Asylum hotels costing taxpayer £15 million a day, figures show

The Government is forking out £15 million a day on putting up asylum seekers in hotels, spending £4.3 billion more of taxpayer money than budgeted on asylum support in the last year, Labour has said.

The Opposition party pointed to Treasury figures that estimate the Home Office spent £5.4 billion on asylum accommodation and support.

Labour accused the Government of blowing its £1 billion 2023/24 budget for supporting arrivals while their asylum claim was being processed as the backlog soared.

The Home Office’s top civil servant said the extra money claimed in the Treasury “supplementary estimates” was “a result of record levels of small boat arrivals since the Spending Review 2021”.

Permanent secretary Sir Matthew Rycroft wrote in a letter to the Home Affairs Select Committee, published on Wednesday: “Both the Home Office and HM Treasury recognised that asylum was a volatile area to budget. As a result, in subsequent financial years both departments have worked together to manage additional costs through the usual process of Supplementary Estimates.

“The Home Office has also been managing it through efficiency savings. Indeed, we are taking steps to ensure the asylum system delivers better value for money for the taxpayer, such as ending the costly use of hotels and looking at a range of alternative accommodation sites.”

The number of Channel arrivals is 32% lower than the total recorded this time last year (2,953) but 49% higher than the total at this stage in 2022 (1,482).

Some 29,437 migrants arrived in the UK after making the crossing in 2023, down 36% on a record 45,774 arrivals in 2022.

The Home Office allocated £1 billion to “asylum support, resettlement and accommodation” in 2023/24.

But escalating costs and the “failure to keep on top of the backlog (which currently stands at nearly 100,000 cases)” meant additional claims to the Treasury last year reached £4.3 billion, Labour said.

Ms Cooper said: “This lays bare the complete chaos the Tories have created in the asylum system. They are spending billions on hotel rooms because of their failure to clear the backlog of asylum applications.

“Despite promises of action from the Prime Minister, they have not delivered and now the Home Secretary has been forced to go to the Chancellor with a begging bowl because he’s bust his budget by over £5 billion.

“Families across the country, struggling with the cost-of-living crisis, will rightly want to know why the Prime Minister and Home Secretary are spending millions of pounds every day on asylum accommodation, rather than getting a grip of the problems they’ve created by letting the backlog spiral out of control.

“Labour has set out a clear plan to save billions of pounds for the taxpayer by ending asylum hotel use, recruiting over 1,000 new case workers and 1,000 returns staff to fast track safe country cases, process asylum applications more swiftly, and return those who do not have a right to be here.”

In response, illegal migration minister Michael Tomlinson said: “Labour have no plan to stop the boats and would take us back to square one meaning unlimited and uncontrolled immigration.

“Whether it’s campaigning to keep violent foreign criminals on our streets, voting against tougher immigration laws dozens of times or planning to dump the Rwanda plan even when it works – Labour won’t control immigration.”

The Home Office has been contacted for comment.