fair rules” he said in a newspaper interview. The outcome will ultimately depend on a political judgment – about what can and cannot be defended as fair.

By Sunder Katwala, Director, British Future.