Source · Select Committees · Home Affairs Committee
Recommendation 16
16
Deferred
Conclude recouping excess profits from past years and establish annual audit process.
Conclusion
The Home Office should conclude the process of recouping excess profits for past years as quickly as possible and set out the amounts that have been returned to the department by contract providers. The Home Office should put in place an annual process for auditing profit share data submitted by contract providers and recouping any excess profits due. The department should report to Parliament on the outcome of this annual process. (Recommendation, Paragraph 71)
Government response summary AI-generated
The government's response deflects the recommendation to recoup excess profits and implement an annual audit process for profit share, instead focusing on its current and future procurement strategies for dispersed asylum accommodation and engagement with local authorities.
Summary of the government's response below — read the verbatim text to verify.
Government Response
Deferred
HM Government · verbatim extract
Deferred
Each contract has a Profit Share clause, which obligates the provider to share details with the Home Office to establish whether the threshold for profit has been achieved. On conclusion of each contractual year, the Commercial Contract Management team will investigate retrospective data to establish value of return. As of 4 November 2025, the Home Office has been in receipt of profit share credit notes to the value of £45.9m from the providers. CRH has returned the full £33m. Mears has returned £12.9m and discussions are ongoing about a remaining £3.7m. There is no profit share due back from Serco. The outcome of the annual profit-share audit process, including confirmation of any excess profits recouped from providers, will be reported through the Department’s annual accounts This circular approach would limit our ability to ultimately procure the levels of Dispersal Accommodation required to exit contingency accommodation and in line with standard practice.
Read the full response on Parliament ↗