In the words of 20th century essayist H. L. Mencken, “for every complex problem there is an answer that is clear, simple, and wrong.” For decades, mass migration has been the clear, simple, and wrong answer presented by politicians to every complex problem in British life.
Yet despite the fact that the economic and social disadvantages of the mass migration model are now abundantly clear, self-proclaimedly sensible commentators continue to insist that this failed approach is the only way to keep our unsustainable pension system on life support.
First, a few hard truths. The UK State Pension is funded from current tax revenues, rather than from money set aside in a dedicated pot built up over the course of a person’s working life. This “pay-as-you-go” ponzi scheme relies on future generations of workers to fund pensions for retirees, which becomes unsustainable as the population ages and the ratio of workers to pensioners shrinks, which is exactly what’s happening in the UK.
In fact, by 2040 there will be 22.7 million people drawing benefits (mostly pensions), versus only 34 million people working to fund it. The Adam Smith Institute has calculated that the State pension could become insolvent as soon as 2036.
And by 2042, the old-age dependency ratio will climb to 367 pensioners per 1000 working-age, likely requiring tax rates north of 60 per cent just to stand still.
So what’s the solution? Proponents of mass migration claim that new arrivals will prop up the tax base. It is an attractively simple idea. But there are two fundamental flaws in the argument: fertility convergence and lifetime net contributions.
First, while first‑generation migrants often have higher birth rates, subsequent generations rapidly adopt native fertility norms. Research on immigrant women in Norway shows Somalis go from an average of seven children per woman in Somalia to around two children by the second generation in Norway.
There is some evidence to suggest that certain immigrant groups are more resistant to native fertility norms than others, namely Bangladeshis and Pakistanis in the UK. This may be partly because of sustained migration from these countries, especially through spousal immigration, which reinforces their cultural norms favoring early marriage and larger families in the UK.
But the ONS concedes that higher migration will only artificially improve dependency ratios; it “will not prevent” an aging population. Even if we consider different migration scenarios (from zero to high net migration into the UK), the old-age dependency ratio will continue to increase. This means that mass migration could only be the solution to the pension crisis if we permanently imported working age migrants to the UK, forever.
Brits can no longer afford the lie that mass migration will salvage pensions
Second, the vast majority of migrants are not net contributors over their lifetimes. A Centre for Policy Studies analysis of 2022–23 skilled‑worker visa holders found that 72 per cent earn below the UK’s average salary, and 54 per cent earn less than half the average. Extrapolating, that means roughly 242,000 visas went to “low‑wage” migrants versus just 91,000 to high‑wage earners. And that’s before counting dependents, who often don’t contribute at all. Overall, only 12 per cent of visas issued in recent years were through the skilled worker route, with a fraction going to higher skilled migrants who could contribute positively to public finances. Far from bolstering the Treasury, most migrants draw on public services, leaving British taxpayers to pick up the tab.
This is not to mention the social and cultural downsides of mass migration. Communities in Britain are being changed without consent, leading to ghettoisation, alienation, and resentment. In dozens of towns across the country, authorities have ignored rape gangs for fear of seeming racist. The rape gang scandal is perhaps the most egregious example of how mass migration has damaged our social fabric, but with each passing day, mass migration continues to create a country which is less safe and more divided.
The only genuine solution is to restructure how pensions are funded, and to do so by learning from those who have already succeeded.
In the 1990s, Sweden shifted its state pension to a notional defined-contribution plan. Workers and employers contribute a percentage of wages into an account that grows based on wage or GDP growth rates. At retirement, this total converts into a pension paid at regular intervals, adjusted for life expectancy.
Singapore’s Central Provident Fund (CPF) is a fully funded, compulsory savings system. Both employees and employers contribute to an account over a worker’s career. These funds earn a government-set return and serve as retirement income, covering healthcare and housing needs.
Crucially, each generation funds its own retirement without the intergenerational dependency which characterises the UK system. Singapore’s system mandates one of the world’s highest savings rates, up to 37 per cent of wages in youth, tapering with age, ensuring most retirees are supported by their accumulated assets. CPF keeps pension spending remarkably low, with pension expenditure around 1.4 per cent of GDP, primarily for means-tested top-ups, compared to as much as 16.5 per cent across Europe.
The UK could and should transition to either model. These reforms demand real political courage, but the payoff is a pension framework that is solvent, intergenerationally fair, and robust against demographic change. Brits can no longer afford the lie that mass migration will salvage pensions. Instead of kicking the demographic can down the road, it’s time to overhaul the pension system.
