Migrant housing scandal erupts as ministers set aside £500m to close asylum hotels

Entire streets and flat blocks are being taken over to "exclusively" house asylum seekers, council chiefs have claimed.

Ministers have set aside £500m to invest in a "new, more sustainable accommodation model" as they scramble to close 210 migrant hotels, the Daily Express can reveal.

But Nigel Farage's 12 Reform council chiefs have warned that Home Office asylum accommodation contractors are currently sweeping up properties in "our most deprived communities".

And, in an alarming admission, they claimed "whole blocks of flats or streets of new housing are not available to local people".

Communities in Thanet, Canterbury, Dover and Folkestone have all been hit hardest by this practice, the Daily Express has been told.

The letter to Home Secretary Yvette Cooper, signed by 12 council leaders, states: "The sites that Home Office contractors identify are almost always in the midst of our most deprived communities where property is cheapest and of poor quality (not meeting the standards upheld by Local Authorities), and where pressure on public services is highest due to there already being a mix of vulnerable people with competing needs in the area.

"We are alarmed that landowners and landlords are going directly to the Home Office to market units exclusively for asylum use, ensuring that whole blocks of flats or streets of new housing are not available to local people.

"This is effectively creating a 'them and us' mentality.

"Given how fierce the competition for housing is with new accommodation in short supply, this becomes very divisive and puts our local communities and public services at a disadvantage, whilst pushing up demand and ultimately housing costs."

Some 32,345 asylum seekers are living in hotels, while 66,683 are living in "dispersal accommodation" - houses, flats and bedsits - across the country.

Home Office minister Lord David Hanson revealed how ministers have created a £500 million war chest to move migrants out of hotels and into communities across the UK. They insist this will be "developed in consultation with local authorities".

This "basic" accommodation, under the new cross-Government model, will be "used on a temporary basis" to house asylum seekers waiting for their cases to be processed.

Under one proposal, the Government could pay councils to buy or renovate properties.

Former student accommodation, abandoned care homes, empty tower blocks and converted houses and flats could also be used to house asylum seekers.

Labour wants to close every migrant hotel within four years - but the number being used has increased since the General Election.

Lord Hanson told Lord McCrea, of the Democratic Unionist Party, in a Written Parliamentary Question: "The number of hotels in use is now around half the peak reached under the previous Government, and we will take further action over the rest of this Parliament to end the use of asylum hotels entirely.

"To support that goal, as allocated as part of the Spending Review, the Government will be investing £500 million in a new, more sustainable accommodation model, developed in consultation with local authorities.

"This funding will be delivered by the Ministry of Housing, Communities and Local Government (MHCLG) in partnership with the Home Office and local councils, in order to deliver better outcomes for communities and taxpayers.

"In particular, this fund will support local authorities to make available basic alternative accommodation so that it can be used on a temporary basis to house asylum seekers waiting for their cases to be processed.

"In the longer term, our ambition is that this investment will leave a lasting legacy of housing for local communities and reduce pressure on local housing markets."

Lord Hanson also claims Labour's plans to process more asylum applications will lead to an increase in failed asylum seekers being deported.

He added: "MHCLG and the Home Office are committed to continue working closely with devolved governments and local government to co-design this new model, building on the work undertaken to date.

"We will be writing to local authorities shortly to update them on this new model.

"This new funding will complement ongoing Home Office reforms to the asylum accommodation estate, including pilot schemes to repurpose derelict buildings and to develop other community-led alternatives to the use of hotels."

Officials have admitted the Home Office has paid accommodation providers more amid "challenging market conditions" to help move migrants out of hotels.

In a submission to the Home Affairs Select Committee, the Home Office revealed: "By increasing DA [dispersal accommodation] pricing and the volume caps, this should have given AASC providers greater buying power within the rental market, allowing them to increase capacity.

"However, in practice, DA pricing uplifts have not consistently supported the level of DA capacity growth anticipated."

The Home Office and asylum accommodation providers meet with council chiefs every month to discuss the "procurement" of properties "in line" with plans to house migrants in different communities.

The number of council areas with asylum accommodation has increased over the past year from around 70% to 81%, heaping even more pressure on local housing, schools, the NHS and community cohesion.

Conservative Shadow Home Secretary Chris Philp said: "Council taxes are going through the roof, private housebuilding is plummeting, and 1.3 million people are waiting on social housing lists, and yet Labour has just confessed to spending half a billion pounds of taxpayer money on accommodation for people who shouldn't even be here.

"The Labour Government is laying the foundations for a permanent parallel system that is built to reward illegal immigration funded by the hard-working taxpayer.

"All while British families wait years for a home that is becoming increasingly unaffordable due to mass immigration. Only the Conservatives will end this farce."

A government spokesperson said: "As made clear in the full response to Lord McCrea, this new accommodation model does the exact opposite of what the Express has claimed - it is designed to work more closely with councils to ensure basic, temporary accommodation is available for asylum seekers, reducing pressure on local housing markets and with full consideration of potential impacts on local communities.

"This investment is designed to leave a lasting legacy of housing for local communities and reduce pressure on local housing markets, and any other interpretation of its purpose is completely false.

"In the meantime, this programme will also help us to continue cutting costs to the taxpayer by reducing the use of asylum hotels, and ending their use entirely by the end of this Parliament."