Thanks for all of the useful replies. I have spoken to the UK Border Agency today, and they confirmed that my wife does need to have ILR before she applies for citizenship.
She already has the application forms, etc, but they can't be sent in until 1 month before her work permit expires in April.
I realise that my MP isn't going to waive the fee or arrange a discount, but I feel that I must formally register my opposition. Immigration is one of those topics that rarely gets reported in a balanced manner, with the likes of the Daily Mail scaremongering at every opportunity. The authorities need to know the affect that these charges have on ordinary, hard-working people!
