Asylum seeker hotel contract to be scrapped due to failures

The government will end a contract with a provider of hotel places for asylum seekers after an audit identified concerns about the firm's performance.

Stay Belvedere Hotels (SBHL) provides around a quarter of Home Office asylum accommodation in 51 hotels in England and Wales. It also operates Napier Barracks in Kent, which houses people awaiting asylum decisions and is due to close in September.

SBHL was sub-contracted under a £2bn-a-year deal agreed between accommodation services provider Clearsprings and the previous government in 2019.

An audit found issues with its behaviour as a supplier, although the Home Office did not give examples. SBHL said it had been informed of the decision.

SBHL's website says it offers a range of pastoral and welfare services that exceed the requirements of its contracts and ensure those staying in its hotels are treated with dignity.

Border security and asylum minister Angela Eagle said the decision had been taken because of greater oversight of asylum accommodation.

"We have made the decision to remove Stay Belvedere Hotels from the Home Office supply chain and will not hesitate to take further action to ensure Home Office contracts deliver for the UK," she said.

Speaking in the Commons later on Tuesday, Eagle said "significant elements" of the company's behaviour "fell short of what we'd expect from a government supplier".

She added the government would conduct a "full audit" of its supply chains.

Shadow home secretary Chris Philp claimed the number of those using asylum hotels had increased by 8,000 since the general election, despite Labour's pledge to end the use of hotels.

He added: "38,000 mainly illegal immigrants are now in those hotels, costing hardworking taxpayers around £2bn a year.

"It is completely unacceptable that taxpayers are asked to foot a bill this size."

The earliest point at which the Home Office can exit its asylum accommodation contracts without a break penalty is in September of next year.

Labour promised at the general election to "end asylum hotels, saving the taxpayer billions of pounds".

Responding to Philp's urgent question in the Commons, Eagle said the government was still committed to that goal but declined to set a date for achieving it.

The number of hotels being used to accommodate asylum seekers is not publicly available.

However, BBC Verify has obtained the figures via a Freedom of Information (FOI) request.

The FOI shows that there were 213 hotels in use during June's general election campaign. While that number initially fell, it increased to 218 in December.

There were 112,187 asylum seekers being supported in the UK at the end of 2024:

• 38,079 (34%) were in hotel accommodation. That figure is 32% lower than the peak of 56,042 at the end of September 2023

• 70,986 (63%) were in other accommodation, including initial, contingency and dispersal accommodation

• 3,122 (3%) were in receipt of subsistence support only.

The government is looking at plans for failed asylum seekers whose appeals have been exhausted to possibly be sent to the Balkans.

More than 5,000 migrants have arrived in the UK after crossing the Channel on small boats so far this year, according to latest figures.

In 2024 as a whole, 36,816 were detected making the dangerous crossing in small boats.