Nigel Farage and his party, Reform UK, have once again seized the headlines with a bold offer to end Universal Credit payments for European Union citizens living in the UK.
The plan, which the party claims could save billions, has sparked violent debate over its implicit impact on British taxpayers, trade relations with the EU, and the forthcoming 2025 Budget.
Critics advise that the move could transgress the Brexit deal and push up prices for shoppers across the country.
Reform UK’s EU Benefits Plan
Nigel Farage and his party, Reform UK, have stirred up controversy after unveiling plans to stop Universal Credit payments for European Union citizens living in the UK.
The move, which Farage claims could save around £6 billion, has drawn review from Labour and sparked fears of an implicit trade row with the EU.
The Reform UK leader is set to present his plan in a London speech on Tuesday, arguing that it prioritises British citizens over foreign nationals.
Speaking to Farage said: “With our sensible cost savings and putting the priorities of British people, not foreign nationals, first, there will be no need for tax rises thanks to our plans.”
Brexit Deal Concerns
Critics advise that the offer could violate the Brexit deal negotiated by the rightists, which allows EU citizens with settled status to claim certain benefits.
Labour said the policy pitfalls are driving trade pressures with Brussels, potentially leading to higher prices for British shoppers.
A Labour spokesperson said: “Nigel Farage’s fantasy numbers don’t add up, and he’d leave British taxpayers footing a hefty bill.
Farage is happy to slap British shoppers with higher prices at the checkouts by risking a trade war with Europe. He’d betray working people and hammer British businesses who want to trade with the EU.”
Reform UK has proposed a three-month transitional period for EU citizens currently receiving Universal Credit before payments are ended.
The party also plans to renegotiate the benefits element of the Brexit agreement, a move likely to face strong opposition in European capitals.
Impact on Taxpayers and Budget
Beyond benefits cuts, Reform UK has suggested additional measures totalling £25 billion aimed at easing the pressure on Chancellor Rachel Reeves.
These include raising the immigration health surcharge from £1,035 to £2,718 annually, a move the party claims could generate £5 billion in revenue. Reform UK argues these steps would reduce the need for tax hikes in the forthcoming Budget.
The Chancellor is due to unveil the 2025 Budget on 26 November, diving a multi-billion-pound gap while sticking to strict spending rules.
In a pre-Budget speech earlier this month, Ms Reeves hinted at possible tax increases, warning that “each of us must do our bit.”
Yet, new numbers from the Office for Budget Responsibility (OBR) indicate the space may be lower than anticipated, around £20 billion, offering slightly further breathing space compared to former vaticinations of £30 – £40 billion.
Labour has pledged its own Budget will focus on fairness and economic stability, promising: “strong foundations for our economy and secure our country’s future, with no return to austerity and no borrowing beyond our means.”
What It Means for Citizens
Still, Reform UK’s proposals could impact not only EU citizens but also the wider UK economy, if enforced.
Implicit trade pressures with the EU could significantly affect, leading to higher prices on everyday goods. Meanwhile, any renegotiation of the Brexit benefits deal could come with a long, politically charged battle, keeping British shoppers and businesses on edge.
