A confidential Home Office cost-benefit analysis obtained by the Financial Times reveals that July’s tightening of work and care-worker visa rules could hit UK public finances by as much as £10.8 billion over five years. The measures raise minimum salaries for Skilled Workers, close the Health and Care Worker route for most care homes, and shorten Graduate visas.
Officials estimate a £500–800 million fall in visa-fee income and up to £9.5 billion in lost tax because roughly 214,000 fewer migrants are projected to arrive between 2025/26 and 2029/30. A separate annex predicts a £1.2 billion hit to universities as fewer foreign students stay on.
![Internal Impact Assessment Warns Visa Clamp-Down Could Cost Treasury £10.8 Billion]()
Business federations argue the figures confirm that cutting legal migration harms growth and productivity, especially in social care where staff shortages already exceed 150,000 posts. Ministers counter that higher salaries will drive investment in domestic training and raise wage floors, but the assessment itself concedes there is "limited evidence" of productivity gains in the short term.
For global-mobility managers the headline is clear: sponsoring talent will become more expensive while backlogs may grow as employers rush to file under old salary bands before April 2026. Companies should model workforce plans against higher pay thresholds and consider switching some roles to the Graduate Trainee or Service Supplier sub-routes that still have lower salary minima.
Officials estimate a £500–800 million fall in visa-fee income and up to £9.5 billion in lost tax because roughly 214,000 fewer migrants are projected to arrive between 2025/26 and 2029/30. A separate annex predicts a £1.2 billion hit to universities as fewer foreign students stay on.
Business federations argue the figures confirm that cutting legal migration harms growth and productivity, especially in social care where staff shortages already exceed 150,000 posts. Ministers counter that higher salaries will drive investment in domestic training and raise wage floors, but the assessment itself concedes there is "limited evidence" of productivity gains in the short term.
For global-mobility managers the headline is clear: sponsoring talent will become more expensive while backlogs may grow as employers rush to file under old salary bands before April 2026. Companies should model workforce plans against higher pay thresholds and consider switching some roles to the Graduate Trainee or Service Supplier sub-routes that still have lower salary minima.
Source: Financial Times
