Source · Select Committees · Home Affairs Committee
Recommendation 42
42
Acknowledged
Home Office lacks clear strategy for sustainable asylum accommodation system
Conclusion
The 2026 break clause and the end of the contracts in 2029 represent an opportunity to draw a line under the current failed, chaotic and expensive system and move to a model that is more effective and offers value for money. While the Home Office is considering options, it has not yet shared a clear strategy for the delivery of a sustainable accommodation system. Moreover, there has been little clarity from ministers even regarding the basis on which they will make a decision on using the break clause. There is a serious risk that if the Home Office does not expedite the development of a long-term strategy for the future delivery of asylum accommodation, when it is time to replace the current contracts the department will find itself in a similar position to that of 2019, with limited choices as to how it secures accommodation. (Conclusion, Paragraph 186) 106
Government response summary AI-generated
The Home Office states that exiting asylum hotels is a top priority, with significant progress already made, and commits to ending hotel use by the end of the current Parliament. It is reviewing its long-term accommodation strategy in light of recent policy statements and is working with other departments to deliver a more flexible estate, including military sites.
Summary of the government's response below — read the verbatim text to verify.
Government Response
Acknowledged
HM Government · verbatim extract
Acknowledged
The Home Office recognises that hotels became a significant part of the asylum accommodation system due to unprecedented demand and limited contractual flexibility. As part of the Government’s ‘Restoring Order and Control’ programme, the Home Office will design a future asylum accommodation system that responds to fluctuations in demand, safeguards vulnerable asylum seekers and minimises the impact on local communities. In the near-term, this Government is committed to exiting the use of asylum hotels as soon as possible by progressing alternative accommodation initiatives and working collaboratively with other government departments to deliver a range of suitable alternative sites to hotels, including former military sites. We are working with providers to deliver more Dispersal Accommodation bedspaces and move away from their reliance on hotels as Contingency Accommodation. Hotel use has already reduced substantially – from over 400 at its peak, to 197 in use as of 5 January 2026 – but this government remains committed to exit all asylum hotels as soon as possible. In the longer term, the Government continues to explore options for stable and sustainable accommodation models. These models aim to reduce pressure on local housing markets, improve resilience in the asylum system, and ensure that accommodation solutions are fit for purpose and adaptable to future needs. The 2026 break clause pertains to the core contract that provides Initial and Dispersed Accommodation. Hotels can be exited without exercising these break clauses as they are contracted via a Contract Change Notice to the main contract. To exercise the break clause on the core contract, there needs to be sufficient alternative supply of accommodation in place to ensure service continuity. The break clause can be enacted at any point between 2026 and 2029. Lessons have been learned from the mistakes of the past. The Home Office will review these lessons and ensure they are used to design future contracts that are flexible and better able to respond to changing demand, while ensuring value for money for the taxpayer.
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