That is a population bigger than Bristol. Think of the things needed to support that many people: schools, hospitals, transport, housing, food, water, energy........ They are the ones we know about, there are only guesstimates as to the number of those we don't know.
So, who are they? They are the backlog of unresolved immigrant cases, and it will take 37 years to sort them out. Except that if over that time we get an annual rate of unresolved cases of 10,000 it will become a problem without end.
These people are, officially, not allowed to work, so they do not appear as unemployed, yet they are entitled to some benefits - a cost to the nation.
Maybe it is time to be pragmatic about this. Why don't we have a moratorium on all immigration and an amnesty on those already here and clear the backlog? However, we need to be hard and clear if we do. If people are already here they can stay, but it is only them. There will be no admittance to spouses, children, family. If they do not like the deal we will pay for a one-way ticket out with a year's benefits to allow them to start over - no coming back.
It might sound expensive, but I believe that it is the cheapest option in the long run, and we have to do something.