Asylum hotel costs have risen by more than a third (Image: Getty)
Andy Burnham has faced scrutiny over the Government’s pledge to end the use of asylum hotels, with the latest figures showing the average cost per person has risen despite the number of hotel residents falling.
The cost of housing asylum seekers in hotels has surged by more than a third despite the Government’s pledge to end their use, with taxpayers now spending an average of £199 per person per night.
Get the day’s biggest headlines in UK and World news and more
Invalid email
You agree you are 18 or over. We use your sign-up to provide content in ways you’ve consented to and to improve our understanding of you. This may include adverts from us and third parties based on our knowledge of you. You can unsubscribe at any time. More Info.
Figures from the Home Office show the average cost is up 37% cent from the £144.98 figure provided by the department last October.
The latest cost works out at around £1,393 per person a week (Image: Getty)
That works out at around £1,393 per person every week, adding to pressure on ministers over the cost of asylum accommodation.
The increase comes as the Government continues its programme of closing asylum hotels. Home Office Minister Anna Turley told the Home Affairs Committee that the higher average cost was partly due to hotels being shut in phases.
She said that as occupancy falls ahead of a hotel’s full closure, the department can still be paying for unoccupied rooms, pushing up the average cost per person remaining.
The number of people housed in asylum hotels has nevertheless fallen sharply.
Some 16,021 people remained in hotels at the end of June, according to the figures provided, compared with 36,273 at the end of September last year.
The number of hotels in use also fell from 200 at the end of September to 160 by the end of June.
The Government has committed to ending the use of asylum hotels by the end of this Parliament, with ministers moving people into alternative accommodation including former military sites.
Alternative accommodation is considerably cheaper than hotels, with rented “dispersal” accommodation, including houses in multiple occupation, costing around £25 per person per night.
The latest figures mean the Government is reducing the number of people in hotels while the average cost of housing those who remain has increased.
The Home Office said: “The Government is closing every asylum hotel, saving taxpayers over £1billion on asylum support since the election.
“Numbers in asylum hotels have been slashed by 50 per cent in the last year and 71 per cent since the peak in September 2023.
“We are working to fairly house asylum seekers across the country, moving asylum seekers into alternative accommodation, including former military sites which are designed to be self-contained to reduce impact on the local community.”
The issue has become politically sensitive for Labour, which has pledged to end hotel use entirely.
The figures emerged amid criticism over plans to exempt taxpayer-funded asylum accommodation from a new overnight visitor levy.
Regional mayors are being given powers to impose the levy on stays in hotels, B&Bs and holiday lets across England, but asylum accommodation will be exempt because it is classed as temporary accommodation.
Beyond hotels, another 73,068 asylum seekers were being housed in other forms of taxpayer-funded accommodation at the end of June.
Andy Burnham Under Pressure as Cost of Asylum Hotels Surges by More Than a Third
Andy Burnham is facing renewed political pressure over the cost of asylum accommodation after Home Office figures showed that the average amount being spent on asylum seekers housed in hotels has risen by more than a third.
The figures show a striking contrast. The government has substantially reduced the number of asylum seekers living in hotels, yet the average cost per person has increased.
According to the latest figures reported from the Home Office, the average cost has reached £199 per person per night, up 37% from £144.98 reported by the department last October. That equates to approximately £1,393 per person per week.
The increase has prompted fresh questions about the government’s pledge to end the use of asylum hotels entirely.
However, the figures also need context. The government says the higher average cost is partly a consequence of closing hotels in stages, meaning some rooms continue to be paid for while occupancy falls before a site closes completely.
The headline figure
The £199-a-night figure has quickly become the focus of criticism.
Compared with the previous £144.98 average, the increase is substantial. But it does not mean that every asylum seeker is individually costing taxpayers £199 every night in accommodation.
The figure is an average across the hotel estate and can be affected by occupancy levels, contracts, hotel closures and the mix of accommodation being used.
Home Office Minister Anna Turley told the Home Affairs Committee that hotels were being closed in phases and that the department could continue paying for rooms that were not occupied during the final stages of a hotel’s operation.
That means the average cost per person can rise even while the overall number of people being housed in hotels falls.
This distinction is important when assessing what the latest numbers actually demonstrate.
Hotel numbers have fallen sharply
The government’s strongest defence is that the hotel system is considerably smaller than it was at its peak.
At the end of June 2026, 16,021 asylum seekers were housed in hotels, compared with 36,273 at the end of September 2025, according to figures reported from the Home Office.
The number of hotels being used also fell from around 200 to 160 over the same period.
ITV News separately reported that the June figure represented a 50% year-on-year reduction and was the lowest number recorded since the Home Office began publishing comparable hotel data in 2022. The number had previously reached 56,018 in September 2023.
The government therefore has two contrasting statistics to point to.
The number of people in hotels is falling significantly.
But the average cost per person remaining in those hotels has increased.
Both can be true at the same time.
Why the government is closing hotels
The Labour government has pledged to end the use of hotels for asylum accommodation by the end of the current Parliament.
Ministers argue that hotels are expensive and that taxpayers should not have to continue financing the system indefinitely.
The government has therefore been moving asylum seekers into alternative accommodation, including rented properties and former military sites.
The difference in cost can be considerable.
The latest figures indicate that rented dispersal accommodation, including houses in multiple occupation, costs around £25 per person per night, substantially below the reported hotel average.
That cost differential explains why ministers are keen to accelerate the closure programme.
If people can be housed appropriately in substantially cheaper accommodation, moving away from hotels could reduce expenditure.
The difficulty is that alternative accommodation has to be found, prepared and managed.
Burnham inherits the problem
The issue also carries political significance for Burnham because he became prime minister after the hotel system had already been operating for several years.
The government that he inherited had already begun reducing hotel numbers.
ITV reported that Burnham retained Shabana Mahmood as Home Secretary after becoming prime minister, allowing her to continue the migration strategy already being pursued by the Labour government.
The political argument is therefore not simply about a new policy introduced by Burnham.
It concerns whether his government can complete a programme that Labour has made a central commitment: ending the use of hotels for asylum accommodation.
The £1 billion claim
The Home Office has argued that the government is already saving taxpayers significant amounts of money.
A departmental statement said it had saved more than £1 billion on asylum support since the election, while the number of people in asylum hotels had been reduced by 50% over the previous year and by 71% from the September 2023 peak.
These figures provide an important counterpoint to the increase in average hotel costs.
The government is not claiming that costs are falling in every individual category.
Instead, its argument is that the overall system is becoming smaller and that closing hotels will eventually generate further savings.
The success of that strategy will therefore depend on how quickly the remaining hotels can be closed and whether replacement accommodation really is available at lower cost.
Why the average cost can rise while spending falls
The apparent contradiction is easier to understand with a simple example.
Imagine a hotel with 100 rooms.
If all 100 rooms are occupied, the cost of the hotel is spread across 100 residents.
If the number of residents falls to 30 while the government remains committed to the hotel contract for a period before closure, many of the fixed costs remain.
The cost per person consequently rises.
That appears to be what ministers are describing in the current figures.
The government is effectively in the expensive final stages of reducing a large accommodation system.
That does not necessarily mean the long-term policy is becoming more expensive.
But it does mean there can be a temporary increase in the cost per person while hotels are being wound down.
The wider asylum bill
Hotel accommodation is only one component of the government’s asylum expenditure.
At the end of June, another 73,068 asylum seekers were living in other forms of taxpayer-funded accommodation, according to the figures reported by AOL.
ITV reported that total government spending on asylum fell by 8% in 2025-26, from £4.76 billion to £4.36 billion. Spending had previously reached £5.38 billion in 2023-24.
This broader figure matters because focusing exclusively on the hotel average gives only part of the financial picture.
The government is dealing with accommodation, asylum applications, processing, legal cases, returns, enforcement and other associated costs.
The overall bill can therefore rise or fall independently of the average hotel rate.
The political criticism
Opposition parties are likely to use the latest figures to question Labour’s management of asylum accommodation.
The argument is straightforward: taxpayers are being asked to pay almost £200 a night for some asylum accommodation even as the government promises that hotels will soon disappear.
Critics can reasonably ask why costs have risen so sharply and whether contracts are being closed quickly enough.
There is also a political argument about priorities.
If cheaper accommodation exists, critics may question why hotels remain open at all.
The government’s response is that the transition cannot happen instantly and that closing hotels requires suitable alternatives.
That explanation does not eliminate the cost issue, but it provides an important reason why the average figure has increased during the closure process.
The tourist-tax controversy
The hotel figures have emerged alongside another controversy over asylum accommodation.
The government recently announced plans allowing English mayors to introduce overnight visitor levies on hotels, holiday lets and bed-and-breakfast accommodation.
However, taxpayer-funded asylum hotels are expected to be exempt because they are classified as temporary accommodation.
That exemption has attracted criticism from opposition politicians and parts of the hospitality industry.
The criticism is based on the argument that ordinary hotel guests and businesses could face an additional charge while asylum accommodation does not.
The government, however, says asylum accommodation has a different legal and administrative status from ordinary tourism.
The dispute adds another layer to the broader argument over the financial treatment of asylum hotels.
What happens next?
The government’s long-term objective is clear: close every asylum hotel by the end of the Parliament.
The challenge is delivering that objective without creating new accommodation shortages or simply transferring costs elsewhere.
If more asylum seekers can be moved into cheaper rented accommodation or purpose-built facilities, the average cost should eventually fall.
If hotels remain open longer than planned, however, the government could face continued pressure over expensive contracts.
The latest figures therefore represent a snapshot during a transition rather than a final assessment of the policy.
A politically awkward set of figures
The increase to £199 per person per night is undeniably significant.
But describing it simply as evidence that the government’s entire asylum strategy is failing would overlook the other side of the data.
The number of people in hotels has fallen dramatically. The number of hotels has also fallen. Overall asylum spending has declined, according to Home Office figures reported by ITV.
At the same time, the average cost of accommodating those who remain in hotels has increased substantially.
That is the central tension facing Burnham’s government.
Ministers can point to a rapidly shrinking hotel system, while critics can point to the rising price of maintaining the remaining accommodation.
The decisive measure will ultimately be whether the government can complete the transition to cheaper alternatives and eliminate hotel use altogether.
Until that happens, the £199-a-night figure is likely to remain politically damaging for Labour, while the government’s defence will rest on the explanation that hotel closures themselves are temporarily distorting the average.
The numbers tell a more complicated story than either side’s political rhetoric.
The hotel system is shrinking, but the cost of the remaining system is rising.
For Burnham, the task now is to turn that temporary contradiction into a lasting reduction in both hotel use and the overall cost of asylum accommodation.