Flawed contract design and poor delivery left Home Office unable to cope with demand for accommodation
The House of Commons Home Affairs Committee yesterday published a comprehensive and highly critical report on the Home Office's management of asylum accommodation.
Image credit: WikipediaYou can download the 123-page report here or read it online here.
In particular, the report criticises the way the Home Office has managed the use of hotels for asylum accommodation. Hotels were first used on a large scale during the Covid-19 pandemic, and their widespread use continued from 2021 onwards due to a significant rise in the number of asylum claims. The Committee finds the Home Office has not been able to control hotel costs and ensure that contract providers are delivering the accommodation required. The Committee calls the Home Office's response "chaotic".
The report states: "Instead of acting as a short-term contingency measure, the use of hotels has become a widespread and embedded part of the asylum accommodation system, increasing the cost of the asylum accommodation contracts by billions of pounds beyond the original forecast. This is the result of a series of failures by the Home Office in the design of the original contracts, and a manifest failure by the Home Office to grip the contracts and respond to increasing demand. The evidence we have examined leads us to conclude that providers can reap greater profits by prioritising the use of hotels over procuring other, more suitable forms of accommodation. Going forward, the Government will need to design a system that can flexibly respond to fluctuating demand while setting appropriate incentives for providers to maintain value for money."
On overall contract management of asylum accommodation, the Committee says the Home Office's approach has been reactive rather than proactive, with insufficient oversight and persistent neglect and inefficiencies leading to spiralling costs.
The Committee concluded: "We are persuaded by the evidence we have heard that, in the last Parliament, the Home Office focused on pursuing high-risk, poorly planned policy solutions and lost sight of the day-to-day work of effectively managing the asylum accommodation contracts. 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 of the situation, and allowed costs to spiral. The Home Office failed to undertake basic due diligence as it tried to respond to increased demand, most notably in the delivery of large sites, and has deprioritised the fundamentals of contract management. The Home Office was undoubtedly operating in an extremely challenging environment, but its chaotic response demonstrated that it was not up to this challenge."
The Committee criticised the Home Office for repeatedly ignoring warnings about the need to strengthen its commercial and contract management capacity. It found that the Department's failure to recognise and act on the growing scale and complexity of its asylum accommodation contracts left it ill-prepared to cope with the surge in demand. The Committee described this failure as unacceptable, noting that while recent efforts to build capacity and improve contract management were welcome, they came far too late. It also expressed concern that, given the Home Office's tendency to reallocate staff and resources, effective contract management could again be deprioritised in future, leading to a repeat of the same failings when the next crisis occurs.
As a result of poor contract management, the report highlights that providers have made significantly higher profits than was anticipated when the contracts were set up, with the Home Office lacking a mechanism to prevent providers making excessive profits, especially with hotels.
The Committee further noted that the standard of asylum accommodation provided was variable and sometimes fell significantly below acceptable standards.
The report states: "The quality of accommodation is highly variable across the country. While there is clearly accommodation of an acceptable standard, too many asylum seekers continue to be placed in accommodation that is inadequate or deeply unsuitable. The accommodation asylum seekers are housed in should be adequate, and it is unacceptable that significant amounts of taxpayers' money is being used to house often vulnerable people in sub-standard accommodation. The Home Office is ultimately responsible for ensuring asylum seekers are accommodated appropriately, and to fulfil this responsibility the department must hold providers to account where they fail to deliver the service they are being paid for. We have recommended earlier in this report that the Home Office strengthen its approach to performance management and oversight of these contracts. This is essential to ensure that vulnerable people are housed in adequate conditions."
Vulnerable asylum seekers were also failed with regard to safeguarding. The Home Affairs Committee said: "We are deeply concerned by the volume of evidence indicating significant safeguarding failings in asylum accommodation. While there are evidently pockets of localised good practice, the response to safeguarding concerns is inconsistent and often inadequate, leaving vulnerable people at risk of harm. We are particularly concerned that the Home Office does not currently have adequate understanding and oversight of vulnerabilities and potential safeguarding issues among asylum seekers it accommodates. While accommodation providers have safeguarding requirements, performance on safeguarding is not measured and failure to meet these requirements does not lead to financial penalties for providers. It is essential that the Home Office works to ensure that vulnerable people in its accommodation are safeguarded and that providers are upholding safeguarding standards."
Unaccompanied asylum-seeking children being placed in adult accommodation was highlighted as a serious safeguarding issue. The Committee stated that it lacked confidence in the effectiveness of the current system requiring accommodation providers to identify and refer age-dispute cases to the appropriate local authority. It warned that failures in this process risk children being wrongly placed in the adult asylum system, often sharing rooms with adults.
The Advice, Issue and Eligibility (AIRE) service delivered by Migrant Help to provide information, advice and support to asylum seekers, including over their accommodation, faced criticism for failing to keep up with demand. The Committee noted that it remains extremely difficult for asylum seekers to raise issues or complaints through the service and see them resolved.
Numerous other concerns are detailed across the report's pages. Acknowledging the significant challenges involved in providing asylum accommodation, the Committee emphasised that there is no single solution capable of resolving the fundamental issues in delivering accommodation at the necessary scale. It noted that while greater local involvement could bring benefits, such as improved coordination with other local services, responsibility cannot simply be handed over to local authorities or private contractors. Ministers must retain effective control and oversight. The Committee stressed that any move towards a more decentralised, locally led system must be underpinned by strong central coordination, sufficient resources, and a clear strategic framework to prevent fragmentation and ensure fairness and consistency across the system.
Committee Chair Dame Karen Bradley said the Home Office had overseen a failing and costly asylum accommodation system marked by chaotic, short-term responses and poor contract management. She warned that the Government must take control to reduce costs, improve oversight, and hold providers accountable for poor performance. While supporting the goal of reducing hotel use, she cautioned that the Home Office risks further failure if it makes unrealistic promises or continues to operate without a coherent, long-term strategy. Bradley urged the Home Office to learn from past mistakes and seize the opportunity to rebuild the system on a more stable and effective footing.