Thousands of illegal workers claiming British welfare payments: Loophole in the law costs taxpayers millions

Tens of thousands of workers with no right to be in Britain have been claiming benefits thanks to an extraordinary loophole in the law.

Ministers have discovered that Labour allowed 155,000 illegal immigrants to qualify for sickness benefits and maternity pay. Government sources put the cost to the public purse at ‘tens of millions of pounds’.

They say the shambles is a damning indictment of how Labour lost control of both the benefits and immigration systems with taxpayers left to foot the bill. Work and Pensions Secretary Iain Duncan Smith will outlaw the practice in welfare reform legislation expected to be unveiled this week.

Ministers believe most of those abusing the system came to work in Britain for a limited period and overstayed their visa. Others managed to get a job without a work permit.

At present, someone could be illegally in the UK and able to claim Employment and Support Allowance (ESA), paid to those too sick to work, as well as statutory payments such as maternity or paternity pay and sick pay.

Astonishingly, the Work and Pensions Department has not in the past asked to see work permits when assessing claims for ESA. Employers, meanwhile, have not been asked to show proof that workers are in Britain legally when processing claims for maternity or paternity pay or sick pay.

A Whitehall source said: ‘It cannot be right that people who aren’t eligible to work here can get benefits that are a substitute for earnings.

‘This is a classic example of where the welfare system has been allowed to get completely out of control. It is difficult to track because these are illegal workers, but the cost is likely to be in the tens of millions. ‘Clearly it’s incredibly unfair and ministers are acting to legislate to close the loophole as quickly as possible. 'Work permits showing people are here legally will be needed for ESA claims or an employer will have to show one when they are putting claims through. 'The Bill we are bringing forward will start the root-and-branch overhaul needed to put fairness back at the heart of the system.’

Hundreds of thousands of National Insurance numbers were handed out under Labour to illegal workers as, alarmingly, there was no requirement on JobCentre staff to check whether a person was in the country legally. Many employers wrongly believed that having an NI number meant foreign staff were allowed to work in the UK.

Illegal workers should not be eligible for any state-funded benefit, housing, or anything other than emergency NHS treatment. At the moment, a ‘habitual residency test’ is used to establish whether migrants are eligible for other types of benefit.

To qualify for jobseeker’s allowance, employment support allowance, pension credit and income support, they must demonstrate that they have either worked or have a good opportunity to get a job.

However, the European Commission has warned ministers that the rules may infringe the human rights of EU citizens and are ‘not compatible’ with EU law. It has started legal proceedings against Britain to have restrictions on welfare claims by incomers scrapped.

The Welfare Reform Bill, ministers say, will bring an end to the complex, costly and inefficient series of benefits and tax credits, replacing them with a single universal credit. Cuts to housing and disability benefits will also be confirmed.

The scale of the welfare challenge facing Britain is laid bare today in figures which show at least 330,000 children – around one in 30 – are growing up with a parent claiming Jobseeker’s Allowance.

Mr Duncan Smith said: ‘We know that family is the most important influence on a child’s life, so it is no surprise that with this many children growing up with parents on unemployment benefits we are facing intergenerational worklessness and benefit dependency on such a massive scale. ‘Our broken welfare system has reinforced this destructive cycle for generations.’

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Border security fail could be fatal for the Australian Labor Party

After Federal Parliament returns next Monday, there are sufficient grounds for the opposition to move the first no-confidence motion in the Gillard government. The trigger is the disintegrating credibility of Australia's border security, and the compromising of Australia's territorial sovereignty. On this fundamental moral and political issue, the Gillard government is unfit to govern.

The majority of the electorate takes this issue very seriously as a matter of principle. If a federal government cannot maintain territorial integrity the electorate will inflict political pain. That's why the phrase ''we will stop the boats'' were the first words of the mantra constantly repeated by Tony Abbott when he outperformed the robotic Julie Gillard in last year's election campaign. If an Australian government is perceived to be capitulating to the tactic of fait accompli on its borders by people demanding a right of entry, the government faces political death.

This principle is non-negotiable for most Australians. Thus the Coalition's chief pollster and electorate researcher, Mark Textor, put the words ''stop the boats'' first when he wrote that mantra. ''I put them first because it was the issue voters were putting first,'' Textor told me.

Now, six months on from the election, the Middle East is yet again in flux and the legal sieve that passes for Australia's border security is spiralling out of control. Could the Gillard government stop a big influx of illegal entrants? No. It doesn't have the policies.

None of us know whether we are witnessing a political spring or autumn in the streets of Cairo and Tunis. While the euphoria of people power in Egypt and Tunisia allows for hope, the Middle East has been utterly consistent in delivering political dislocations that eventually wash up on Australia's shores.

Literally. Look no further than the 15 bodies that have found their way, at great expense, to a morgue in Lidcombe. They are the remains of people who tried to get into Australia illegally and died in the process when their boat foundered.

Even as arrangements are made for their burial in Rookwood cemetery this week, the bodies, mostly Iraqi nationals, are the subject of legal wrangling.

It is typical of the legal quagmire that the Gillard government, and the Department of Immigration, have allowed to occur. I used to assume that the Department of Immigration was rigorous, impartial and transparent. I no longer make that assumption. In my dealings with the department I have found it both opaque and politely useless. Because there appears to be no point in dealing with the media unit, I am preparing a list of questions for the secretary of the department, Andrew Metcalfe. He will probably fob off the questions but the process will be public.

Metcalfe's department is busy spending an unprecedented amount delivering an ineffective program on the scale of waste comparable to Labor's national roof insulation scheme or school building program. This time the failure is destroying lives and inviting more of the same on a greater scale.

Last Thursday, the Gillard government asked for another $290 million to fund its border protection program. The opposition immigration spokesman, Scott Morrison, responded: ''In 2010-11 the government will spend more than $760 million on people arriving illegally in Australia. This compares to less than $100 million in annual expenditure when the Howard government left office in 2007.''

At this rate of spending, the cost of keeping each detainee has rocketed to $150,000 a year. It is not just the ridiculous cost. It's the mindset. The overwhelming majority of Australians would regard the people smugglers' boats as illegal entries. Yet the Department of Immigration cannot bring itself to use the term ''illegal''. It refers to these incursions into Australian territory as ''irregular''.

No wonder there is backlog of 6000 humanitarian cases clogging the scrutiny and review system. No wonder the Labor government, which railed against the Howard government's detention policies, is opening more and more detention centres. No wonder the centres are all overcrowded, leading the 2010 Australian of the Year, Professor Pat McGorry, to describe them as ''factories for producing mental illness''.

They are mental illness factories, because the vetting process is painfully slow, legal appeals are also ponderous, families are separated, violent disruptions are routine, and self-harm is common.

More than 2000 violent incidents are happening every year in the centres. Last week, in the latest known incident, about 40 detainees were involved in scuffles at the Darwin Airport Lodge detention centre. Six people were hospitalised.

All because this government is achieving the worst of both worlds: encourage the people-smuggler trade then lock up the arrivals.

While the majority of the electorate appear to believe that the last people who should be allowed permanently into the country are those who try to come in illegally, the Gillard government does not even forcibly return people it has ordered to be deported.

It does not automatically reject anyone who arrives without identity papers. Instead, it follows policies laid down by the United Nations Convention on Refugees and other UN protocols.

The combination of more arrivals, more detentions and slow processes means the average time spent in detention has risen to 183 days. Six months. Two years ago the figure was 25 days.

The federal opposition might want to ask why should Australians would want to accept this expensive debacle? A no-confidence motion would also oblige the man who made all this possible, the independent MP Robert Oakeshott, to stand up and defend the indefensible if he voted with the government on this issue.

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