Andy Burnham Is Under Pressure After 50 Groups Sent Him a Letter About Housing for Asylum Seekers, Revealing What They Want Him to Do

Andy Burnham is being urged to bring back a £500 million plan that would allow councils to buy or repair homes for asylum seekers.

Around 50 charities that support refugees and asylum seekers have written to the new Prime Minister. They are asking him to make major changes to what they describe as a costly asylum accommodation system that allows private companies to make large profits.

At present, the Home Office pays billions of pounds to private companies to find and manage temporary accommodation for people seeking asylum. Some councils believe they could provide better and cheaper accommodation if the Government gave them money to buy new properties or repair empty homes.

The proposed £500 million trial scheme would have allowed councils to buy or renovate properties for temporary asylum accommodation. However, government sources said the plan was stopped because of concerns about how much it would cost.

One source said Burnham could still restart the proposal, which was developed last year by the Home Office and the Ministry of Housing, Communities and Local Government.

Some Labour MPs support the idea, but others are worried that it could cause public anger. They fear Reform UK could accuse the Government of putting asylum seekers ahead of British families who are waiting for housing.

One Labour MP said the plan was a good idea in principle but warned that critics would use it to attack the Government.

Supporters of the plan say it would not give asylum seekers permanent council homes or allow them to move ahead of people already waiting for social housing. The properties would only be used as temporary accommodation while asylum claims are being considered.

The plan would allow councils to use some of the money that is currently paid to private companies such as Serco, Mears and Clearsprings.

Around 200 councils are believed to have shown an early interest in joining the scheme. However, several councils said they are still waiting to hear from the Home Office or the housing department.

Bella Sankey, the Labour leader of Brighton and Hove City Council, said she hopes the proposal will be considered again. She described the current private system as wasteful and said councils could use the money to buy new properties or convert buildings that already exist.

She stressed that asylum seekers would not receive permanent council tenancies. Instead, the money currently going to private companies could be invested in properties owned by councils.

If the number of outstanding asylum cases falls in the future, those properties could later become part of the wider council housing supply and be used by other people who need social housing.

Private contractors currently place many asylum seekers in hotels. These hotels have become the focus of protests in several parts of the country. The use of shared houses, known as houses in multiple occupation, has also caused controversy.

The Labour Government has increased the use of former military sites as it tries to reduce the number of asylum seekers living in hotels. Sites including Crowborough and Wethersfield are being managed by Clearsprings.

The Government signed 10-year agreements with Serco, Mears and Clearsprings in 2019. According to a National Audit Office report, the three companies are expected to receive a total of £15.3 billion in taxpayers’ money under the contracts.

Kate Wareing, the chief executive of Soha Housing Association in Oxfordshire, said the £2.1 billion spent on asylum hotels during 2024–25 could have been used by councils and housing associations to buy or renovate around 10,000 homes.

She suggested that councils could buy properties from developers who are struggling to sell homes on new housing estates.

Wareing said the proposal was not about allowing asylum seekers to jump the housing queue. She explained that the homes would provide temporary accommodation and could reduce the large amount of money already being spent on hotels.

Burnham previously said he would consider ending the Government’s expensive contracts with private asylum accommodation companies before they expire in 2029. A clause in the agreements may allow the Government to end them early.

He said he was willing to speak with regional mayors about whether local solutions could improve the current system.

However, any changes may only result in new contracts that give councils and mayors more control over where asylum seekers are placed. The Government may decide not to go as far as giving councils money to buy properties.

In their letter, the charities urged Burnham to be bold and give the public sector more control. They argued that outsourcing asylum accommodation to private companies had created a system that lacked proper public examination and accountability.

Louise Calvey, executive director of Asylum Matters, said it would be very disappointing if the Government refused to continue with the £500 million trial. She called on Burnham to show courage and try a different approach.

Labour MP Kim Johnson said councils should receive the money, powers and control needed to provide accommodation directly.

Bell Ribeiro-Addy, another Labour MP, said the Government should stop private companies from making excessive profits from asylum accommodation. She said a council-led system could provide a better long-term solution.

However, some Labour MPs remain strongly opposed to the proposal. One MP representing a northern “red wall” seat said voters could become even angrier if councils began buying homes to accommodate asylum seekers.

The MP also warned that councils controlled by Reform UK might refuse to take part. This could mean that asylum seekers would be placed mainly in areas controlled by parties supporting the plan.

Another Labour MP said Reform-led and right-wing Conservative councils would probably refuse to join, making the scheme politically difficult.

Jonathan Brash, the Labour MP for Hartlepool, said he would not support councils creating housing for asylum seekers. He argued that councils should instead have the legal right to refuse asylum accommodation in their areas.

The Conservatives have also proposed removing the right of some foreign nationals to access social housing, although people with EU settled status would not be removed from their homes.

Asylum seekers are not normally eligible for social housing. Those who are granted refugee status may later qualify, but they must meet strict legal and local requirements.

A Home Office spokesperson said the Government was working to remove factors that encourage people to enter the UK illegally. The spokesperson promised to close every asylum hotel and move asylum seekers into more basic accommodation, including former military sites.

The Home Office said the number of asylum seekers living in hotels had fallen by 35 per cent over the previous year and that costs had been reduced by £1 billion.

Mears Group said its profit margins were agreed under its government contract and represented value for taxpayers. It also said the accommodation it provides is approved and regularly inspected by the Home Office. Serco and Clearsprings were asked to respond.