Home Office Reports Sharp Drop in Asylum Hotel Use as MPs Question Tracking of Failed Claimants

The Home Office has reduced the number of asylum seekers housed in hotels from a peak of 56,042 in September 2023 to 20,885 as of March 2026, according to a Public Accounts Committee report published on Friday. More people are now living in dispersal accommodation such as houses of multiple occupancy, and the government is using large sites such as former military bases for additional housing.

The committee report states that the department does not know exactly how many failed asylum seekers it has lost contact with. Home Office officials told the committee they know where the vast majority of failed asylum seekers are, but that others are not complying with bail conditions and are treated as absconders.

Officials said they do not count absolutely everybody out of the country and therefore do not know precisely who has left or who remains. Ministers admitted in 2024 that more than 5,000 failed asylum seekers were missing. As of that year, 5,598 asylum seekers whose claims had been withdrawn were still in the UK but had lost contact with the Home Office.

The Public Accounts Committee examined the department’s handling of asylum accommodation contracts. The Home Office clawed back £46 million of excess profit from providers last year. The National Audit Office has previously reported that hotel spending reached £1 billion. The committee said this highlighted weaknesses in the original contract design.

The report said there is no credible long-term strategy to expand dispersal accommodation and warned against plans to scale up larger sites. It noted that increasing numbers of people are presenting as homeless to councils after being evicted from Home Office accommodation.

The committee also said that accommodation previously deemed unfit to house asylum seekers is now being considered as part of plans to increase the UK’s housing stock. A former prison site in Bexhill, East Sussex, was earmarked for migrant accommodation but will now be redeveloped for housing by Homes England in partnership with the council and local community.

Sir Geoffrey Clifton-Brown, chair of the Public Accounts Committee, said the committee’s findings paint a disturbing picture and described the situation regarding lost contact with failed asylum seekers as a shocking and unacceptable state of affairs.

He said it is indefensible that accommodation deemed unfit to house asylum seekers is now being looked at as part of plans to increase the UK’s housing stock.

Chris Philp, the shadow home secretary, said over 73,000 illegal immigrants have crossed the Channel under this Labour government.

A Home Office spokesperson said the department has tracked down and removed nearly 70,000 illegal migrants and foreign criminals since the government took office and that immigration enforcement activity is at the highest level on record. The spokesperson added that asylum claims are down and hotel use is falling.

Any asylum seekers who break their bail conditions by absconding will be tracked down and arrested, the spokesperson said.