The government must urgently set up a hardship fund to help victims of the Windrush scandal who have fallen into financial difficulty, MPs have said.

Members of the Windrush generation, who arrived in the UK from 1948, as well as their children, have been wrongly targeted and in some cases left destitute by Theresa May’s “hostile environment” policies, which require employers, NHS staff, private landlords and other bodies to demand evidence of people’s citizenship or immigration status.

The influential home affairs select committee has called for a hardship fund to be set up after hearing the stories of victims including Anthony Bryan, who lost his job when he was told he was in the country illegally, and Sarah O’Connor, who has been unable to get work or claim benefits.

The committee has made the move ahead of the conclusion of a broader inquiry into the scandal.

Yvette Cooper, the chair of the committee, said: “Some of the Windrush generation are facing destitution. People are having to settle legal bills, or are facing bailiffs due to debts run up when they were forced to give up work or had their social security payments stopped through no fault of their own. The government must step in to help people immediately.

“Due to the seriousness of this issue, the home affairs select committee has agreed an urgent short report recommending that the government create a hardship fund, immediately, for those of the Windrush generation facing financial difficulties.”

The government has agreed to set up a compensation scheme but the process is set to be a lengthy one involving a consultation and a call for evidence from victims of the scandal. Lawyers have begun preparing group compensation claims on behalf of members of the Windrush generation.

As at the end of May, the number of potential Windrush cases reported to the Home Office had passed the 5,000 mark.

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