Flawed contract design and incompetent delivery left the Home Office unable to cope with the surge in demand for asylum accommodation, a report by the Home Affairs Committee has found.
Hotels went from a temporary stop-gap to the go-to solution for asylum accommodation, leading to a failed system that is expensive, unpopular with local communities and unsuitable for asylum seekers.
As the cost of asylum accommodation contracts more than tripled, inadequate oversight meant failings went unnoticed and unaddressed. The Home Office failed to keep costs down and underutilised mechanisms to penalise providers for poor performance and reclaim excess profits.
No performance penalties are applied for poor performance at Napier, Wethersfield or asylum hotels, despite hotels accounting for over 75% of spending on asylum accommodation.
Break clauses in 2026 and the end of the contracts in 2029 offer the Home Office an opportunity to end the failed system. However, without a clear long-term plan and the institutional capability to deliver a model that is more effective and offers value for money, past failures risk being repeated, the Committee warns.
The Home Office’s approach has been a series of hasty, short-term responses. It must now learn from past failures and deliver a clear long-term strategy for asylum accommodation that provides value for money, adequate standards of accommodation and takes account of the impact on local communities.
Chair of the Home Affairs Committee, Dame Karen Bradley said: “The Home Office has presided over a failing asylum accommodation system that has cost taxpayers billions of pounds.
“Its response to increasing demand has been rushed and chaotic, and the department has neglected the day-to-day management of these contracts. The Government needs to get a grip on the asylum accommodation system in order to bring costs down and hold providers to account for poor performance.
“Urgent action is needed to lower the cost of asylum accommodation and address the concerns of local communities. While reducing hotel use is rightly a Government priority, there will always be a need for flexibility within the system, and the Home Office risks boxing itself in by making undeliverable promises to appeal to popular sentiment. It shouldn’t set itself up for more failure.
“The Home Office has not proved able to develop a long term strategy for the delivery of asylum accommodation. It has instead focused on short term, reactive responses.
“There is now an opportunity to draw a line under the current failed, chaotic and expensive system, but the Home Office must finally learn from its previous mistakes or it is doomed to repeat them.”
People with lived experience of homelessness are uniting with dozens of leading organisations to demand urgent action on Scotland’s worsening housing crisis.
Their joint manifesto will be launched today at Scotland’s Annual Homelessness Conference, hosted by Homeless Network Scotland, on 27 and 28 October in Perth.
It calls on all political parties to commit to a programme of housing justice that will ensure everyone in Scotland has a safe, secure place to call home.
The scale of the crisis has been laid bare in recent statistics, with more than 17,200 households currently trapped in temporary accommodation, a 6% increase in one year, including over 10,000 children.
Nearly 250,000 people are on waiting lists for a social home, and 40,688 households have applied to their local council for help with homelessness last year. On average, those in temporary accommodation wait 238 days for a settled home.
The call comes from members of Everyone Home, a collective of nearly 40 third and academic sector organisations focused on ending homelessness, and All In for Change, a platform that unites lived experience and practitioner insight of homelessness across Scotland to enable decision-makers to drive real change.
All in for Change said: “In the Change Team, we see every day how the housing emergency hurts people who are homeless and those trying to help them. Frontline workers do amazing work, but they’re trapped in a broken system with too little housing and support to fix it.
“Some of us have been homeless ourselves, so we know the reality first-hand. But we believe this can be made better for others, with real political commitment and funding being used more wisely.
“We’ve laid out clear expectations for party manifestos, and we’ll keep pushing to shield people from the worst of homelessness in this housing emergency.”
Set almost 18 months after Scotland’s housing emergency was formally declared, the manifesto outlines a practical, values-led approach to resolving a crisis that continues to deepen inequality and exclusion.
It sets out five priority actions for the next Scottish Government, under the banner of SCALE. It calls for the launch of a national ‘Big Build’ programme to dramatically increase the supply of social housing, with a target of nearly 16,000 new homes each year of the next parliament backed by at least £8.8bn.
The manifesto urges political leaders to coordinate support services more effectively, so that housing is fully integrated with health, social care and justice to ensure no-one falls through the cracks.
It demands that public funding decisions align with housing priorities, including the use of tax powers and long-term investment plans that can give frontline workers and those they support greater certainty.
It insists that housing rights must be protected and fully resourced, warning that too many local authorities are currently struggling to meet their legal obligations.
Finally, it calls for fast-track housing and support for groups facing systemic exclusion, including people affected by poverty, discrimination, trauma, gender-based violence and UK immigration policy.
Maggie Brünjes, chief executive, Homeless Network Scotland, said: “Scotland’s housing emergency is a plan gone wrong, driving homelessness and deepening inequality. To reverse this, we must invest in more social housing, higher incomes, proactive prevention and support that is fully integrated across health, housing, justice and social care.
“The Everyone Home collective manifesto is a plan to put that right and a call for Housing Justice. Combining first-hand, professional and academic insight, the manifesto outlines real-world measures to reduce inefficient spending, prevent the worst harm among the worst off, and scale solutions for a Scotland where everyone has a home.”
The manifesto launch will take place at Scotland’s Annual Homelessness Conference, this year titled ‘It’s Personal: the human face of the housing emergency’.
The two-day event will shine a light on the real-world, human impact of the crisis, through people with lived experience, advocates and experts sharing knowledge and practical ideas to deliver lasting change.
Helen Murdoch, Asst. Director of Strategic Operations & Development (Scotland) at conference delivery partner The Salvation Army, said: “This year’s conference takes place in the shadow of a housing and homelessness crisis that tests our compassion, our resources and our collective resolve.
“The demand for services that support people experiencing homelessness is far outstripping supply – that must change and change quickly. Conference is an opportunity to explore our role in bringing about that change and The Salvation Army is proud to be an event partner.
“It is also a time to look beyond the headlines and statistics, to recognise and celebrate the extraordinary courage and resilience of teams working in communities, the third sector, local authorities and religious bodies to support people experiencing homelessness.”
Keynote speakers include Cabinet Secretary for Housing, Màiri McAllan MSP, who will address the event, renowned children’s rights campaigner and author Baroness Floella Benjamin, and rising social justice advocate Eireann McAuley, named one of the Young Women’s Movement’s ‘30 under 30′.
Baroness Floella Benjamin OM DBE said: “Having a safe and secure home is the key building block for living a happy and fulfilling life, yet today that basic human need is being denied to too many people. The impact on them is heartbreaking.
“All it takes is the grit, perseverance and determination to face the challenges and to keep on pushing for positive change. There is no shortage of people willing to fight this fight and I support all those who are working to change people’s lives.
“When I address Scotland’s annual homelessness conference I hope to energise and inspire the audience, to bring them joy amid the struggle. I want to remind people that even though it sometimes doesn’t feel like it, the work they do every day can and does change lives. So never give up.”
The launch marks the start of a national conversation aimed at ensuring housing and homelessness are top-tier priorities ahead of the 2026 election.
