CUTTING net immigration to below 100,000 per year will push up Britain’s national debt by around 20 per cent over the coming decades, the spending watchdog warned yesterday.
Immigrants tend to be of working age and so do not cost the UK much on education, and will typically pay many years of tax before claiming pensions or requiring old age healthcare costs, the Office for Budget Responsibility (OBR) said.
As a result pushing down immigration will damage public finances.
If immigration continues at around 140,000 per year the OBR estimates the national debt will stand at around 100 per cent of GDP by 2062. However, if the government succeeds in pushing down immigration to the tens of thousands annually, that debt will rise to around 120 per cent.
“There will be fewer net inward migrants, making the fiscal position somewhat worse,” said OBR boss Robert Chote.
The OBR’s report also noted net emigration of older residents, in part because some migrants retire to their home countries.
The Treasury has been keen to try to address some of the long term costs of the ageing population. That includes raising the retirement age and considering linking it with life expectancy in a bid to put a cap on spending on pensions.