Rishi Sunak to raise UK visa fees and immigrant health surcharge ‘significantly’ to raise £1bn  

13 July 2023
The Prime Minister has announced a big hike in visa fees and the compulsory charges migrants face to access the UK’s health system to pay for public service pay rises.

Visa fees will rise by 15 per cent and upwards (see below) and the Immigration Health Surcharge is set to increase by 64 per cent, in a move that those who work with migrants on lower incomes warn will push many into debt at a time when price inflation is causing the cost of living to spiral upwards.

The full details of when fee increases will commence are expected soon, so it is worth getting visa applications in sooner rather than later to avoid the price rises.

Rishi Sunak linked the increase in costs to his current pay disputes with public servants. Under pressure to accept the recommendation of an independent review of pay for teachers, police, junior doctors and other public sector workers, the PM confirmed a pay rise of between five and seven per cent across the board.

He told a press conference today that these wage increases would not come out of higher government borrowing for fear of worsening the inflation which has largely led to demands to increase public sector pay which has not kept up with price rises.

The PM told a Downing Street press conference: “What we have done are two things to find this money.

“The first is we’re going to increase the charges that we have for migrants who are coming to this country when they apply for visas.

“And indeed, something called the Immigration Health Surcharge, which is the levy that they pay to access the NHS.

“So all of those fees are going to go up and that will raise over a billion pounds.”

Sunak also he would be asking departments to “reprioritise” to support raising public sector pay, though he insisted, “it’s not about cuts, it’s just about focusing on public sector workers’ pay rather than other things.”

The Immigration Health Surcharge has already tripled in cost

The Immigration Health Surcharge (IHS) is currently a charge of up to £624 for adults to use the UK’s National Health Service (NHS) — with students, children and those on Youth Mobility Scheme visas paying a discounted rate of £470. It has already tripled since it was introduced in 2015 when it cost £200.

The Sunday Times hinted that the health fee could “at least double” to £1,200 on the weekend. But the paper was briefed that this fee immigrants pay annually until they are settled would be rising “to address mounting pressures on the health service.”

Since the Covid pandemic people coming to the UK on Health and Care Worker visas have not had to pay IHS fees. According to Government figures, around 220,000 out of 1.4 million staff report a non-British nationality. This amounts to one in six of NHS staff with a known nationality. Between them, these staff hold over 200 different nationalities.

Yet the Sunday Times report suggested the IHS fee hike was to fund the NHS, having been apparently briefed that “ministers believe that the high levels of immigration are placing greater pressure on the NHS, which is struggling to cope with a staffing crisis and record hospital waiting lists of 7.4 million.”

– A rather different priority from the reason in today’s speech for hiking the IHS to fund public service pay.

But I guess public service workers v immigrants is a better narrative than public service workers v the Government for a Government facing continuous strikes by public workers. Plus it makes it easier to sell what is essentially a tax on people migrating to the UK by a Prime Minister who promised no more tax hikes in the same speech.

By artificially conflating increasing the financial burden UK immigrants face with public sector pay, the Government knows that they will be able to accuse opposition parties objecting to the financial hardships caused of prioritising immigrants over native nurses, teachers etc – a useful distraction when you are refusing to increase their pay by the minimum they are demanding.

How much will the UK’s Immigration Health Surcharge cost?

Expanding on the Prime Minister’s statement, Chief Secretary of the Treasury John Glen detailed public sector pay rises in Parliament today and insisted that the “increase to the surcharge will help to fund the pay rise for doctors.”

The IHS is set to increase by 64 per cent: from £624 to £1,035 per year, with the discounted rate for students, children and youth mobility visa holders increasing from £470 to £776 per year. We are yet to find out when this increase will happen but it will have to be voted on by both Houses of Parliament, and it still has not been tabled for either.

According to the Sunday Times report, an option of quadrupling the charge had been championed by the more radical anti-immigration New Conservatives who seem to be goading Home Secretary Suella Braverman on of late, but the paper suggested that the Treasury Department had favoured doubling the fee. So perhaps the increase could have been worse.

How much will UK visa costs increase by?

“We will increase fees across a range of immigration and nationality routes, including for people coming here to live, work and study at a time of record high migration numbers,” Treasury Minister John Glen told MPs.

He said that the cost of work visas and visit visas would increase by 15 per cent.

John Glen added that the Government would hike “the cost of study visas, certificates of sponsorship, settlement, citizenship, wider entry clearance, leave to remain and priority visas by at least 20 per cent.”

Suggesting such price rises would “help fund the pay rise for the police,” he also promised: “We are also equalising costs for students and those using a priority service, so that people pay the same whether they apply from within the UK or from outside the UK.”

Priority services allow applicants to pay extra to receive a decision on their visa or settlement application quicker. So currently, applying within the UK, you can pay £500 to receive a decision within five working days and £800 for a reply by the end of the next working day.  Without this, applicants could wait eight weeks or even up to six months in some categories.

Charges for “Priority” and “Super Priority” applications outside the UK vary: for typical work, study and visit visas it’s £250 for five working days and an additional £956 for a next day response.  For overseas applications by people joining a British spouse or partner, the “Priority” fee is £573 for a decision in six weeks, compared with the normal 12 to 24 weeks.

As the Treasury minister alluded, Student Visa application fees also vary: £363 if applying outside the UK; £490 to extend or switch to a Student visa from inside the UK.

We can only guess that the “equalising” the minister mentioned will be upwards. Whether that will be after an increase of upwards of 20 per cent has been added remains to be seen.

Again, no mention of timescale, so it may be advisable to apply for visas sooner rather than later. The immigration fees increase has to be voted on by both Houses of Parliament before being implemented.

Please contact us if you are concerned or want to make a swift application on +44(0)207 033 9527 or enquiries@vanessaganguin.com.

Rishi Sunak accused of treating immigrants as ‘cash cows’

Josephine Whitaker-Yilmaz of Praxis, a charity serving migrants and refugees said the PM was treating immigrants as “cash cows to be tapped when the need arises.”

She warned: “the people we see at Praxis already pay thousands of pounds each time they need to renew their visa, and are struggling to afford these fees, especially as the cost-of-living crisis drags on. More than half of the people we spoke to in research carried out last year were struggling to afford bills and food as a result of these visa fees… the government should be doing everything it can to get control of the cost of living crisis and ensure that every household has the support they need.”

Dr Madeleine Sumption, director of the Migration Observatory at the University of Oxford also warned: “costs will fall unevenly on different groups of migrants. For some skilled workers, employers will absorb the cost – the UK is already one of the most expensive countries in the world and employers will not like it, but depending on the amount they may well pay it anyway.

“The implications are more serious for the majority of migrants who pay the fees themselves. For example, a person joining their British partner in the UK already pays more than £8,000 in government fees in the five years they spend in temporary status.

“There is already evidence that some migrants acquire substantial debt in order to pay fees, so a ‘significant’ fee rise could greatly increase the financial burden on new migrants in the UK as they try to establish themselves here.”

The Prime Minister’s announcement today came amid a series of strikes by public workers struggling with inflation, on a day that junior doctors in England began another five-day strike after their demands for a 35 per cent pay hike were rejected by the Government. Trade unions responded sceptically to the Prime Minister’s announcement, suggesting the pay increases he was proposing would not be enough to help their members make ends meet. The British Medical Association (BMA), for instance, insisted that Rishi Sunak’s pay increase offer “fails to address” years of below-inflation pay deals.

The BMA chair of council Prof Philip Banfield said: “The proposed increase in the charges on migrant health workers to pay for the Government’s already-compromised pay deal is frankly shameful.

“The Immigration Health Surcharge is an additional punitive tax on much needed overseas colleagues. The NHS should be funded from general taxation, not charges that unfairly target individual groups – that’s why we called for abolishing this tax completely.

“Claiming to use it to fund an inadequate pay offer is especially insulting. The Government are pitting the public against each other, targeting one group to fund below-inflation offers for another when this country needs them desperately to help get the NHS back on its feet. This tax discriminates against immigrants.”