HUGE COST OF AMNESTY FOR ILLEGAL IMMIGRANTS QUANTIFIED


November 04, 2009

An amnesty for illegal immigrants would be bound to encourage further illegal immigration, their present number has been seriously underestimated and the lifetime cost would be in the order of £130 billion even on that low estimate of numbers, says a report out today from think-tank Migrationwatch.

The report is in reply to a paper published by the London School of Economics on 16 June in response to a request from London's Mayor. Introducing the document, Boris Johnson claimed it proved that immigrants were "far from a financial burden". He added:

"This new Report has introduced some long overdue facts, hard evidence and academic rigour into a debate which has far too often been dominated by myth, anecdote and hearsay".

Clearly the Mayor had not read the Report which makes it clear that "It has to be emphasised that these are ball park estimates at best" (page 110) and that "many of the numbers that had been generated for this Report have required heroic assumptions" (page 113).

The Mayor also claimed that:

"So far from a financial burden, as some suggest, this new research has found an amnesty could be worth up to £3 billion a year to the country's economy".

What the Report actually says is:

"Neither the literature nor currently available UK data provides a quantitative basis from which one could at all reliably start to estimate the scale of effects on UK output which would be likely to follow from regularisation"(page 73).

The Report is, in fact, astonishingly thin on its claim of economic benefit - just two paragraphs in 125 pages. It goes on to take what is described as "an example". This gives, on the basis of four hypotheses, an expected increase in GDP of some £3 billion (page 73).

Migrationwatch have now examined this Report in detail and have found that:

(a) The LSE report fails to deal with the central difficulty that an amnesty would be likely to encourage further illegal immigration. It omits any consideration of the key precedent of Spain where three amnesties since 2000 have led to a doubling of numbers on each occasion. The experience of Italy is similar.

(b) The central estimate of 618,000 illegal immigrants in the UK, adopted by the LSE, is very low since it assumes that, of the roughly 10 million people granted a visa between 2001 and 2007, only 1 in 200 overstayed - despite the absence of exit checks. Furthermore, their calculations take no account of additional dependants who will become entitled to join those who have been granted an amnesty. Despite this, we have calculated the lifetime cost on the basis of their estimate of the numbers.

(c) The "ball park estimates" in the GLA report put the annual cost of legalisation at about £2.4 billion a year (page 104), partly off-set by receipts of £0.8 billion, giving a net cost of £1.6 billion a year. Assuming an average working life of 33 years (from an average of 35 to 68), gives a working life cost of £52 billion. However, this assumes that those legalised will earn an average of twice the minimum wage and it includes only minimal costs for health and education on the grounds that illegals already have access to them. Correcting for these points brings that total to £77 billion, as explained in Annex C to the paper.

(d) Furthermore, the GLA made no allowance at all for post-retirement costs - apparently on the grounds that they are many years off. Assuming just seven years of retirement, from age 68 to 75, the total of these costs would be of the order of £57 billion, comprising Pension Credit (£21 billion), Housing Benefit (£21 billion), and health costs (£15 billion).

(e) Only ball park estimates are possible, as the GLA recognise, but our estimate for the whole life cost to the tax payer would be of the order of £134 billion, compared to the working-life GLA estimate of about £52 billion. Obviously, government revenues and expenditure over such a long period would also involve huge sums but these amnesty costs are both significant and largely avoidable.

Commenting, Sir Andrew Green, Chairman of Migrationwatch UK, said

"If this matter was not so serious, Boris's comments on the GLA report could be taken as one of his jokes. Unfortunately it is very serious. An amnesty would be bound to encourage still further illegal immigration as other countries have found and the life-time cost would be astronomical even on the low estimate of numbers in the GLA report. The way forward is to bear down on rogue employers and use the fines imposed on them to remove illegal immigrants as they are detected. This would deter rather than encourage the exploitation of illegal workers who are undercutting British workers and, indeed, taking jobs from them. Fortunately, the public has more common sense than London’s Mayor; our last opinion poll on the subject showed that 70% were opposed to an amnesty for illegal workers."



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