Firm paid to house migrants in hotels loses Home Office contract over ‘performance and behaviour’ – UK politics live | Politics
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- March 25, 2025
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Ministers have announced that the £10bn Lower Thames Crossing, a road tunnel under the Thames connecting Kent and Essex, has been approved.
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Developers have been trying to get approval for it for years, and the project has frequently been cited as an example of why UK planning laws are sclerotic.
Keir Starmer referenced it recently when he complained about “infrastructure that needs planning documents longer than the works of Shakespeare”. Work on the Lower Thames Crossing has already cost more than £1bn, and the planning documents are said to run to 359,070 pages.
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In a response to Pennycook’s comments (which follow a similar response from Heidi Alexander, the transport secretary, to questions about Reeves’ tickets yesterday), the shadow Cabinet Office minister, Mike Wood, said:
This is an extraordinary slap down of the profligate champagne lifestyle Rachel Reeves’ has been enjoying since becoming chancellor.
When senior Labour ministers are openly criticising her judgment then it’s no suprise business and investors are as well.
The chancellor must kick her addiction to freebies and focus on undoing the damage she’s doing to family finances in her emergency budget tomorrow.
The reference to Reeves enjoying a “profligate champagne lifestyle” may surprise people who know the chancellor. Earlier this year she told the BBC that she brings her own lunch into the office in a tupperware box, and that she collects leftover pastries from meetings to eat later. Wood may be referring to the fact that the O2 tickets were for seats in a corporate box.
It has also been reported that Reeves accepted free theatre tickets for Oscar Wilde’s The Importance of Being Earnest and an adaptation of Neil Streatfield’s Ballet Shoes at the National Theatre in December.
But in previous governments other ministers have accepted freebies far more often. And when various Labour ministers were facing criticism for accepting Taylor Swift tickets and free clothing soon after the election, Reeves did not feature in those stories.
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Matthew Pennycook, the housing minister, has been giving interviews this morning. Asked if the Home Office would recover money from Stay Belvedere Hotels over the failed contract for housing asylum seekers in hotels (see 9.25am), he replied:
The whole purpose of reviewing asylum contracts is to improve the management of them to guarantee value for money for the taxpayer … the operational details are being worked out.
I’ll leave it to Home Office ministers to come back with the finer points of detail on the decision they’ve made, but work is underway to ensure the asylum services continue to operate as normal, to deal with the management problems.
He went on:
We did need to review these disastrous contracts on asylum accommodation we inherited. We’re doing so to improve management and guarantee value for money for the taxpayer.
We will be opening comments on the blog at about 10am.
Firm paid to house migrants in hotels loses Home Office contract over ‘performance and behaviour’
Good morning. There are many reasons why people object to tens of thousands of asylum seekers being housed for long periods in hotels and other temporary accommodation, but one is the perception that this is enabling a small number of firms to make huge profits at public expense for providing what is often a miserable service. This morning we learned that the Home Office is doing something about this. It has removed the contract for this work from Stay Belvedere Hotels (SBHL), blaming “concerns about its performance and behaviour as a government supplier”.
In a news release issued just after midnight, it says:
The Home Office has taken action to remove Stay Belvedere Hotels (SBHL) from government operations.
SBHL, which is responsible for the running of 51 hotels in England and Wales and Napier Barracks housing people waiting for asylum decisions, is being removed following examination of its contract and contractual arrangements with the Home Office, including concerns about its performance and behaviour as a government supplier.
The safety and security of people working and staying in temporary accommodation is a government priority, together with ensuring value for money for the taxpayer. The Home Office has been working carefully over the past weeks to put robust plans in place to ensure asylum services continue operating as normal during this transition with as little disruption to asylum seekers and staff as possible.
And Angela Eagle, the minister for border security and asylum, said:
Since July, we have improved contract management and added more oversight of our suppliers of asylum accommodation.
We have made the decision to remove Stay Belvedere Hotels from the Home Office supply chain and will not hesitate to take further action to ensure Home Office contracts deliver for the UK.
The Home Office confirmed the news after the Times published a report by Matt Dathan about SBHL losing the contract. Dathan says:
Sources said it was one of the worst examples of companies that were exploiting the asylum crisis to make a profit. SBHL’s latest published accounts show it made a record profit of more than £50m …
[The move] comes after the Treasury ordered the Home Office to find cheaper providers and to prevent private companies “profiteering” from the asylum crisis.
In a document published by the Treasury’s new Office for Value for Money (OVfM) it says companies that have been contracted to find hotels for migrants have “made record profits in recent years, leading to accusations of profiteering” …
With more than 38,000 migrants in hotels, it is costing the Home Office £5.5m per day.
Dathan says one of the companies that will take over these hotel contracts is Corporate Travel Management, the firm that ran the Bibby Stockholm barge when it was used to house asylum seekers.
The government is more keen to talk about something else – a Treasury announcement about a £2bn investment in social and affordable housing. As Jessica Elgot and Richard Partington report, the announcement comes a day before the spring statement, at a time when Rachel Reeves, the chancellor, is anxious to persuade MPs that there is more to the government’s programme than just spending cuts. They report:
One Whitehall source said the social housing announcement and the £600m in investment on construction skills announced over the weekend were attempts to “sweeten the pill” ahead of Wednesday by bringing forward plans from the spending review.
The £2bn will effectively bridge the gap between the current affordable homes spending due to expire in 2026 and the next funding settlement which will come in the spending review in June when a successor programme is expected to be announced.
Here is the agenda for the day.
11.30am: Downing Street holds a lobby briefing.
11.30am: Wes Streeting, health secretary, takes questions in the Commons.
After 12.30pm: MPs consider Lords amendments to three bills, including the GB Energy bill.
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