Reform UK’s anti-immigration policies could trigger a significant economic downturn, economists warn, as the party’s plans for mass deportations and a “climate of fear” threaten to drive away skilled workers, deter foreign investment and undermine sectors from healthcare to higher education. The warning comes from Sushil Wadhwani, a former member of the Bank of England’s monetary policy committee, and is reinforced by research that sets out the scale of the potential disruption.
Mr Wadhwani argues that if a Reform UK-led government pursued forced repatriation – including of some people born in Britain – combined with an atmosphere of hostility, the economic damage would be “highly significant”. The party might want at least two million people to leave the country, he estimates, a figure far higher than earlier talk of deporting 600,000. That earlier target, now enshrined in Reform UK’s “Operation Restoring Justice”, would require the removal of roughly 120,000 people a year over a single parliamentary term, necessitating a huge expansion of detention capacity and charter flights. The most recent proposals also include establishing immigration removal centres, with a stated intention to prioritise locations in Green-voting areas.
The economic fallout from such a scenario would be markedly worse than the ongoing, relatively orderly fall in net migration, Mr Wadhwani stresses. While a reduction in migration driven by tighter visa rules will lower GDP growth, it is likely to raise GDP per capita over time. An exodus prompted by fear, by contrast, would cause immediate and deep damage. Losses of existing experienced staff, he notes, are far more damaging than a simple slowdown in new arrivals.
Sector-specific impacts
The health and social care sectors are already showing signs of strain. Home Office figures reveal a steep decline in the number of foreign nurses granted entry over the past three years, with the research briefing putting the fall at 93% between 2022 and 2025. Visas for caring personal service occupations have dropped 97% over two years to 2025. Experts quoted in the briefing warn of an “impending car crash” for hospitals and care homes. Minority ethnic NHS doctors and nurses already report increased levels of racism at work, Mr Wadhwani adds, and a Reform UK government could prove a tipping point that triggers a mini-exodus. The loss of experienced staff would push up NHS waiting lists, which in turn would worsen labour shortages across the economy and risk stoking inflation.
Education would also be badly hit. Mr Wadhwani warns that a climate of fear could deter minority ethnic parents from sending their children to the UK, potentially causing a “sudden stop” in the university system. The research briefing notes that visas for teaching and education professionals have already fallen by 71% in two years, and for skilled tradespeople by 73%.
Foreign direct investment, a crucial driver of growth, would suffer. Mr Wadhwani argues that corporate decision-makers in Japan or India would be less keen to locate key staff in the UK or travel here themselves. Some UK-based entrepreneurs have told him they are already thinking of ensuring their next investment is placed outside the country, prioritising their family’s safety. The London property market, long regarded as a safe haven, could lose its appeal, while official figures show that overseas residents made 42.5 million visits to the UK in 2024, generating £32.5bn – a flow that could also be disrupted. Property records indicate that Hong Kong nationals are the largest group of foreign property owners in England and Wales, but significant policy shifts could alter that landscape.
The comparison Mr Wadhwani draws is with the forced expulsion of Asians from Uganda by Idi Amin in the early 1970s. Before the expulsions, Asians made up about 1% of Uganda’s population but generated about 20% of its income and contributed close to 90% of its tax revenue. Amin expelled 60,000 to 80,000 people in 90 days, seizing more than 5,655 firms, ranches, farms and agricultural estates. The result was a sharp fall in GDP, a collapse in manufacturing, a dramatic drop in real wages, soaring inflation and the breakdown of essential services – consequences that forced the country to later invite the expelled community back in an attempt to rebuild. Mr Wadhwani contrasts this with the gradualist policies pursued by Kenya over the same period, which led to some slowing in growth but not macroeconomic collapse.
Broader growth challenges
Even without a Reform UK victory, the UK economy faces deep-seated problems. Productivity growth fell abruptly after 2008, from an average of about 2% a year over the preceding century to just 0.4% thereafter, Mr Wadhwani notes. Recent data shows a pick-up to 3.1% in the year to the third quarter of 2025, but from a very low base, and GDP per person has barely grown since before the pandemic. Professor Stephen Nickell of Oxford University identifies the main changes after 2008 as Brexit, high energy prices, the increased complexity of the tax system and the difficulty of building anything in a timely fashion. Mr Wadhwani adds falling public investment, the harmful effects of greater regulation across a range of economic activity, and the policy instability induced by the UK’s electoral system. The Brexit effect alone is estimated to have reduced UK GDP by 6-8% by 2025, with investment down by 12-18%.
The Labour government has said boosting growth is a top priority. Mr Wadhwani argues that moving from first-past-the-post to proportional representation could give businesses confidence that the broad policy thrust will remain unchanged over the medium term, thereby encouraging private investment. He notes that the government is already attempting to get closer to Europe, which appears a reliable way to get the Office for Budget Responsibility to upgrade its growth forecasts. On energy, British business faces among the highest industrial electricity prices in the world. There has been no significant growth-boosting tax reform yet, though Mr Wadhwani has long advocated shifting taxes away from capital and labour and towards land.
Uncertainty over future policy is already being priced into financial markets. Mr Wadhwani points out that the UK gilt market does not know who will set policy after the next election and therefore requires higher yields – meaning higher interest on loans to the UK. He recalls that Nigel Farage described the infamous Liz Truss budget of 2022 as the “best Conservative budget since 1986”, while Reform’s shadow chancellor, Robert Jenrick, has said the Office for Budget Responsibility will remain independent. All of these economic effects, Mr Wadhwani stresses, are only possible if the next election produces a clear majority for Reform UK and the party actually adopts the specific policies it has discussed. But with the impending election risk, it becomes even more important to deal with other obstacles to growth – a task he estimates will take at least a decade.
