The Home Office has axed its £2bn contract with Stay Belvedere Hotels following a damning review of the company’s performance in housing asylum seekers. The termination, set for September 2025 – the earliest possible exit point without penalty – marks a significant shift in the government’s approach to migrant accommodation.
Fifty-one hotels across England and Wales currently housing asylum seekers under the contract will gradually be returned to normal use, though ministers face questions about where displaced occupants will be relocated. The decision follows mounting pressure over both costs – with hotel stays costing taxpayers an average of £8 million daily – and conditions at some facilities.
Border Security Minister Dame Angela Eagle emphasised tightened oversight of accommodation providers, warning the government “will not hesitate to take further action” against underperforming contractors. The move comes as:
• Hotel usage for asylum seekers has already fallen by 32% since September 2023
• The controversial Napier Barracks site will revert to MoD control this September
• Labour’s manifesto pledge to end hotel use entirely remains without a clear timeline
The cancellation coincides with reported early-stage discussions about establishing offshore processing centres for failed asylum claimants, including Channel crossers. While officials stress these talks are preliminary, the dual developments suggest ministers are pursuing both immediate cost savings and longer-term structural reforms to the asylum system.
Critics argue the delayed 2025 termination date reveals contractual inflexibility, while migrant advocates warn of potential disruption to vulnerable individuals. The Home Office maintains it’s implementing “robust plans” to ensure a smooth transition, though concrete details about alternative accommodation remain scarce.
