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@JWestland
C. Let them work, but then I know this is gonna happen: Because of them wages don't go up. See also Brexit.
That's the spiel when they can work. Not that the UK has a good track record of funding investigations into underpayment or strengthening laws (hi Labour, please sort this once/if you get in power) but you can maybe work around that and have some sort of extra tax to fund temp housing, idk.
I really don't see how all this cannot be worked out if we can talk like Mature Adults* in citizen panels rather than stupid news headlines being policy / us vs them political tribalism.
*maybe the issue ;)
They should be allowed to work as they are human beings, the boredom sucks. Then the living allowance is too low. Why not let them study as well and they can fund that with work.
But don't see them just as worker units, even Labour has this tendency of "immigration is just to generate £ for the UK..."