Recommendation 18

The contract for the Northeye acquisition contained conditions that meant that the longer it took the Home Office to complete the purchase beyond a six–week timeframe, the more money it would pay. The National Audit Office reported that despite these terms being questioned by some of the Home Office’s advisers, those leading the purchase felt that the terms would never be enacted. Once contracts were exchanged, there was little scope for the Home Office to withdraw from the agreement without heavy financial penalties. 53 During our evidence session, the Home Office explained that the inclusion of specific contract conditions stemmed from a lack of necessary expertise within its property function at that time. It acknowledged that it lacked the capability to assess the agreed terms properly.54 When challenged on why it entered into the contract without fully understanding its implications, the Home Office again justified this approach because there was “significant pressure to secure” the acquisition.55 It told us that it “judged it the right thing” to go ahead with the purchase due to “overriding requirement for pace”.56 The Home Office told us that its current strategy is shifting towards using smaller asylum accommodation sites, and asserted it is unlikely to pursue large acquisitions like Scampton, Wethersfield or Northeye again.57 We asked for assurance that it would not make similar mistakes again, and the Home Office reiterated that it had learned lessons. While the Home Office acknowledged its mistakes and said that it “definitely rushed into the acquisition”, it highlighted efforts to strengthen its property expertise.58 If the Government decides to resell the site, we are anxious that the previous mistakes are not repeated and that a realistic sale price in line with the market is achieved. 52 Q 93 53 C&AG’s Report, para 1.12 54 Q 61 55 Q 64 56 Q 76 57 Qq 49, 51 58 Q 65 16 2 Learning lessons and controlling costs Home Office culture