My Lords, the health charge reflects the cost to the NHS of providing healthcare to health charge payers. The increase supports the sustainability of our NHS, ensuring vital NHS services are funded and allowing wider NHS funding to be directed towards other priorities in the system.
The health charge was introduced in April 2015 to ensure that migrants contribute directly to the comprehensive and high-quality NHS services available to them from the moment they arrive in the UK. We all recognise the great contributions migrants make to help grow our economy and support our NHS; it is also important that those who use and benefit from our public services, such as the NHS, make a sufficient financial contribution towards the cost of these services.
The health charge is paid by temporary migrants applying for a visa to enter the UK for more than six months. It is paid up front, separate to the visa fee, and covers the full cost to the NHS of providing healthcare to those who pay it. Once paid, a charge-payer can access NHS services in broadly the same manner
as permanent residents without having made any prior tax or national insurance contributions. Where additional NHS charges are paid, these are consistent with those paid by a UK resident, such as prescription charges in England.
Since its inception the Health Charge has generated more than £5.1 billion for the NHS. The funds generated are shared between the health administrations in England, Scotland, Wales and Northern Ireland, using the now-familiar formula devised by Lord Barnett.
The health charge must be set at a level that broadly reflects the cost to the NHS of treating those who pay it. The current rate, introduced in 2020, as determined by the Department for Health and Social Care, does not currently do this. The new rate of health charge replaces that agreed in 2020 by this House; it reflects the increases in healthcare expenditure and revised assumptions of migrant use of healthcare services. Using more recent and representative data better reflects NHS service use by health charge payers.
The order amends Schedule 1 to the Immigration (Health Charge) Order 2015. The full rate of the charge will increase to £1,035 per person per annum, with the discounted rate for students, their dependants, those on youth mobility schemes and under-18s, increasing to £776 per person per annum. These levels are currently set at £624 and £470 respectively.
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Furthermore, the draft order amends Schedule 2 to formalise existing exemptions from payment of the health charge for migrants applying to the statelessness immigration route and those applying to the Ukraine schemes. I know this move will be welcomed across this House, as it places these exemptions on a legislative footing and provides clarity for applicants.
It is worth remembering that the charge does not apply to those who apply to settle in the UK, recognising the strength of their long-term commitment to our country and the contributions they have made while living here. Furthermore, safeguards exist. The Government recognise that the cost of the health charge may be unaffordable for some. On family and human rights routes a fee waiver application can be made, and a full fee waiver will be granted if it is determined that the applicant cannot afford the visa fee and the health charge. A partial fee waiver can be granted if it is determined they can afford the visa fee but not the health charge as well.
The health charge is designed to benefit the NHS and support its long-term sustainability. The government manifesto committed to increasing this charge to NHS cost recovery levels. The order delivers that commitment, and I commend it to the Committee and beg to move.