The UK government has recovered £74 million from excessive profits made by companies running asylum accommodation, following a review of contracts after Labour took office last year.

While welcomed, the sum represents only a small fraction of the £2.1 billion spent on asylum accommodation in 2024/25—equivalent to less than two weeks’ costs.

Ministers have sought to cut expenses through room sharing, cheaper alternatives, and plans to use military sites, while promising to end the use of asylum hotels before the next general election.

The Home Office faced criticism from MPs for mismanaging contracts and underutilizing mechanisms to reclaim excess profits, with some contracts allowing termination in 2026, the BBC has reported.

Shadow Home Secretary Chris Philp argued that ending hotel use entirely is the only solution, highlighting rising numbers of illegal Channel crossings and framing the issue as part of broader border control challenges.