Newly released figures indicate a significant decrease in government spending on hotel accommodations for asylum seekers between April 2024 and March 2025.
The Home Office’s annual accounts reveal that £2.1 billion was allocated to hotel lodging, averaging approximately £5.77 million per day. This marks a reduction from the previous year’s expenditure of £3 billion, or £8.3 million daily.
Analysis by BBC Verify suggests that the cost savings are attributable to a decline in the average nightly expense per person, following government initiatives to utilize more affordable accommodation options and implement room-sharing arrangements.
However, Dr. Peter Walsh, a researcher at the Migration Observatory at Oxford University, cautioned that the recent increase in small boat crossings could lead to a renewed reliance on hotel accommodations.
“Based on current trends, I don’t anticipate hotels becoming obsolete in the near future,” he stated.
Hotel accommodations are employed when alternative housing solutions for asylum seekers are unavailable, and the government has pledged to discontinue the use of asylum hotels by the end of the current parliamentary term.
As of the end of March 2025, 32,345 individuals were housed in asylum hotels, an increase from 29,585 at the end of June of the preceding year, but still lower than the total recorded in December.
A senior Home Office source indicated that a key factor contributing to the savings was the relocation of some asylum seekers from hotels to more economical accommodation types.
The department has prioritized relocating families and children into standard housing to minimize prolonged stays in hotels, the source noted.
BBC News has learned that the majority of individuals relocated from hotels are now residing in local housing or houses in multiple occupation (HMOs), a form of rented accommodation where at least three individuals share bathroom and kitchen facilities.
Most of these properties have been secured through the government’s contracts with Serco, one of the three firms responsible for asylum accommodation.
Additional savings have been realized through the renegotiation of elements within these contracts, which were initially established by the previous Conservative administration.
Officials have previously informed Members of Parliament that increased room-sharing in hotels has contributed to a reduction in the number of sites and per-person costs over the past fiscal year.
While the precise number of individuals sharing rooms is unclear, Home Office minister Angela Eagle has previously stated that “people can double up or treble up” if rooms are sufficiently large.
Home Office accounts suggest that 273 hotels were in use in March 2024, a figure that has now decreased by 71.
According to BBC Verify’s analysis of official data obtained via a Freedom of Information request, the average nightly cost per person decreased from £162.16 in March 2023 to £118.87 by March 2025.
The Home Office’s accounts also show that nearly £50 million in public funds was effectively written off after the Labour government abandoned a Conservative plan to use the RAF Scampton site in Lincolnshire to house asylum seekers.
Tens of millions had already been invested in the site when Labour assumed power and cancelled the plans.
The Home Office annual report states that this decision resulted in a “constructive loss of £48.5m,” but a department source asserted that the site would have been an even more expensive option than hotels, even when accounting for the incurred loss.
The report also confirmed that £270 million paid to Rwanda to support the country’s economic development was not refunded after the UK government scrapped the Rwanda scheme.
Conservative ministers had intended to send some asylum seekers to Rwanda as a deterrent against Channel crossings in small boats.
However, the scheme was delayed by legal challenges, and Home Secretary Yvette Cooper has indicated that it resulted in only four individuals being voluntarily removed to the country.
The Rwandan government stated last year that it was “under no obligation” to repay the £270 million following Labour’s decision to scrap the deal.
The authority expresses concern that replacing asylum-seeking families with single men will cause harm.
The hotel, which houses asylum seekers, sustains damage, and police vehicles are targeted.
Police report assaults on officers and damage to vehicles outside a hotel used to accommodate asylum seekers.
This development coincides with Friedrich Merz’s first official visit to the UK as German chancellor.
Muhammad Khan has resided in the south of England since 2021, with his family now joining him.