Tony Blair’s Labour government pushed on with plans to open the UK’s borders to Eastern Europe despite mounting concerns from senior ministers, according to newly released official files.
The former prime minister relaxed immigration controls in 2004 after eight mainly former Soviet states, including Poland, Lithuania and Hungary, joined the EU.
Papers given to the National Archives in London show then deputy PM John Prescott and foreign secretary Jack Straw both urged delay to the policy, warning of a surge in immigration unless some restrictions were put in place.
But others – including then home secretary David Blunkett – argued that the economy needed the “flexibility and productivity of migrant labour” if it was to continue to prosper.
The records emerged as part of a yearly release of Cabinet Office files once they are 20 years old.
The papers also show:
Ministers in Blair’s government were advised to use post-it notes for sensitive messages to avoid having to release them under new Freedom of Information laws, which they had passed.
A senior US official warned the British ambassador to the US that George W Bush believed he was on a “mission from God” to crush Iraqi insurgents and had to be given a “dose of reality”.
Italian prime minister Silvio Berlusconi felt like a “jilted lover” after being shut out of talks between Blair and the leaders of France and Germany.
Former prime minister Sir John Major privately wrote to Blair urging him to order England’s cricket team not to compete in a “morally repugnant” tour in Zimbabwe amid concerns about its human rights record under Robert Mugabe.
Image: Then foreign secretary Jack Straw had reservations about the plan
Calls for open borders re-think
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The Blair government’s open borders policy is seen as having helped fuel anti-EU sentiment by the time of the Brexit referendum in 2016.
There was a major increase in immigration in the years that followed, with net migration rising to more than 200,000 a year and cheaper foreign labour blamed for undercutting local workers.
In 2013, Mr Straw admitted that the failure to put in place any transitional controls – as nearly all other EU nations had done – had been a “spectacular mistake” which had far-reaching consequences.
According to the Cabinet papers, the Home Office had predicted the impact of allowing unrestricted access to the UK jobs market for the new countries would be relatively limited – but within weeks the numbers arriving were far outstripping previous estimates.
Three months before the policy was due to be implemented, Mr Straw wrote to Mr Blair calling for a re-think, warning that other countries “who we thought would be joining us have begun to peel away”.
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Sir Tony Blair on leadership
“France, Germany, Spain, Austria, Belgium, Finland, Greece and Luxembourg are all imposing transition periods of at least two years. Portugal is likely to follow suit,” he wrote.
“Italy is undecided. Sweden, Netherlands and Denmark – who were with us – have all announced the introduction of work and/or residence permits for those wishing to avail themselves of the concession.”
He was backed by Mr Prescott who said he was “extremely concerned” about the pressures on social housing from a sudden influx of new migrants.
However Mr Blunkett, backed by work and pensions secretary Andrew Smith and the Treasury, insisted they should stick with the plan on “economic grounds”.
Image: Then Home Secretary David Blunkett backed the policy
He said that they would be tightening the regulations to stop migrants travelling to the UK simply to claim benefits but rejected calls for a work permit scheme as “not only expensive and bureaucratic but I believe ineffective”.
Mr Blair appeared to also express doubts, questioning whether tougher benefit rules on their own would be enough.
“Are we sure this does the trick? I don’t want to have to return to it,” he said in a handwritten note.
“I am not sure we shouldn’t have a work permits approach also. Why not? It gives us an extra string to our bow.”
Mr Blair also stressed the need to send out a deterrent “message” about benefits, writing in a note: “We must do the toughest package on benefits possible & announce this plus power to revoke visa plan and message to Romas.”
Bush ‘on mission from God’ in Iraq
Elsewhere in the Cabinet files, there was a record of frank conversations between Richard Armitage, the US deputy Secretary of State, and Britain’s ambassador to the US at the time, Sir David Manning, about the Iraq War.
In one meeting, Mr Armitage dismissed claims by the US commander in Iraq that he could put down a major uprising in the city of Fallujah within days as “bulls**t” and “politically crass”, and appealed for Mr Blair to use his influence with Mr Bush to persuade him there needed to be a wider “political process” if order was to be restored.
Image: Tony Blair with George Bush
In another meeting, Mr Armitage spoke of President Bush being faced with a “dose of reality” about the conflict.
Sir David reported: “Rich summed it all up by saying that Bush still thought he was on some sort of a mission from God, but that recent events had made him ‘rather more sober’.”
Italian PM felt like ‘jilted lover’
Other papers described a fall-out with Italian prime minister Silvio Berlusconi after he was excluded from a trilateral summit of the UK, France and Germany.
He is said to have been “hurt” because unlike the other two nations he had backed Britain and the US over the invasion of Iraq, and threatened to challenge Britain’s EU rebate at every opportunity as a result.
In a report of a meeting between Britain’s ambassador to Rome, Sir Ivor Roberts, and Mr Berlusconi’s foreign affairs adviser, Giovanni Castellaneta, Sir Ivor wrote: “The gist of what he had to say was that Berlusconi was feeling badly let down by the prime minister.
Image: Tony Blair with Silvio Berlusconi inside number 10 Downing Street.
“He actually used the image of a jilted lover (very Berlusconi) and added that there was something of the southern Italian about Berlusconi which made him quite vindictive when he thought his affections had been misplaced or betrayed.
“The word ‘tradito’ (betrayed) came up quite often.”
The row even came up during a video conference between Mr Blair and Mr Bush the following week, with the US president expressing “some concern in a jokey way, on Berlusconi’s behalf, over Italy’s exclusion”, according to a Downing Street note of the call.
In the face of such concerns, Mr Blair felt it necessary to travel to Rome to personally placate the unhappy premier and assure him of his continuing support.
John Major’s Zimbabwe intervention
The papers also revealed that former Conservative prime minister John Major – who preceded Mr Blair – privately wrote to his successor to urge him to “indemnify” English cricket for any financial losses if it was sanctioned for pulling out of a controversial tour of Zimbabwe.
Sir John, a noted cricket fan, said the tour was “morally repugnant” given Robert Mugabe’s human rights record, but pointed out that “draconian” rules by the world game’s governing body (ICC) imposed penalties on countries for cancelling – putting English cricket at risk of bankruptcy.
The letter came after Mr Blair had told MPs that in his “personal opinion” the tour should be abandoned, but it would “step over the proper line” for ministers to issue an instruction
Image: Sir John Major
Mr Major said if the government “expresses a view” that the tour should not go ahead – or there was a vote in parliament to that effect – then it would be “very difficult” for the ICC to penalise England.
And in the “very unlikely circumstances” that it were to do so, he said the government should indemnify the ICC for any financial losses.
“I daresay the Treasury would hate this, but the blunt truth is that the government could not let English cricket go to the wall because of a refusal to intervene,” Mr Major wrote.
The tour ultimately went ahead.
Ministers urged to communicate in post-it notes
Meanwhile, other papers revealed that ministers in Blair’s government were advised to use post-it notes for sensitive messages to avoid having to release them under the new Freedom of Information (FoI) Act.
The Labour government had passed the bill in 2000, which requires public bodies to disclose information requested by the public, but as its full implementation date crept up in 2005 there was growing disquiet about its implications.
One No 10 adviser wrote to Mr Blair suggesting post-it notes – which could presumably then be thrown away once the message had been read – as a way of getting round the requirement to disclose official material in response to FoI requests.
Taiwanese lawmaker Ko Ju-Chun has called on the government to consider adding Bitcoin to its national reserves, suggesting it could serve as a hedge against global economic uncertainty.
Ko, a legislator at-large in Taiwan’s legislative body, the Legislative Yuan, took to X on Friday to report that he had advocated Bitcoin (BTC) investment by the Taiwanese government at the National Conference on May 9.
In his remarks, Ko cited Bitcoin’s potential to become a hedge amid global economic risks and urged Taiwan to recognize the cryptocurrency alongside gold and foreign exchange reserves to boost its financial resilience.
Ko highlighted that Taiwan is an export-driven economy that has experienced significant fluctuations in its national currency, the New Taiwan dollar, amid global inflation and intensifying geopolitical risks.
“We currently have a gold reserve of 423 metric tons, and our foreign exchange reserves amount to $577 billion, including investments in US Treasury bonds,” the lawmaker stated.
In a scenario of more intense currency volatility or potential regional conflicts, Taiwan may “very likely be unable to ensure the security and liquidity,” Ko continued, adding that Bitcoin could be a great addition to Taiwan’s reserves for several reasons.
Ko Ju-Chun advocated for the adoption of Bitcoin by the Taiwanese government before the Legislative Yuan. Source: Ko Ju-Chun
“Bitcoin has been operating for over 15 years. It has a fixed total supply, is decentralized, and is resistant to censorship. Many countries are focusing on its hedging attributes. At the same time, in intense situations, it may not face the risk of embargo,” he said.
Instead, the legislator suggested adding a “small proportion of Bitcoin” into the diversified assets as tools for sovereign asset allocation and risk hedging, and backup capacity of Taiwan’s financial system.
“When exchange rate risk and regional uncertainty increase, it is time to introduce new tools to construct a more flexible financial strategy framework,” Ko said, adding:
“As former Dean Chen Chong said, Bitcoin is the gun of the digital era. It may also be the gold of the digital era, the silver of the digital era. Or it could be gunpowder. A wise nation will not let weapons be in others’ hands.”
German law enforcement seized 34 million euros ($38 million) in cryptocurrency from eXch, a cryptocurrency platform allegedly used to launder funds stolen after Bybit’s record-breaking $1.4 billion hack.
The seizure, announced on May 9 by Germany’s Federal Criminal Police Office (BKA) and Frankfurt’s main prosecutor’s office, involved multiple crypto assets, including Bitcoin (BTC), Ether (ETH), Litecoin (LTC) and Dash (DASH). The move marks the third-largest crypto confiscation in the BKA’s history.
The authorities also seized eXch’s German server infrastructure with over eight terabytes of data and shut down the platform, the announcement added.
eXch exchanged crypto without AML
In the statement, the BKA described eXch as a “swapping” service that allowed users to exchange various crypto assets without implementing Anti-Money Laundering (AML) measures.
The platform had operated since 2014 and reportedly facilitated about $1.9 billion in crypto transfers, some of which were believed to be of “criminal origin,” including assets laundered during the Bybit hack.
Example of flow of Bybit exploit funds moving through eXch and bridging back and forth between Ether and Bitcoin. Source: TRM Labs
“Among other things, a portion of the $1.5 billion stolen from the Bybit crypto exchange, which was hacked on Feb. 21, 2025, is said to have been exchanged via eXch,” the authorities wrote.
Multisig, FixedFloat among laundering cases
According to a post by crypto sleuth ZachXBT, eXch was also involved in laundering millions of funds from other crypto thefts and exploits, including Multisig, FixedFloat and the $243 million Genesis creditor theft.
Those were in addition to “countless phishing drainer services over the past few years with refusal to block addresses and freeze orders,” ZachXBT said.
Source: ZachXBT
ZachXBT was among the first security analysts to report on eXch’s links to laundering $35 million of crypto assets stolen from Bybit soon after the hack was confirmed.
“Lazarus Group transferred 5K ETH from the Bybit Hack to a new address and began laundering funds via eXch (a centralized mixer) and bridging funds to Bitcoin via Chainflip,” ZachXBT wrote in a Telegram post on Feb. 22.
“Even though we have been able to operate despite some failed attempts to shut down our infrastructure […], we don’t see any point in operating in a hostile environment where we are the target of SIGINT [Signals Intelligence] simply because some people misinterpret our goals,” it wrote.
Addressing the seizure, senior public prosecutor Benjamin Krause stressed the importance of action against “quick and anonymous opportunities for money laundering for any amount.”
“Crypto swapping is an essential component of the underground economy, used to conceal incriminated funds from illegal activities such as hacking or trading in stolen payment card data, thus making them available to perpetrators,” he said.
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