A cross-party committee of MPs has condemned the Home Office for wasting billions of pounds on asylum accommodation, describing the system as 'failed, chaotic and expensive'. The Commons home affairs committee report, published on Monday, highlights mismanagement of hotels, large sites like the former Wethersfield military base, and shared housing under successive governments.
The report finds the Home Office 'incapable of getting a grip on the situation' and identifies 'failures of leadership at senior level'. Financial mismanagement of 10-year contracts with private providers Clearsprings, Mears and Serco, which began in 2019, saw contract values triple from £4.5bn to £15.3bn. Inadequate oversight meant failings went unnoticed, poor performance was not penalised, and excess profits were not reclaimed.
Specific financial failings include the purchase of the Northeye estate in East Sussex for £15.4m in September 2023, just a year after it sold for £6.3m; the site was later found to be contaminated and unused. The Home Office spent £48.5m on RAF Scampton in Lincolnshire but cancelled the plan due to soaring costs before any asylum seekers moved in. A taskforce discovered that 244 bed spaces had been charged for that did not exist.
The report raises serious safeguarding concerns, particularly about children being wrongly age-assessed as adults and placed in adult accommodation. It also notes that hotels, which account for over 75% of asylum accommodation spending, were more profitable for providers, creating a 'great disincentive' to move people out. The average cost of a hotel place per night is £144.98, compared to £23.25 for shared housing.
Dame Karen Bradley, chair of the home affairs committee, urged the Home Office to learn from past mistakes and develop a long-term strategy, rather than focusing on short-term, reactive responses. A Home Office spokesperson said the government is 'furious' about the number of illegal migrants in hotels and is taking action to close all asylum hotels, saving billions. The British Red Cross said the report confirms what it has long seen: a system in need of urgent reform.
