The Home Office is set to announce the closure of 11 asylum hotels this week, part of a pledge to end all use of hotels for asylum seekers by the end of this parliament. The use of hotels has been controversial since the start of the Covid pandemic, with anti-migrant protests and claims of luxury living.
Currently, nearly 200 hotels house 30,000 asylum seekers, with over 70,000 others in shared housing or military barracks. Protests have turned violent, including an incident in Rotherham in August 2024 where a hotel was targeted. Refugee NGOs and a parliamentary investigation have criticised the system as unsuitable and costly.
The Home Office will hold a private 'industry day' this week for accommodation providers, with details undisclosed until the last minute and attendees required to sign a non-disclosure agreement. The meeting relates to a new £10bn contract, Future Asylum Contracts Accommodation, running from 2029 to 2036, aiming to reduce reliance on hotels.
Concerns have been raised that the new contracts may increase inefficiency and costs. The Home Office uses part of the overseas aid budget for asylum accommodation, with costs falling from £2.8bn in 2024 to £2.4bn in 2025. Gideon Rabinowitz of Bond criticised this diversion of aid funds, noting cuts to humanitarian programmes.
A Home Office spokesperson said the government is closing asylum hotels and moving to basic accommodation, with the hotel population down nearly 20% in the last year and 45% since the peak under the previous government, saving nearly £1bn.
