Cost of asylum hotels has dropped to £6m a day, says Labour peer

The costs involved in operating asylum hotels have reduced by a third, according to a Labour peer.

Speaking in a debate in the House of Lords yesterday (1 July), Lord Hanson of Flint (Labour) confirmed the government has stopped opening new hotels to house those seeking asylum in the UK.

He said: “We have reduced the number of hotels: in fact, we have fewer hotels now, in the week of the general election anniversary, than we had last year when the Conservative Party left office. It is our ambition to further reduce that.

“When the Conservatives were in office, hotel costs peaked at £9m per day. This time last year they were £8.5m per day, and this year they are £6m per day. That is still too high, but it is on the right, downward trajectory, and we will continue to safeguard in doing that.”

He added: “The [previous Conservative government] got us into the position of a rise in hotel numbers to a maximum of 400, a rising cost to £9m, a record number of people coming to this country, a failure to remove people who are being denied asylum, and a failure to process asylum claims in a speedy and effective way. We are clearing up his mess and doing the best we can to achieve that.”

Labour peer Lord Sahota drew attention to a report by Migrant Voice, which found the Home Office had received 1,500 complaints about asylum hotels in 2023 due to a lack of privacy, overcrowding, little access to healthcare and other “dehumanising” conditions.

Lord Hanson said the government’s objective was to provide accommodation that “meets all contractual standards and is safe, fit for purpose and properly equipped”.

The House of Lords debate comes after Chancellor Rachel Reeves committed to ending the “costly use of hotels to seek asylum seekers” by 2029 during her Spending Review last month.

Reeves said bringing an end to the use of hotels to house asylum seekers will save the taxpayer £1b a year.

Hundreds of hotels up and down the country have been used to house asylum seekers under both the Conservative and Labour governments.

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