Asylum-seeker accommodation in UK to cost €1.2bn next year

Key Takeaways

• UK will spend €1.2bn on asylum-seeker accommodation in 2025, averaging €100 per head per night.
• 38,000 asylum seekers housed in hotels, which cost ten times more per night than dispersal housing.
• UK relies on private contractors for hotels, causing high costs and limited government oversight compared to France and Germany.

The cost of providing accommodation for asylum seekers in the United Kingdom 🇬🇧 has risen greatly in recent years, reaching levels that have put historic strain on government budgets and raised lively debates about the country’s asylum policies. The projected annual bill for asylum-seeker accommodation in 2025 will reach about €1.2 billion (which is roughly £1.03 billion at today’s exchange rates). To help readers understand the scale, causes, and impact of this spending, this analysis reviews the facts, looks at where the money goes, and compares the UK 🇬🇧 approach to other European countries. The focus is on clear, accessible explanations so that anyone—no matter their background—can understand what’s at stake.

Summary of Key Findings

• The UK 🇬🇧 will spend around €1.2bn this year on asylum-seeker accommodation.
• The average cost is €100 per head per night, or more than €36,000 per person each year, up from €33,000 last year.
• Most of this money goes to hotel stays, which cost much more than traditional housing.
• About 38,000 asylum seekers were living in hotels at the end of 2024.
• The number of people supported under the system has more than doubled since 2019/20, now reaching over 114,000.
• The UK 🇬🇧 uses commercial hotels for asylum seekers more than any other European country, while places like France 🇫🇷 and Germany 🇩🇪 prefer state-run or charity-run accommodation, which is usually cheaper.
• Private contract companies provide most of the UK’s asylum housing and can charge higher prices, partly due to the lack of competition and government alternatives.
• Oversight problems and the lack of cheaper options have made it hard for the government to control costs.

The Basic Numbers: How Much Does the UK 🇬🇧 Spend?

The UK 🇬🇧 government’s spending to house asylum seekers is now at its highest level ever. According to reports, the cost for 2025 is projected to be €1.2bn, which works out to about €100 per head per night spent on accommodation and related support. Annually, this means an average of more than €36,000 for every asylum seeker staying in government-provided lodging.

Table: Average Costs

Table based on figures from migrationobservatory.ox.ac.uk and news reports.

Where Does the Money Go?

Almost all of the spending growth comes from using hotels to house asylum seekers. The UK 🇬🇧 government has had to rely on hotels due to a severe lack of typical housing for new arrivals. Normal housing includes shared flats, council homes, or reception centres, but there have not been enough of these. This pressure led the Home Office to book thousands of hotel rooms every night.

Sample Costs per Night

• Hotel room: Up to £145 (about €167) per night.
• Dispersal housing or shared flat: Roughly £14 (about €16) per night.

Using hotels, therefore, costs about ten times more per person each night than traditional accommodation types. This huge price gap is the single biggest driver behind the rising €1.2bn yearly bill and the €100 per head per night average.

How Many Asylum Seekers Need Accommodation?

The number of people the UK 🇬🇧 supports with accommodation and help has risen sharply in recent years:

• In 2019/20: About 51,000 were receiving support.
• By late 2024: More than 114,000 were in the system.
• In December 2024: About 38,000 were being put up in hotels.

This growth adds direct pressure to public spending, as every person needing accommodation pulls from the same budget—one that stretches further as the need for expensive hotels increases.

How Does the UK 🇬🇧 Compare to France 🇫🇷, Germany 🇩🇪, and Others?

Unlike the UK 🇬🇧, most European countries make little or no use of hotels. They prefer:

• State-run reception centres
• Supervised shelter run by charities or NGOs
• Apartments loaned by local councils

For example, both France 🇫🇷 and Germany 🇩🇪 keep costs down by limiting the use of private providers and focusing on longer-term solutions. This leads to lower per-person costs in those countries compared to the UK’s hotel-driven system. Most European states keep commercial hotel contracts as a very last resort. In the UK 🇬🇧, however, hotels have become the main way to provide new arrivals with a bed, especially once traditional options filled up or could not be set up fast enough for a growing population of applicants.

Why Are Hotels So Expensive as Asylum-Seeker Accommodation?

Hotels involve much higher running costs than ordinary flats or shared houses. Rooms are booked at commercial rates, and providers charge the government for the flexibility, service, and full-time management. Costs also rise quickly when availability is tight or when only a few companies are able to offer suitable hotels at short notice. As a result, the Home Office often pays rates that are far greater than standard rents.

Another key factor comes from the way private companies control access to these beds. Just a few large firms currently win most of the accommodation contracts. With so little competition, these companies can keep prices high, increasing the overall per-night and per-year cost for the government.

Oversight and Management Challenges

A report quoted in The Independent summed up a clear concern: “There has also been a ‘glaring lack of effective oversight’…the lack of viable alternatives severely limit the Home Office’s ability to address underperformance.” This means not only is the system expensive, but also lacks strong checks and balances to make sure taxpayers get fair value for the money spent.

The Home Office, which is responsible for managing the system, has said that it cannot easily control prices while there are so few options and such high demand. Without room to negotiate or punish poor performance, it is hard to force better deals or cut wasteful payments.

Projected Trends and Future Challenges

If nothing changes, these high levels of spending may continue, or even rise, in the future. Analysis from VisaVerge.com suggests that unless new forms of affordable and long-term accommodation become available, reliance on hotels will remain strong. It is possible that the average cost could rise above €100 per head per night in coming years if arrivals stay high and alternative options do not grow fast enough.

Some have suggested reforms such as expanding public housing, building new reception centres, or encouraging more local councils to offer placements. There is also talk of limiting private contract holders’ ability to set prices. However, turning these ideas into practice will take time, money, and strong policy changes.

Statistical Review and Trend Analysis

The key statistic—€1.2bn in 2025, with an average cost of €100 per head per night—represents both unprecedented overall spending and a sharp jump in cost per individual.

Chart Description

Imagine a simple line graph that shows annual asylum-seeker accommodation costs from 2019 to 2025:

• The curve sits low between 2019 and 2021, then climbs very steeply from 2022 onward.
• The per-person cost line shows a similar jump, especially after 2020 when hotels begin to be used more widely.

This visual would make clear that hotel use is strongly tied to the sharpest rises in cost.

Number of People in Hotels Over Time

Another bar graph would show that, in 2020, fewer than 10,000 people lived in hotels, but by 2024, almost 40,000 did. This supports the connection between higher hotel use and the much bigger government bills each year.

Changes in Daily Cost

An average hotel room for an asylum seeker cost around £60 in 2021, but by the start of 2024, the same room might cost £132 (about €150). This doubling of cost in just three years puts even more pressure on total spending.

Limitations of the Data

The main numbers come from UK Home Office reports and trusted news sources. However, exact figures can shift depending on how the government counts certain types of support, how often it changes contracts, and which exchange rates are used at the time. Some numbers are “average” costs, meaning that for some people the government spends more, and for others less, depending on where and how they are being housed. Also, there may be hidden costs not included in the top-line figures, such as local council expenses or other forms of support.

Implications for Policy and Society

Spending €1.2bn, or €100 per head per night, has put the asylum process under close public and political attention.

• For taxpayers: The public is paying more than ever to house asylum seekers, which can create debates about other public needs such as schools, healthcare, and housing for local residents.
• For asylum seekers: Long hotel stays often mean little privacy, overcrowding, and limited access to support services. People may have to wait months or even years in this kind of temporary situation before a decision on their case.
• For government policy: High costs are likely to increase political calls for faster decision-making, a larger supply of affordable housing, and stricter oversight of contracts with private companies.

Comparing Governance Models

In Germany 🇩🇪 and France 🇫🇷, the government is more hands-on in both paying for and managing asylum-seeker accommodation. Local authorities and charities are often involved, keeping not only costs but also profits for private firms lower. The UK 🇬🇧 stands out for its reliance on the market, outsourcing the largest contracts to just a few big players whose profits depend on keeping prices high.

Steps Towards Reform

Government reviewers and outside experts have suggested the following possible solutions:

• Increase traditional dispersal housing by building more or making better use of public property.
• Encourage local councils to offer more places by providing extra funding or other incentives.
• Limit how long asylum seekers spend in hotels and set price caps for contracted providers.
• Create new rules to oversee contractors more closely and punish underperformance.

Progress towards these goals has been slow, but policymakers continue to debate which steps can have the biggest impact on both spending and the quality of support for asylum seekers.

Conclusion and Key Takeaways

In summary, the UK 🇬🇧 spends about €1.2bn a year on asylum-seeker accommodation, with the average set at €100 per head per night. This is mainly due to extraordinary hotel use for tens of thousands of people without enough alternative housing. As more people claim asylum, and as local councils struggle to offer new spaces, hotel bills have driven the nightly, yearly, and total costs higher year after year.

Key points for readers:

• The UK 🇬🇧 model is not the same as France 🇫🇷, Germany 🇩🇪, or most of Europe, largely because of its reliance on hotels and private contractors.
• Most of the cost jump is from the switch to hotels, where per-head rates are ten times higher than for dispersal housing.
• More people need accommodation each year, putting further strain on spending.
• Only a few large companies provide these hotel rooms, making it hard for the government to reduce costs.
• Long-term change may depend on moving away from hotels, building new accommodation, and closer management of contracts.

For a detailed look at government policies and the official data about asylum-seeker accommodation, you can visit the UK Home Office’s asylum accommodation information page. For further context and policy updates, VisaVerge.com remains a trusted source for immigration news and analysis.

By keeping the process transparent and focusing on ways to reduce reliance on expensive hotels, there is hope for lowering public spending while still providing humane support to people seeking protection. The choices the UK 🇬🇧 makes now will have lasting effects on its asylum system, its communities, and its finances for years to come.

Learn Today

Asylum seeker → A person who leaves their country to seek protection in another but whose refugee status has not been determined.
Dispersal housing → Government-provided accommodation such as shared flats or council homes, usually less expensive than hotels for asylum seekers.
Home Office → The UK government department responsible for immigration, including accommodation and support for asylum seekers.
Private contractor → A company hired by the government to provide accommodation, often charging commercial rates due to scarce competition.
Reception centre → A state or charity-run facility offering temporary housing and services to asylum seekers, often used in other European countries.

This Article in a Nutshell

The UK’s annual asylum-seeker accommodation cost will hit €1.2 billion in 2025, mainly due to hotel stays averaging €100 per person each night. Hotels are much costlier than traditional housing, leading to political debate and pressure on government budgets. Alternative approaches in Europe keep costs lower and oversight tighter.
— By VisaVerge.com

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