Reform UK fears the payouts will give Channel migrants an added incentive (Image: Getty)
Shabana Mahmood has been accused of handing migrants a £40,000 “prize” to cross the Channel in small boats. Unveiling radical reforms to the UK’s crumbling asylum system, the Home Secretary offered 150 families living in hotels the “staggering” sum to voluntarily leave the UK.
And in an explosive speech, Ms Mahmood revealed that children will be deported if their families refuse to take the cash. But the huge “incentive” sparked fury, with critics warning it could convince more people to try to cross the Channel. Reform’s home affairs spokesman Zia Yusuf declared: “They are not fleeing conflict, they are coming from France.
Home Secretary Shabana Mahmood delivers a speech to the Institute for Public Policy Research (IPPR), (Image: PA)
“They come because Tory and now Labour governments lay on a food bank for the world at British taxpayer expense.
“Free accommodation, free meals, free healthcare. The only way to stop this is to detain all of them and deport them.
“Unbelievably, Labour is increasing the incentive, by offering a staggering £40,000 package to illegals to leave voluntarily.
“That’s more than the median salary in Britain. As a prize for breaking in illegally. It’s a disgrace.”
Shadow Home Secretary Chris Philp said: “This is an insult to the British taxpayer.
“Shabana Mahmood has to resort to paying illegal immigrants to leave because she has utterly failed to forcibly remove them – only 6% of small boat arrivals have been removed under this Labour Government.
“Offering £40,000 to failed asylum seekers to leave the country will only reward and incentivise illegal immigration. If we exit the ECHR, we can deport all illegal immigrants without needing to pay them. But Shabana Mahmood is too weak to do this.”
Each person in 150 families will be offered £10,000 if they agree to leave within seven days – but the handouts are being capped at £40,000. They received the messages early on Thursday morning.
As part of the plan, the Home Office is consulting with experts on how to “physically handle children during the removal, where it is appropriate”.
A source said: “The average cost to a taxpayer, of each family, is £158,000 a year.
“They will have seven days to reply to that offer and then leave the country.
“Crucially, if they do not take this offer, we will look to forcibly remove them from the country. That includes children, but we will never separate parents from their children.
“This has been an incredibly successful model in Denmark, in terms of using incentives smartly to increase the removals of failed asylum seekers.
“We estimate, should the pilot be successful, we will save £20million for the taxpayer.”
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They added that migrants from Vietnam pay between £15,000 and £35,000 to reach the UK, whilst Syrians pay £10,000.
This, a source close to the Home Secretary argued, shows that migrants won’t be able to make money from the scheme.
And Ms Mahmood, in a speech to the Left-wing think tank the Institute for Public Policy Research, said: “For too long, families who have failed their claims have known that we were not enforcing our rules, which created a perverse incentive to make a channel crossing with children in the small boat.
“It is now on the parents in these families who can safely return to the home they came from to do the right thing.
“By accepting an incentive payment, rather than face an enforced return.”
Labour sources insisted Mr Yusuf has also vowed to pay migrants to leave the UK voluntarily.
The Home Secretary confirmed plans to boot migrants out of asylum accommodation and strip them of their cash if they break the law.
From June, the help will become “conditional” and only given to those “who genuinely need it and follow the law”.
Those who work in Britain’s black economy will also be thrown out of hotels, houses, flats and bedsits funded by taxpayers, alongside foreign criminals and those refusing to leave the UK voluntarily.
Some 30,000 migrants could lose their support, officials predicted.
She told the IPPR: “Once we have determined that somebody does not have a right to be in this country legally, it is essential that they leave.
“There is nothing fair about not enforcing our rules.
“Particularly as we know, many melt into illegal work, undercutting legal workers.”
Under Labour’s plans, migrants’ rights to permanent asylum will be scrapped.
Instead, they will be offered temporary status, which will be reviewed every 30 months.
If their country is deemed safe enough for them to return, they will be sent back. Only children who arrive in the UK unaccompanied will be exempt.
Until now, successful asylum seekers have been granted refugee status for five years and allowed to bring their families to the UK. They then got almost automatic fee-free permanent settlement with continued access to benefits and housing.
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Refugees will also be required to “earn” their settlement rights by working and contributing to society.
They will have to wait up to 20 years before they can apply to settle in the UK – and up to 30 years if they arrived illegally via small boats across the Channel or by claiming asylum after overstaying work, student or visitor visas.
Fury as Labour Accused of Handing Illegal Migrants a £40,000 ‘Reward’
Britain’s immigration debate has erupted into another fierce political controversy after Labour faced accusations that its policies could allow people who entered the country illegally to receive financial support worth tens of thousands of pounds. Critics have described the alleged arrangement as a £40,000 “reward”, arguing that taxpayers are being asked to shoulder the costs of a system that many believe has failed to deliver effective border control.
The claim has reignited questions about public spending, asylum accommodation and the distinction between supporting people who are legally entitled to assistance and creating incentives for irregular migration. For the government, the controversy presents another difficult communications challenge: how to explain the rules governing asylum and public support while convincing the public that immigration policy is being enforced fairly.
However, the precise basis of the £40,000 figure is crucial. Without a clearly identified policy, payment scheme or calculation, it should not automatically be interpreted as a single cash payment handed directly to every person who enters Britain illegally. Political claims about the value of accommodation, support and other services can combine different costs over time, and those costs are not necessarily equivalent to money received by an individual.
Why the Allegation Has Sparked Anger
For many taxpayers, the prospect of substantial public expenditure on people who arrive through irregular routes raises difficult questions about fairness. Households across Britain face pressure from housing costs, energy bills, food prices and local taxation. Some people are also struggling to access affordable accommodation or timely public services.
Against that background, reports of a potential £40,000 benefit have the power to provoke strong reactions, particularly among those who believe the government should prioritise British citizens and lawful residents facing financial hardship.
Critics argue that the state must be careful not to create the impression that breaking immigration rules can lead to more favourable treatment than following them. They say public confidence depends on a clear distinction between assistance provided to people who qualify for protection and financial incentives that could encourage others to enter the country unlawfully.
For opposition politicians, the allegation offers an opportunity to challenge Labour over its management of immigration and public finances. They are likely to demand a detailed explanation of how the figure was calculated, who would qualify for the support and whether any money is paid directly to individuals.
Those are legitimate questions for ministers to answer. Yet the answers depend on the actual policy involved, rather than the headline description alone.
Does £40,000 Mean a Direct Cash Payment?
One of the most important distinctions in this debate is the difference between a direct payment and the total cost of providing public services.
An asylum seeker may require accommodation while an application is being considered. Depending on their circumstances and eligibility, support may also involve food, essential living expenses, healthcare and administrative services. These costs can accumulate over an extended period, particularly when a claim takes a long time to resolve.
When critics add together the estimated value of these services, the resulting total may be presented as a financial benefit worth a substantial amount. But this does not necessarily mean that an individual receives the same amount in cash, can spend it freely or qualifies automatically for every form of assistance.
The distinction matters because public debate can become distorted when expenditure by the state is described as a personal reward. Accommodation costs, for example, may be paid to a provider rather than transferred to the person being housed.
This does not mean that the government should escape scrutiny over the money it spends. Taxpayers are entitled to know how much the asylum system costs, why certain arrangements are necessary and whether better alternatives are available.
It does mean that a £40,000 claim should be supported by a transparent calculation before it is treated as an established payment.
Labour Faces Questions Over Immigration Control
For Prime Minister Keir Starmer and his government, immigration remains a politically sensitive issue. Labour must demonstrate that it can manage asylum applications, reduce unnecessary expenditure and enforce immigration law while meeting its legal responsibilities.
The government has to address several connected problems. Applications must be processed efficiently, suitable accommodation must be available for people who qualify for support, and decisions must be made about those whose claims are rejected. Where someone has no legal right to remain and no outstanding legal barrier prevents removal, the government faces pressure to make the returns process effective.
These tasks are closely linked. If applications remain unresolved for long periods, accommodation costs can rise. If suitable accommodation is unavailable, authorities may have to rely on more expensive temporary arrangements. If removals cannot be carried out when legally appropriate, the system may struggle to demonstrate that its decisions have meaningful consequences.
Critics say these difficulties reveal a lack of control and that Labour must show measurable improvements rather than relying on explanations about the complexity of the system.
Ministers, however, must also consider the legal requirements surrounding asylum claims. Entering the country irregularly does not, by itself, establish that a person has no valid claim to protection. Each application must be assessed according to the relevant law and individual circumstances.
The political challenge is to explain that distinction without appearing indifferent to public concerns about border security and the cost of accommodation.
The Cost-of-Living Question
The controversy is particularly sensitive because it comes amid continuing concerns about household finances and the availability of public services.
For families struggling with rent, mortgage payments and everyday expenses, large figures associated with asylum support can seem difficult to justify. Some taxpayers question why the government appears able to fund temporary accommodation while local communities face pressure on housing, healthcare and council services.
The issue is not necessarily a simple choice between helping asylum seekers and supporting British households. Different areas of public spending operate under different legal obligations and budgetary arrangements. Nevertheless, ministers must be able to explain why money is being spent, what outcomes it achieves and whether the arrangements offer value for money.
If accommodation contracts are unnecessarily expensive or claims are taking too long to resolve, the government should identify the causes and explain how it intends to correct them.
Greater transparency could help distinguish unavoidable costs from expenditure caused by administrative inefficiency. Publishing clear figures on accommodation, processing times and the outcomes of asylum applications would also give Parliament and the public a stronger basis for assessing performance.
Without reliable information, however, the debate risks becoming a competition between increasingly dramatic financial claims.
Could Financial Support Encourage Illegal Migration?
Another central question is whether the support available to asylum seekers creates an incentive for people to attempt the journey to Britain.
Critics argue that the prospect of accommodation and financial assistance may influence the decisions of some prospective migrants. They believe the government must ensure that support arrangements do not become a substitute for effective border enforcement.
Yet migration decisions are influenced by many factors, including family connections, language, employment prospects, existing networks, conditions in countries of origin and the possibility of obtaining protection. The effect of any particular benefit or accommodation arrangement cannot be established simply by pointing to its estimated financial value.
A serious assessment would require evidence about the rules, eligibility requirements and the circumstances of those making the journey. It would also need to distinguish people seeking asylum from other categories of immigration.
The government must balance two responsibilities: preventing abuse of the system and ensuring that people with legitimate protection claims can access the procedures required by law.
If ministers believe a particular arrangement is creating unintended incentives, they should explain the evidence and consider proportionate changes. But sweeping claims about the motivations of all migrants are unlikely to provide an accurate account of a complex issue.
What About British Citizens in Need?
The allegation has also revived a broader argument about fairness in the welfare system.
Some people believe public assistance should always prioritise citizens who have worked, paid taxes and contributed to their communities. They question whether the rules governing asylum support are sufficiently clear and whether comparable attention is given to people experiencing homelessness or severe financial hardship.
These concerns deserve a serious political response. Governments must explain the eligibility rules for different forms of assistance and ensure that public funds are used for their intended purposes.
At the same time, asylum support and mainstream welfare benefits are not necessarily governed by identical rules. Eligibility can depend on immigration status, the type of support involved and an individual’s circumstances. It would therefore be misleading to assume that every asylum seeker receives the same benefits as a British citizen or has unrestricted access to the entire welfare system.
A constructive debate should examine the specific rules rather than treating all forms of public assistance as interchangeable.
Ministers should also explain how immigration policy fits within broader plans for housing, public services and poverty reduction. People are more likely to trust the system when they can see that the government is addressing pressures on communities rather than treating one group’s needs as the only priority.
Political Consequences for Labour
The £40,000 allegation could become another weapon for opposition parties seeking to portray Labour as weak on immigration and insufficiently attentive to taxpayers.
Reform UK has built much of its political appeal around border control, reducing irregular migration and challenging the costs associated with asylum accommodation. The Conservatives have also argued that the government must demonstrate stronger enforcement and more effective management of the system.
If Labour cannot clearly explain the financial claim, it risks allowing its opponents to define the debate. Even when a headline figure includes several categories of expenditure rather than a direct payment, the impression of a generous reward can prove politically damaging.
However, the government’s response should not be limited to rejecting the wording of the allegation. It needs to publish the relevant figures, clarify eligibility rules and demonstrate whether current arrangements are achieving their intended purpose.
A credible response would also acknowledge legitimate concerns about waste, delays and local impacts while explaining the legal obligations that shape asylum policy.
Ultimately, public confidence will depend less on a single political exchange than on whether the government can demonstrate progress over time.
The Questions Ministers Must Answer
The controversy leaves several questions that require clear, evidence-based answers.
What specific scheme or combination of services is the £40,000 figure supposed to describe? Is it a direct payment, an estimate of accommodation and support costs, or a calculation covering an extended period? Who is eligible, how long does support last and what safeguards prevent misuse? How much does the system cost overall, and what steps are being taken to reduce unnecessary expenditure?
These questions should be answered with published figures and explanations rather than slogans.
Britain’s immigration debate is unlikely to calm down while large financial claims circulate without enough context for the public to assess them. Nor will taxpayers be reassured by general statements that the system is complicated.
The government must show that it can control spending, process claims efficiently, enforce lawful decisions and protect the integrity of the asylum system.
For Labour, the political stakes are considerable. If the £40,000 figure is being used inaccurately, ministers need to explain why. If it reflects genuine weaknesses or excessive costs in current arrangements, they need to address those problems.
Either way, transparency is essential. The public deserves to know exactly where taxpayers’ money goes and what it achieves. Until ministers provide convincing answers, allegations about financial rewards for illegal migration are likely to remain a powerful source of anger and a persistent challenge for the government.