UK urged to cut migrant hotel stays to free up overseas aid budget

In letter activists and refugee charities highlight that 20 per cent of foreign aid is spent on accommodation and tell Prime Minister to change course

Migrants on a small boat attempt to cross the English Channel. Getty Images

The British government has been urged by international organisations to divert its spending on asylum seekers' hotel bills to make up the shortfall in its overseas aid budget.

A record surge in migrant crossings into the UK has seen one fifth of foreign aid cash – £2.8 billion last year – used for migrant accommodation. A group of 106 international non-governmental organisations (NGOs) and charities have told Prime Minister Keir Starmer to break the costly hotel contracts and put migrants in more basic accommodation.

With Britain cutting its foreign aid budget from 0.5 per cent of national income to 0.3 per cent, in a letter to the Prime Minister the organisations said the huge costs for housing asylum seekers were damaging "efforts to create a more stable and peaceful world”.

Britain's Prime Minister Keir Starmer is being urged to put migrants in cheaper accommodation than hotels. AFP

Rather than pay hotel costs of £145 a night per refugee, the signatories urged the government to move them into large houses, flats or bedsits to cut costs. Currently, more than 38,000 migrants are in hotels while nearly 66,000 are in other accommodation.

The NGOs and charities called on the Home Office to trigger a break clause for a 10-year contract worth £4.6 billion for migrant accommodation, an action that can be taken next January. But the Home Office, which has a legal obligation to support asylum seekers who would otherwise be destitute, has resisted the move as there remains a lack of housing space across the country.

Record crossings

That pressure is likely to grow with the unusually benign weather in the English Channel this year leading to mass crossings. So far a record 8,888 people have made the journey this year, 42 per cent higher than in mid-April 2024. Tuesday saw the highest number of arrivals on a single day this year, when 705 migrants made the approximately 40km sea journey in 12 rubber inflatable boats.

Ministers hope to stop the flow in further agreements with France, including a migrant exchange deal, but that will take time.

‘Make the world safer’

Mr Starmer has promised to stop the use of the foreign aid budget for domestic asylum costs, but this is proving difficult, although the £2.8 billion spent last year was less than the £4.3 billion in 2023. Those are still staggering amounts, argue the charities and NGOs. They say they want to “express our concerns about the continued use of UK aid to pay for supporting people seeking asylum in the UK”.

In the letter obtained, by The Times, they also highlighted the long-term benefit of using UK aid “to help make the world a safer and more secure place”. They added: “We strongly encourage efforts to support refugees in the UK, but the current system is not fit for purpose.”

The letter was backed by MP Sarah Champion, chairwoman of the International Development Select Committee. The Refugee Council, International Rescue Committee UK, Safe Passage International and WaterAid were also signatories.

In a statement to The National, the Home Office said it was already closing asylum hotels which would “drastically reduce taxpayer costs”.

“Under the previous government, the [overseas] development budget was redirected towards the asylum backlog, which is now being tackled at record pace to redirect our focus on international priorities overseas,” it stated.

It added that decisions on people’s asylum status had increased by 52 per cent in the last six months, while the department had removed 24,000 illegal immigrants since last year’s election.