Households containing foreign nationals received a record £11.9 billion in Universal Credit last year, with £7.7 billion of the payments going to households classed as jobless, according to government figures reported by The Telegraph.
The figures will pile further pressure on Labour over immigration, welfare spending and proposed reforms to the rules governing when migrants can settle permanently in Britain.
Data from the Department for Work and Pensions, obtained by the Centre for Migration Control through Freedom of Information legislation and first reported by The Telegraph, show payments to households containing at least one foreign national jumped from £9.5 billion in 2024 to £11.9 billion in 2025.
That represents an increase of around 25 per cent in just one year.
The figure has also risen dramatically from £7.5 billion in 2023, meaning annual Universal Credit payments to these households increased by £4.4 billion in only two years.
According to the figures, households containing at least one foreign national accounted for 15.6 per cent of all Universal Credit payments during the year.
Some £7.7 billion, around 65 per cent of the £11.9 billion total, went to households categorised as jobless.
The figures cover households containing at least one foreign national, an important distinction from saying that the entire sum was paid directly to foreign nationals. Foreign nationals can generally access Universal Credit only where their immigration status gives them recourse to public funds, which can include refugees, people with settled status under the EU Settlement Scheme and those with indefinite leave to remain.
Nevertheless, the scale and rapid growth of the bill will fuel an already fierce argument over whether Britain’s post Brexit immigration system has brought in too many people on wages low enough to leave households dependent on taxpayer support.
The row comes at an awkward moment for Labour, as Prime Minister Andy Burnham faces pressure from his own MPs over Home Secretary Shabana Mahmood’s proposed changes to settlement rules.
Ms Mahmood has proposed doubling the standard qualifying period for indefinite leave to remain from five years to ten, with some foreign care workers potentially waiting 15 years.
However, Mr Burnham is facing a rebellion from Labour MPs who want care workers already living in Britain protected from the tougher rules.
According to The Telegraph, as many as 100 Labour MPs, including Communities Secretary Angela Rayner, have backed calls to exclude care workers from retrospective changes, arguing that applying the new rules to people already here would be “un-British” and “unfair”.
The controversy matters because obtaining indefinite leave to remain can give migrants access to public funds where other eligibility conditions are met.
Official Home Office statistics describe ILR, or settlement, as a status allowing somebody to live, work and study in Britain without a time limit. The latest figures show 200,000 settlement grants were issued in the year ending June 2026, up 24 per cent on the previous year.
The latest Universal Credit revelations are also likely to reignite scrutiny of the huge increase in immigration which followed the introduction of Britain’s post Brexit immigration system.
The Office for National Statistics has since revised its migration estimates and now calculates that net migration peaked at 944,000 in the year ending March 2023. It has subsequently fallen sharply, with provisional net migration estimated at 171,000 in the year ending December 2025.
That fall, however, does not remove the longer term fiscal consequences of people who arrived during the record migration years and subsequently qualify for settlement and, potentially, taxpayer funded support.
Shadow home secretary Chris Philp described the Universal Credit figures as “shocking”.
He said: “These are shocking figures. British taxpayers should not be paying billions in benefits to foreigners, especially given that over half of these payments are for people out of work. Paying unemployed foreigners is an insult to hard-working taxpayers.
“If Shabana Mahmood U-turns on her own ILR reforms as looks increasingly likely, we will see even more low wage and unemployed foreigners qualifying for benefits.
“The Conservative plan is to ban foreigners from claiming benefits entirely unless they are qualifying EU citizens and make sure unemployed and low-wage foreign citizens leave when their visas expire.”
Robert Jenrick, Reform’s treasury spokesman, blamed the surge on immigration policies introduced under Boris Johnson.
He said: “Boris Johnson lowered the minimum-salary requirement for migrants and this ballooning benefits bill is the result.
“If Burnham bottles ILR changes, the Boriswave risks becoming permanent and will cost taxpayers tens of billions more. Only Reform will save Britain by abolishing ILR and ending all benefits to foreign nationals.”
Robert Bates, research director at the Centre for Migration Control, which obtained the figures, said: “These figures make a mockery of the suggestion that mass legal migration has been a boon for Britain’s economy.
“The importation of hundreds of thousands of low-wage, low-skilled individuals has been nothing short of a fiscal disaster and one that will only worsen should the Boriswave be given settlement.
“Britain’s welfare state should exist to exclusively help the British people. It is unconscionable that universal credit is being used to prop up the lifestyle of idle migrants. Whitehall must now give serious consideration to scrapping indefinite leave to remain and overhauling the naturalisation process.”
For Labour, the numbers raise uncomfortable questions about its priorities at a time when taxpayers are already being asked to shoulder an enormous welfare bill and ministers face difficult decisions over spending, taxation and the public finances.
There is also a growing political argument over fairness. Telegraph readers responding to the figures repeatedly contrasted the rapidly growing benefits bill with the debate over the affordability of support for British pensioners, including the triple lock.
Labour insists that migration has already fallen substantially and points out that people receiving these benefits are legally entitled to claim them.
A government spokesman said: “Under this Government, net migration is down by 82 per cent from its 2023 peak.
“Only people who are in the UK legally can claim taxpayer-funded benefits, of which around half are in work.
“Last November, we set out proposals to reform settlement which will double the standard qualifying period to 10 years for most migrants, with shorter routes for those who contribute most to the UK.”
The fall in net migration is substantial and is supported by the latest ONS figures, although the precise percentage depends on which periods and revisions are being compared. The latest provisional ONS estimate puts net migration at 171,000 in the year ending December 2025, compared with the revised peak of 944,000 in the year ending March 2023.
But the £11.9 billion Universal Credit figure exposes a different problem for Labour.
Reducing the number of people arriving today does not automatically erase the cost associated with the millions who arrived during the extraordinary migration surge of the previous few years.
And with £7.7 billion in Universal Credit payments associated with households classed as jobless, ministers now face a straightforward question from taxpayers: how much should Britain’s welfare system be expected to carry, and for how long?
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