We need a counter-deliverution

In his 1982 book The Rise and Decline of Nations, American economist Mancur Olson warned of the danger posed by what he called “distributional coalitions”. 

These, Olson explained, consist of any organised minority group — from unions, trade associations or corporate lobbies to land-owning blocs, regional interests, even defence contractors — that join forces to secure concentrated benefits for themselves, often at the expense of the wider society. Their collective interests being so closely aligned, each cartel is compact enough to co-ordinate internally, concentrated enough to lobby effectively, and brazen enough to secure positive internalities whilst simultaneously seeking to offload costs as negative externalities borne by the wider public — usually via the government. 

Over time, these rent-seekers clog the regulatory bloodstream (in order to prevent competition), choke productivity growth (to shield themselves from market discipline), and thus leave the nation decrepit (to preserve their own position within a weakened system). Olson argues that the proliferation of such groups, combined with their support for redistributive policies, creates economic and political deadlock — especially in stable, pluralistic democracies where diverse interests have the greatest opportunity to organise and exert influence.

Naturally distributional coalitions do not just advocate to secure further benefits, but to protect those they already have. 

A handy example of how this works was the warning issued by Uber Eats this week, as reported in the Telegraph, that a Home Office crackdown on illegal gig economy labour could drive up the price of takeaway deliveries. In newly filed accounts the company formally welcomed efforts to deter small boat crossings and disrupt people-smuggling networks, but cautioned that “new legislative requirements could have an adverse impact on our business, including expenses necessary to comply with such laws and regulations”.

This, of course, is an implicit admission that Uber Eats is well aware that its business model has enabled people circumventing immigration laws. The gig economy has quietly become a de facto employment system for undocumented migrants, largely because of its frictionless entry: with little more than a smartphone and a rented bicycle, anyone can start earning. 

Over the past year, Deliveroo, Uber Eats, and Just Eat have all introduced voluntary “right to work” checks on their platforms, incorporating facial recognition and document verification tools. These measures have led to the removal of thousands of workers who failed to meet legal requirements.

But despite the impressive numbers, measures introduced are little more than a tickbox. It is still relatively easy for illegal workers to bypass right-to-work checks by renting verified accounts from legitimate users, typically for £70 to £100 per week. This arrangement enables thousands to operate undetected, with no formal vetting and minimal oversight. In July, the Home Office warned that abuse remains widespread and secured further commitments from the companies to tighten enforcement and suspend suspicious accounts.

The true scale of illegal employment in the sector remains opaque. While around 450,000 people are estimated to work in the gig economy overall, fewer than 85,000 are in food delivery. Yet the signs point to widespread abuse; research conducted in six cities across four continents found that platform labour is overwhelmingly migrant-driven, and a Home Office response to a Reuters FOI request revealed that 42 per cent of riders stopped during a six-day enforcement sweep in April 2023 were working illegally. 

Critics of the asylum system often claim that pressure would be alleviated if they were simply allowed to work — a comment that belies the ignorance of so many of the migration activists who try to pass themselves off as “migration experts” about how easy it is to secure work already. What was once hailed as a flexible, low-barrier job market has become one of the most potent pull factors for illegal migration to the UK. As a result crackdowns on illegal working in the sector, long overdue, are in the pipeline.

As Home Secretary, Yvette Cooper had proposed legislation mandating all gig economy platforms to verify the legal status of their workers. Frankly, were people to know that this was not already the case, they would likely be shocked. Meanwhile, officials have also begun sharing data on asylum hotels with delivery firms to help identify undocumented workers attempting to access the apps.

But as Charlie Munger said, “Never, ever, think about something else when you should be thinking about the power of incentives.” In its latest UK accounts, covering both ride-hailing and food delivery operations, Uber reported a revenue increase from £5.3bn in 2023 to £6.5bn last year. However, profits fell from £29.4m to £21.6m, which the company attributed to rising administrative costs within its food delivery division — likely a reflection of the growing compliance burden.

The public deserves better than a system that quietly subsidises lawbreaking while passing the costs onto taxpayers

So long as the food delivery platforms make greater profits off the back of illegal immigration, they will continue to resist serious measures against illegal immigration. In a sector based so heavily — and now, openly — on the use of illegal labour, the government has not only the right but the obligation to intervene. The use of illegal labour should come with prohibitively massive penalties for even a single instance, and alongside a biblical increase in penalties these companies should be investigated, held to account, and forced to restructure their operations around legal employment.

The public deserves better than a system that quietly subsidises lawbreaking while passing the costs onto taxpayers. If the price of convenience is complicity, perhaps it’s time we rediscovered a more simple solution — learn to cook.