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The cost of housing asylum seekers examined

With the UK struggling to process record numbers of asylum seekers arriving on its shores, questions continue to be asked about the cost of the country’s immigration policy.

The government has “quietly handed” a £1.6 billion contract for its planned asylum-seeker housing barges to an Australian travel firm, Corporate Travel Management, said The Independent.

The two-year deal will cover the Bibby Stockholm and two additional vessels announced by Prime Minister Rishi Sunak earlier this month, “as well as bridging accommodation and travel services”, the Home Office told the news site. 

The three-storey “floatel”, moored in the privately run Portland Harbour off Weymouth in Dorset, would be “significantly cheaper” than hotels, said the Home Office. But MPs have refused to share the estimated costs of the scheme, and it faces local opposition even within the Conservative Party.

How much does it really cost to house asylum seekers?

Home Office estimates in February found there were “more than 45,500 asylum seekers in hotels costing the UK taxpayer £5.6 million a day”, approximately £2 billion a year. This was more than in 2022, when the department said the £1.5 billion-a-year system was costing “the highest amount in over two decades”.

The Daily Express claimed in March that “taxpayer funded hotels” were costing £6.8 million a day. But this ignores “that around £1.2 million of this cost goes towards providing ‘bridging accommodation’ for Afghan refugees who arrived in the UK via legal resettlement schemes”, said Full Fact, backing the government figure of £5.6 million a day.

Sunak said in December that this would have to stop in his proposals for the stringent new Illegal Migration Bill. But the expectation, said The Telegraph, is that hotels will be used until 2025, even after the bill becomes law. 

In 2022, the government spent almost £3.7 billion supporting refugees in the UK, including asylum seekers and those already granted refugee status, according to the House of Commons Library. This represented 29% of its overall aid budget and was a marked increase on the £1 billion spent in 2021. 

The government has acknowledged that “the costs of supporting those arriving from Ukraine, the resettlement of Afghans, and other asylum applications has put pressure on its aid budget for 2022”, it said.

The “ever-ballooning amounts of taxpayer money” being handed over to private sector providers for hotel accommodation for asylum seekers has stemmed from a “mounting case backlog and record dinghy crossings”, said Migration Watch UK last year. 

In December, the prime minister told the House of Commons that the asylum backlog – 132,000 cases at the time – was half the size of the backlog left by the Labour government in 2010.

But in what  The Guardian called a “rebuke” to the prime minister, the UK Statistics Authority (UKSA) disputed this, saying various statements by ministers “do not reflect the position shown by the Home Office’s statistics”. The UKSA chair said the backlog in 2010 was 19,000, meaning that outstanding claims had increased almost ninefold, to 166,000. 

What would the new plans cost? 

It will cost more than £20,000 a day to house 500 migrants on the Bibby Stockholm barge in Portland Harbour, said The Times in April. That includes £4,500 per day to berth it, plus the £15,000 daily chartering fee. 

Dorset residents, the local council and police are planning legal challenges over fears of negatively affecting tourism. The Conservative MP for South Dorset, Richard Drax, said: “We will look at any way we can to stop this.” 

The prime minister has said he also plans to house new arrivals in “disused holiday parks, surplus military sites and university halls”. 

Foreign Secretary James Cleverly has voiced his opposition to an RAF base in his Essex constituency being used as an immigration detention centre, said HuffPost. And Priti Patel, the former home secretary, took a similar stance on plans to use RAF Wethersfield near her Essex constituency. 

Meanwhile, the controversial plan to send asylum seekers to Rwanda has already cost the UK £140 million, paid to the Rwandan government, said the BBC last month. It would cost a further estimated £13,000 per person to fly them to the African country.

To date, no asylum seeker has been flown from the UK to Rwanda as the proposed scheme is still facing legal challenges.

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