The National Audit Office said the Home Office now expects to spend £1.2-billion on its “large sites” programme, which will see asylum seekers placed on the Bibby Stockholm barge berthed at a port in Dorset, on former Royal Air Force bases in Lincolnshire and Essex, and in former student accommodation in Huddersfield, West Yorkshire. 

That’s £46-million more than it would have cost to keep them housed in hotels over the expected lifetime of those sites, the NAO said in a report published on Wednesday.

The government spent £2.3-billion on accommodating asylum seekers in hotels in the 2022-23 financial year, and expects to spend £3.1-billion in 2023-24. As part of a plan to cut costs, it began exploring other large developments in which to house a portion of those people, and initially thought the four sites would be a cheaper alternative.

But those calculations included the assumptions that the RAF sites at Scampton and Wethersfield would each cost £5-million to develop. The Home Office now thinks the development costs are more like £27-million and £49-million respectively.

The NAO findings are another blow to Rishi Sunak, whose ruling Conservative Party is lagging Labour in opinion polls ahead of a general election expected in the autumn. Sunak has vowed to stop the small boats bringing migrants across the English Channel from France, and while the numbers have fallen year-on-year, tens of thousands of people are still making the journey every year.

Gareth Davies, head of the NAO, said the pace at which the government had pursued its plans to reduce reliance on hotels had “led to increased risks.”

“The Home Office continued this programme despite repeated external and internal assessments that it could not be delivered as planned,” he said, adding that plans to “reset” the large sites program, and instead look at smaller sites, “makes sense”.

Labour MP Meg Hillier, chair of the House of Commons Public Accounts Committee, said the Home Office “did not understand the challenges it faced in setting up large sites and moved too quickly, incurring losses, increasing risks and upsetting local communities.” 

“The sites are housing fewer people than planned,” she said. “The Home Office must do better when it resets its programme and provide safe and suitable accommodation for asylum seekers at the best value for taxpayers’ money.”

In 2023, the UK received 67,300 asylum applications — almost double the number in 2019. It has failed to keep up with processing those claims, leading to a backlog of 95,300 claims representing 128,800 people as of the end of December.