The Home Office has squandered billions of pounds on asylum accommodation due to flawed contracts and poor oversight, a new report by the Home Affairs Committee has found.
The cross-party group of MPs said billions of taxpayers’ money had been lost as a result of incompetent delivery, forcing the government to rely on hotels that were meant only as emergency measures.
According to the findings, projected costs for asylum hotel contracts between 2019 and 2029 have tripled from £4.5bn to £15.3bn.
The committee also said millions in excess profits made by private accommodation providers have yet to be recovered, with no financial penalties issued for poor performance.
The report described the current model under which more than 32,000 asylum seekers are being housed in 210 hotels, as “expensive, unsuitable and unpopular,” warning that it has fuelled tensions in local communities and failed to meet the needs of asylum seekers.
MPs attributed the crisis to weak contract management, a surge in small boat arrivals, pandemic pressures, and delayed asylum decisions linked to the former government’s Rwanda policy.
Committee chair Dame Karen Bradley said the system had rocketed in cost because the Home Office had neglected day-to-day management and lacked the skills to run major contracts.
The Home Office said it shared public anger over the situation and insisted it is closing hotels, cutting costs and exploring cheaper sites, including military bases.
Ministers maintain they are committed to ending the use of hotels by 2029.
