The Government still does not have “a credible plan” for getting people out of asylum hotels, a local MP has said, echoing a new report.
The Home Affairs Committee, chaired by Biddulph MP Dame Karen Bradley, has published the Government’s response to its report into asylum accommodation.
The report had found flawed contract design and poor delivery had left the Home Office unable to cope with the demand for asylum accommodation.
It called on the Home Office to learn from past mistakes to develop a clear long-term strategy that provided value for money, adequate accommodation standards and took account of the impact on local communities.
Chair of the Home Affairs Committee, Biddulph MP Dame Karen Bradley, said: “It is welcome that the Home Office has finally started to get a grip on the asylum accommodation contracts, including by enhancing its contract management capacity and recouping excess profits made by providers.
“However, the department still has yet to demonstrate it has a credible plan for getting out of asylum hotels, and delivering suitable alternative accommodation in a way that takes into account the impact on local areas. The Home Office has also not taken on board our recommendations for strengthening its approach to safeguarding, despite the serious concerns we heard during our inquiry.
“Ministers and officials will need to stay focused on the important work of contract management, and show they have learned the lessons from past mistakes, if they are to meet the Government’s commitments to close asylum hotels and cut the cost of asylum accommodation.
“We will continue to hold them to account if they fail to do so.”
The report had said that the expected cost of the Home Office’s asylum accommodation contracts for the ten years between 2019–29 had more than tripled, from £4.5 billion to £15.3 billion. External factors — the pandemic and the dramatic increase in small boat arrivals — and decisions by the previous Government, such as pausing asylum decision-making while it pursued the Rwanda scheme — meant that the Home Office had had to accommodate a growing number of people for longer periods of time.
At the end of 2018 around 47,500 asylum seekers were accommodated by the Home Office. As of June 2025, the Home Office was responsible for accommodating around 103,000 people.
The number of asylum seekers in hotels is currently lower than during the peak of hotel use — 32,059 people as of June 2025, compared to 56,042 in September 2023 — although the number of asylum seekers accommodated in hotels was 8% higher in June 2025 compared to June 2024.
The committee heard powerful evidence that during the 2019–2024 Parliament, the Home Office focused on pursuing “high-risk, poorly planned” policy solutions. Failures of leadership at a senior level, shifting priorities and political and operational pressure for quick results meant that the department was incapable of getting a grip on the situation, and allowed costs to spiral.
The Home Office has become heavily reliant on the costly use of hotels for asylum accommodation, which are unpopular with local communities and largely unsuitable for accommodating asylum seekers.
In its response, the Home Office said it recognised that hotels had became “a significant part” of the asylum accommodation system due to “unprecedented demand and limited contractual flexibility”.
As part of the Government’s Restoring Order and Control programme, the Home Office said it would design a future asylum accommodation system that responded to fluctuations in demand.
it said that hotel use had already reduced substantially, from more than 400 at its peak to 197 in use as of 5th January but the Government was committed to exit all asylum hotels as soon as possible.
The Government also said that 93% of excess profits made be service providers identified by the auditors had been returned to the Home Office, with the validity of the remaining 7% still under discussion and negotiation underway with the aim of swiftly agreeing the return of this remaining money.
