Labour's immigration U-turn to cost the British taxpayer an extra £5billion a year as up to 450,000 foreign nationals expected to sign up for benefits, Conservatives warn

Labour's immigration U-turn will cost the British taxpayer more than £5billion a year in extra welfare hand-outs, according to an astonishing new analysis.

The Conservatives said Home Secretary Shabana Mahmood's climbdown, announced on Monday, will lead to about 450,000 foreign nationals being able to claim universal credit by the end of the decade.

The estimated cost of £5.2billion a year by 2030-31 is far higher than the Home Office's previous figure, which put it at £10billion over the migrants' lifetimes.

A range of massive concessions to Labour MPs who opposed Ms Mahmood's original plan mean that out of 1.9million foreign nationals due to become eligible for settlement by 2030, only 500,000 will end up waiting longer.

The remaining 1.4million will remain on a five-year track to settlement in Britain – also known as 'indefinite leave to remain' (ILR) – which allows them full access to benefits and social housing.

The new Tory figures were based on official data showing just under 32 per cent of non-European Union citizens living in Britain with ILR currently claim universal credit.

Applied to the 1.4million given concessions under Labour's new measures it would mean 446,352 additional claimants, the Conservatives said.

Multiplied by an average annual payment of £11,694 it would lead to a total annual bill of £5.2billion by 2030-31, they added.

Home Secretary Shabana Mahmood this week announced a U-turn on previously announced plans, which could have implemented far tougher reforms to 'indefinite leave to remain'

Tory leader Kemi Badenoch said the Labour Government is 'obsessed with benefits'

Shadow Work and Pensions Secretary Helen Whately said: 'Our country cannot afford the ballooning benefits bill.

'People who come to the UK should be contributing, not drawing benefits.'

She added: 'We will prioritise Brits in the welfare system and stop giving benefits to immigrants.

'ILR and limited leave to remain will no longer give automatic access to universal credit and sickness benefits.

'This will save billions and there's a principle at stake here too: British citizenship matters.

'We are not a cash machine for the world.'

Shadow Home Secretary Chris Philp said: 'Settlement should be earned through work, tax and contribution. It should not be a ticket to a lifetime on benefits.'

Tory leader Kemi Badenoch said on Tuesday that migrants handed ILR under Labour's botched reforms will face being stripped of the status by a future Tory Government.

Foreign nationals will have their cases reviewed and if they fail to make a 'net contribution' to the country will lose their settled status here, she announced.

Mrs Badenoch said the Home Secretary had 'given up' on an earlier pledge to stop low-paid migrants securing ILR because Labour is 'addicted to welfare'.

She said Prime Minister Andy Burnham had 'ditched the Home Secretary's tougher proposals so that he can unite the Left behind him, and call an election'.

In a social media video, Mrs Badenoch said: 'Labour are the Welfare Party, obsessed with benefits - even if you're not British. Why? Because it helps them get votes.'

In March Ms Mahmood warned that a failure to implement her original blueprint, published last November, would lead to a '£10billion drain on public finances'.

She had insisted that diluting the proposals would be 'an affront to the idea of fairness within our society', while putting 'further strain on public services like housing and healthcare'.

But the measures have been rewritten after strident opposition from her own party, including Angela Rayner – now Housing Secretary – who castigated them as 'un-British'.

A Home Office source said: 'The last Conservative Government lost control of our migration system entirely.

'They lowered skills and income requirements to allow millions of people to arrive in this country. They handed out settlement to anyone, automatically, after five years.

'This absurd analysis assumes that we will be as hopeless as they were.

'It is totally wrong.

'We are ensuring that settlement can only follow contribution.

'Half a million people, who they handed visas to, cannot settle in the next five years because of the action this Government has taken.

'Under the Conservatives, they all would have been waved through.

'The Conservatives left a mess behind. We are dealing with it.'