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Refugee Action calls for a not-for-profit asylum system as it launches Most Wanted campaign

By October 11, 2023Press release

Responsibility for asylum accommodation must be taken away from private companies and returned to local authorities.

That is the call from charity Refugee Action as it today launches its “Most Wanted” campaign, which aims to draw attention to the profits private companies are making from asylum housing.

Using a Wild West theme, the campaign features a page on the charity’s website – which lays out the how the for-profit asylum system works – as well as posters that can be shared on social media or printed out and hung up.

In 2019 the Government paid three contractors – Serco, Mears and Clearsprings Ready Homes – £4 billion over 10 years to provide accommodation to people seeking asylum.

On top of this, these companies are paid more than £8 million a day to provide contingency accommodation in hotels. In the 12 months to March 2023 alone the Government paid them £2.28 billion.

Tens of millions of pounds is pocketed as profit. This includes:

  • Clearsprings boosted its profits from £4,419,841 to £28,012,487 to the year ending 31 January 2022, with dividends jumping from £7m to £27,987,262. Its three directors shared dividends of almost £28m.
  • Mears financial statements list adjusted profits before tax at £35.2 million for year ending December 2022, an increase of 37% over that achieved in 2021.
  • Serco’s 2023 half-year results state that revenue increased by 13%, or £294m, to £2,472m (2022: £2,178m). Underlying operating profit increased by 14%, or £18m, to £148m (2022: £130m).

A fourth company, Corporate Travel Management (CTM), was paid £1.6 billion this year to run some asylum accommodation services, including the Bibby Stockholm barge in Portland.

The barge currently lies empty following a legionella outbreak, while a fire safety audit conducted after some people had been moved on board said five improvements were vital to make the barge safe.

In its latest accounts released last month, the barge’s owners, Bibby Line Group, said it stands behind the quality of the Bibby Stockholm, saying it is “safe and functional”.

Refugee Action is calling on the Government to end the “for-profit” asylum accommodation system and commit to spending every penny of public money available to the refugee protection system on strengthening public services and protecting refugees.

That means building a not-for-profit asylum system that invests in the public services we all rely on, recognises the rights and dignity of people seeking safety, ends detention and houses people in communities.

Councils are already under pressure for social housing and need support to provide accommodation.

That’s why Refugee Action recommend a phased withdrawal targeting areas that are harming people, starting with closing barges and camps and stopping the use of subcontractors, instead diverting the money to local authorities.

The next steps are to withdraw from hotel use, defend and enforce national housing standards, more accountability, reporting and enforcement measures, and finally commit to ending contracts with private companies as early as possible.

Refugee Action supports calls by housing charities such as Shelter for government to invest in a new generation of decent, affordable social homes, and it supports the commitment to ending homelessness and rough sleeping by 2024, as it is interconnected to asylum policy.

 

Asli Tatliadim, Head of Campaigns at Refugee Action, said:

“The asylum accommodation contracts have been a licence to print money for these contractors but the gravy train must stop.

“But while the Government gives away billions to these companies people seeking asylum are left to live in accommodation that actively harms their health.

“It’s time the Government funded local authorities to run the system on a not-for-profit basis and spent every penny of this public money on protecting refugees and strengthening services that all of us rely on.”