MPs slam ‘chaotic and expensive’ asylum-hotel system, urge clear exit strategy by Home Office

A scathing report released in the early hours of 26 October 2025 by Parliament’s Home Affairs Committee accuses the Home Office of lacking a coherent plan to wind down the use of hotels for asylum seekers. The inquiry found projected accommodation costs for 2019-29 have tripled from £4.5 billion to £15.3 billion as small-boat arrivals surged post-pandemic.

While ministers have promised to phase out hotels by 2029, MPs warn that without a concrete timeline and viable alternatives—such as large-scale reception centres or community-sponsored housing—the target will be missed, eroding public trust. The committee also criticised ‘corner-cutting’ procurement that left some sites unfit for purpose and inflamed local opposition.

Business travel and relocation specialists say the hotel backlog indirectly squeezes room availability and drives up prices in regional markets favored by project teams and assignees. "When several hundred rooms are block-booked for asylum contracts, nearby corporate rates spike by 15-20 %," noted one mobility procurement manager.

The report recommends accelerated rollout of purpose-built accommodation, stronger partnership with local councils, and a transparent quarterly progress dashboard. The Home Office said it would "carefully consider" the findings while reiterating its commitment to ending hotel reliance.