Migration has failed to drive economic growth, warns report — Analysis of Home Office data showed the impact of the shift from EU to non-EU migrants. Migrants from the Middle East, North Africa and Turkey aged 25-64 were almost twice as likely to be economically inactive as someone born in the UK

Although Britain's economy rose by 0.1pc across 2023, on a per person basis it fell by 0.8pc, the OECD said. This measure accounts for population growth, which in the UK was the second highest in the group of seven advanced economies.

The figures were in stark contrast to the G7 average, where GDP per capita rose by 1.2pc last year.

“If large-scale migration of the sort we've seen is really so great for the economy, we have to ask ourselves why we are not seeing this in the GDP per capita data,” the CPS report warned.

To alleviate pressure on housing, the NHS and schools, the CPS said net migration should be capped at just “tens of thousands” a year down from its peak of 745,000 in 2022.

To deliver this, CPS said the Home Office which had proven itself to be “too unwieldy to function effectively” and undermined by high levels of churn should be split into a department for border security and immigration control and a second charged with policing and national security.

The new department would be headed by a Cabinet-level minister. “We need working institutions that can translate the will of Parliament and the public into action. The Home Office has fallen short on this front,” they said.

Analysis of Home Office data showed the impact of the shift from EU to non-EU migrants. Migrants from the Middle East, North Africa and Turkey aged 25-64 were almost twice as likely to be economically inactive as someone born in the UK.

Spanish migrants typically earned around 40pc more than migrants from Pakistan or Bangladesh, while migrants from countries such as Canada, Singapore and Australia paid between four and nine times as much income tax as migrants from Somalia or Pakistan.

The report said the impact was particularly acute in housing. Net migration now accounted for around 89pc of the 1.34m increase in England's “housing deficit” – the amount of homes we have underbuilt by in the last 10 years.

Unforeseen levels of immigration have also blown house building targets out of the water. The Government's target of building 300,000 homes per year includes an expectation of net migration to England of around 170,000 per year, which alone will generate demand for 72,000 new homes.

“We have been underbuilding for years, even without high levels of net migration. And even if we limit ourselves to just the last 10 years, the picture is bleak,” the CPS report warned.

Pressure had also been added to rental markets, as well as affecting home ownership. For example, 67pc of privately rented households in London are headed by someone born overseas, as were 33pc of new social housing lets in Brent in 2022 to 2023.

Last year, Capital Economics estimated that the levels of immigration in 2022 alone may have driven up rents by nearly 10pc.

Immigration is heavily concentrated in cities and particularly in the rental sector. Previous ONS analysis found around 80pc of people arriving in the UK rent privately for at least the first few years after they migrate.

Mr Jenrick and Mr O'Brien blamed the post-Brexit Tory government for liberalising the immigration system and breaking its promises to take control of Britain's borders after leaving the EU.

“Despite the rhetoric of a highly selective system, the post-2021 system continues to allow large numbers of people to come who are either not working or working in very low-wage jobs. Out of net migration of two million non-EU nationals over the last five years, only 15pc came principally to work,” they said.

Many economists argue that high levels of immigration boost the UK economy by increasing the workforce and tax revenues.

But although levels of immigration have been extremely high, productivity growth and economic growth per person have slumped, just as pressure on public resources has soared.

Despite a 6.6pc increase in the UK's population between 2011 and 2021, the number of GP surgeries increased by just 4pc during the same period. The UK's capacity to generate electricity fell by 14.2pc.

Karl Williams, of the CPS, said: “Traditionally, the Treasury and much of the rest of Government have modelled immigration as an unqualified benefit to the public purse. But this is not the case.”

The report recommended abolishing the graduate route, which allows foreign students to stay for two years after getting their degrees. Instead, they could only remain if they had a graduate-level job within six months.

This would be allied to scrapping the 600,000 a year target for the number of foreign students allowed into the UK, which was set by Boris Johnson.

They recommended raising the salary thresholds for health and care workers above the national living wage, and minimum hourly wage in the care sector by 20p to 40p to help recruit more domestic workers. They also called for an immediate cap on the health and care visas set at 30,000, down from the current 250,000 in 2023.

Mr Jenrick said: “It would be unforgivable if the Government did not use the time before the general election to undo the disastrous post-Brexit liberalisations that betrayed the express wishes of the British public for lower immigration.

“The changes we propose today would finally return numbers to the historical norm and deliver the highly-selective, highly-skilled immigration system voters were promised. These policies could be implemented immediately and would consign low-skilled mass migration to the past.

“Immigration is consistently one of the top concerns of voters and they deserve a department whose sole mission is controlling immigration and securing our borders. For far too long, the Home Office has proven incapable of doing that.”