The UK is spending 40% a person more than any other European country on housing asylum seekers with the costs taking up nearly a third of the official aid budget, which forced a 16.4% cut in the amount of aid spent overseas in 2022.
The findings come in a report by One, the aid campaign, which argues the proportion of the aid budget being spent on housing refugees in the UK is totally out of sync with its neighbours and is making the British aid budget both unpredictable and unmanageable
The development minister, Andrew Mitchell, has publicly complained about the effect of the Home Office raid on the aid budget in the past, but the One report suggests no structural reform has so far been implemented to bring costs under control.
International aid rules allow countries to use the overseas aid budget to cover the first-year costs of refugees including food and accommodation. But each country has flexibility in deciding what costs to load on to the aid budget.
The report finds that in 2022, the UK spent £3.7bn of its aid budget on refugees in the UK, an increase on the £1.1bn spent in 2021. This rise is not solely because of an increase in the number of Ukrainian refugees, but also the result of a 400% increase in asylum applicants since December 2017 and a growing backlog of asylum claims.
More than half of asylum applicants in the UK are from countries other than Ukraine, such as Syria and Afghanistan. This suggests the damage to the aid budget is likely to be long term without structural reform to the Home Office handling of asylum claims.
The report says if asylum seekers spent 60 days or fewer in hotels, the costs could be cut by £1bn.
In December 2022, 1,237 Home Office caseworkers made an average of just four asylum decisions a month, partly because of a lack of experienced staff. Furthermore in 2021, the UK had 14.9 cases in the asylum backlog for every 10,000 of the population. This is more than France, that had 7.3 cases for every 10,000 people, despite the UK receiving far fewer asylum applications for every 10,000 people – 8.4 compared to France’s 17.9.
The report suggests the financial burden could be reduced by more than £1bn if more asylum applicants were allowed – as is the case with Ukrainian refugees – to be sponsored by private citizens rather than in hotels that on average cost £120 a night. It also says the backlog could be reduced by making clear that applicants from war-torn countries such as Syria are more likely to have their claim accepted, allowing them to work and therefore reducing the burden on the taxpayer.
It also suggests that the UK could ringfence the overseas aid budget at the current 0.5% of GDP, therefore protecting the amount of money that is being spent for its original purpose of alleviating poverty abroad. Some countries such as Sweden have set caps on the percentage of the aid budget spent on domestic refugees.
Romilly Greenhill, the director of One, said: “The Home Office are treating UK aid as a blank cheque, effectively reducing it by a third, which is in nobody’s interest. Their policies are creating a lose-lose situation, which is bad for refugees, bad for people in low- and middle-income countries, and bad for the long-term security and prosperity of the UK.”
The Foreign Office said it had provided additional funding to start to cover the costs of housing refugees.
