Labour given bombshell warning over migrant hotel and cash support – ‘not far enough’

Home Secretary Shabana Mahmood is preparing to scrap certain European rules that currently mean people arriving in the UK can automatically receive support. The government wants to replace that system with a stricter one where help is no longer guaranteed but depends on behaviour and need.

Under the new plan, which is expected to begin in June, support will become conditional. This means people seeking asylum will only receive financial help and accommodation if they genuinely need it and if they follow the rules set by the government. The idea is to move away from a system where support is given by default and instead make it something that must be earned through compliance.

One of the biggest changes is that migrants who are caught working illegally could lose access to taxpayer-funded housing. This includes hotels, shared houses, flats, and bedsits that are currently being used to house asylum seekers. The same rule will apply to foreign criminals and to people who refuse to leave the UK when they are told to do so. In simple terms, anyone who breaks the rules risks losing the support they are receiving.

Government officials believe this tougher approach could act as a warning to others who may be thinking about coming to the UK to claim asylum while planning to work illegally. By making the system stricter, they hope fewer people will try to take advantage of it.

However, not everyone agrees that these changes will make a real difference. Shadow Home Office Minister Katie Lam argued that while it is right to expect people to follow the rules, the government’s plan does not go far enough to fix the deeper issues within the asylum system.

She explained that people who come to the UK to seek asylum should respect the laws and processes in place. But she also warned that without bigger legal changes, these new measures are unlikely to stop people from entering the country illegally or making false claims. In her view, the system still has loopholes that these reforms do not fully address.

Katie Lam also pointed to official data showing that illegal working among asylum seekers appears to be quite low, making up just 0.3% of those receiving support. That is roughly one person out of every 333. While she acknowledged that the real number could be higher than reported, she stressed that focusing only on this issue will not solve the wider problem.

Her main argument is that small policy changes will not create a strong enough deterrent. Instead, she believes the UK needs a complete rethink of how asylum is handled, including clearer rules, stronger enforcement, and a system that removes incentives for people to misuse it.

At the same time, the scale of the issue is significant. Latest figures show that around 107,003 people are currently receiving support paid for by taxpayers. Out of these, about 30,657 are living in dedicated asylum accommodation such as hotels. The rest are spread across different types of housing in communities across the country.

A large number, 68,538 people, are now living in what is known as dispersal accommodation, which includes houses, flats, and bedsits. This number has increased in just a few months, highlighting the growing pressure on the system and the rising cost to the public.

Asylum minister Alex Norris defended the government’s approach, saying the changes are necessary to keep the system working properly. He argued that without reform, the system could struggle to cope with future demand.

He explained that the goal is to create a balance. On one hand, the system should remain fair and supportive to people who truly need protection and who follow the rules. On the other hand, it must be firm with those who break the rules or try to abuse the system.

According to him, these reforms are also about maintaining public confidence. Many people feel frustrated about how the asylum system currently operates, especially with rising costs and increasing numbers. By tightening the rules, the government hopes to show that it is taking control and using public money responsibly.