Cameron Benefit Curb Won't Deter EU Migrants, OBR's Nickell Says

  • Plan to Cut In-Work Benefits May Not Affect Migrant Numbers
  • Issue Threatens to Delay Completion of Negotiations with EU

David Cameron’s plan to curb benefits for European Union citizens coming to the U.K., one of the key reforms proposed by Britain in its renegotiation with the bloc, will do little to achieve its aim of cutting migrant numbers, according to the U.K.’s fiscal watchdog.

In testimony to lawmakers in London on Tuesday, Office for Budget Responsibility member Stephen Nickell cast doubt on the prime minister’s claims that reducing the draw of Britain’s welfare system would slow a rate of migration he’s called "unsustainable."

"I’m prepared to say any changes to benefit rules are unlikely to have a huge impact on migration flows," Nickell, a labor-market economist, told the House of Commons Treasury Committee. He refused to make more specific forecasts, stating that "to go further and start trying to analyze the consequences of these things is not in our remit on the basis that it’s not a policy." 

Britain’s request that EU migrants must contribute for four years before they qualify for benefits has proved the most contentious, with some countries branding the proposal discriminatory. The dispute makes it harder for Cameron to reach the renegotiation agreement with EU members he’s promised before a stay-or-leave referendum by the end of end of 2017.

‘No Consensus’

EU President Donald Tusk on Monday published his response to the list of demands sent to him by Cameron in November, saying there was "no consensus" on the matter of in-work benefits.

In its latest outlook, the OBR raised its net migration forecast for a second time this year, to 185,000 a year from 165,000. The figure rose to a record 336,000 in the year through June, driven by an upswing in arrivals of EU citizens.

Cameron’s pledge  to cut net annual immigration below 100,000, made before he first won office in 2010 and repeated in his election campaign this year, has never come close to being achieved. The EU’s free-movement rules mean he only has control over migrants from outside the 28-nation bloc.