£20 levy on migrants to fund services

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Home Secretary Jacqui Smith said arriving migrants could be required to pay an extra charge on top of their visa fee to fund schools, hospitals and other services. The levy is likely to be on a sliding scale, with higher fees for the elderly or people with children, who will place a heavier burden on the state.

Critics of the Government's immigration policy are unlikely to be placated by the new charge, however, and will point out that the £15m a year it is expected to raise is minimal in comparison to the estimated impact on public services. It comes as Labour insiders increasingly fear they are losing public confidence over immigration. The party's pollster has warned the issue is a "vortex", threatening general election prospects. Local councils alone claim they need around £250m a year to meet costs, and the impact on the NHS and other services is significant.

The basic levy, which was being revealed in Parliament later today, is expected to be around 10 per cent of the £200 visa fee. More than a million migrants have been given British passports since Labour came to power in 1997, with more than 150,000 arriving last year, which was the second-highest figure on record. Fewer than 40,000 arrived in 1997.