It was in November 2025, that the Home Secretary, Shabana Mahmood, first announced proposals to change the length of time someone needs to be resident in the UK to be eligible for Indefinite Leave to Remain (ILR).
Since this announcement, which has left many feeling uncertain and anxious about their future in the UK, there has been a public consultation with over 200,000 responses, but no formal laws or immigration rules changes have been enacted. Whilst there is widespread acknowledgement that given the record levels of net-migration in recent years that the rules may need to change, the current proposals have drawn criticism across the Labour government and are generally considered to be unpopular.
So, what comes next? With no clear timeline for implementation, uncertainty over how far the proposals will ultimately go, and a change in Prime Minister and leadership now certain, what could this and the recent House of Lords Justice and Home Affairs Committee report mean for the future of these proposals, and for those who may be affected by them.
The House of Lords Justice and Home Affairs Committee has delivered a notably critical response to the Government’s earned settlement proposals. The Committee rejects the case for increasing the usual qualifying period for settlement to 10 years, and potentially longer for certain groups, and raises particular concern about the prospect of applying new requirements to individuals already in the country and on a route to settlement. In their view, the pathway should remain at 5 years, but this could potentially be separated from the eligibility to claim public funds, i.e. state benefits.
In the Committee’s view, retrospective application would also be highly unfair and could give rise to legal challenge. It also calls for any reform to be developed on a stronger evidential basis, with more robust migration data and a coherent integration strategy for England.
Their report on Settlement, Citizenship and Integration was published on 23 June 2026 and the Committee have been preparing for the inquiry since the release of the Immigration White Paper and Fairer Pathway to Settlement, i.e. earned settlement proposals late last year. The Government is expected to issue its response within two months, in line with potential implementation from October 2026, although it is not yet clear whether that timetable is achievable
The report draws sharp focus and criticism to the lack of useful UK migration data as current data publication focuses on arrivals and visas issued statistics. The Home Office has not published UK Exit data since 2020 and there is in-sufficient cross-departmental data sharing across the government to provide an accurate picture of who is in the country, what outcomes they experience after arrival and how migrants interact with public services.
Some of the key recommendations to the government include:
Following Keir Starmer’s resignation as Prime Minister on Monday, 22 June, the UK is now set for a new Prime Minister and Cabinet. This creates further uncertainty around the future direction, timing and political viability of the earned settlement proposals.
While a leadership contest cannot be ruled out at this stage, MP Andy Burnham has confirmed his intention to run for the Labour Party leadership, and others may yet enter the race. Against this backdrop, attention is likely to turn to his position on immigration and, in particular, how he may approach the Home Secretary’s earned settlement proposals which were due to be implemented from autumn this year.
There is enough in Andy Burnham’s recent comments to suggest that, if he were to become Prime Minister, the broad direction of UK immigration policy would be unlikely to move back towards a significantly more liberal framework. He has been careful to support the overall need for substantial reform of the asylum and immigration system and has recognised the political importance of demonstrating control over migration. That suggests continuity with the current Government’s emphasis on control, contribution and integration is likely to remain a central theme. It is also important to note that the current Home Secretary has indicated that she wishes to remain in post and see through her immigration reform programme.
However, his comments also point to a potentially more cautious and consensus-driven approach to the most far-reaching elements of the current earned settlement reform programme. In particular, he has expressed concern about leaving refugees or other migrants in prolonged uncertainty, especially where repeated reviews of their status could make it harder for individuals to integrate and harder for the Home Office to manage existing operational pressures. This may indicate that a Burnham-led administration would be more likely to revisit the length and rigidity of proposed settlement routes, including the 20-year route for some refugees and the retrospective application of longer qualifying periods for Indefinite Leave to Remain.
For employers, the direction of travel remains towards a more conditional settlement system, but the final shape of the reforms may still be politically contested. The timeline for any implementation may also be significantly impacted. A leadership change could lead to adjustments to transitional arrangements, retrospective application or the treatment of those already on a pathway to settlement, rather than a wholesale reversal of the policy agenda.
Employers should therefore continue to plan on the basis that the Government intends to take forward earned settlement reform in some form, while avoiding any firm assumptions until the final rules, impact assessment and transitional provisions are published. Having accurate workforce data readily available will be essential to enable employers to assess the impact quickly and make informed decisions once the final position is known.
For a deeper discussion on the above, please reach out to your Vialto Partners point of contact, or alternatively:
Lyudmyla Davis
Partner
Sarah Ingles
Partner
Ian Robinson
Partner
Andrea Als
Director
Tom Marsom
Director
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Director
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