Rob Waugh
THE Home Office is paying millions of pounds over the odds to house asylum seekers, the Government spending watchdog has warned.
The National Audit Office said contracts signed to accommodate asylum seekers were costing at least £25m more than market rates.
Accommodation for each asylum seeker cost an average of £8,430 a year or £703 a month in 2003-04. Housing claimants in short-term accommodation was even more costly at £846 a month. Many landlords were receiving taxpayers' money for unoccupied properties because contracts signed by the Government were so inflexible, the NAO report revealed.
A further saving of £3.6m a year could be made if a two-week limit were placed on time asylum seekers spend in emergency accommodation, it added.
In all, £439m was spent by the Home Office's National Asylum Support Service (NASS) to house asylum seekers in 2003-04, out of a total £1.07bn budget. Consultants hired to look at the way NASS paid for accommodation concluded there was "considerable scope" for savings, the NAO report said.
The auditors urged NASS to "build up an awareness of typical regional prices so that it can negotiate competitive rates".
Out of 23 contracts with landlords, six contractors were paid the full amount for empty properties, and a further 11 contractors received 70 per cent to 90 per cent of the rent. Existing arrangements are not sufficiently responsive to changes in the number of asylum seekers," the report said.
"Any declines in demand are unlikely to lead to much of a reduction in cost as some accommodation providers are paid whether their properties are occupied or empty."
Earlier this year, it was revealed that Yorkshire was home to the highest number of asylum seekers in the country.
At the end of March, 9,010 asylum seekers – down from 9,370 in the previous quarter – were being looked after in NASS accommodation in the region.
But while the number topped the Home Office league table, the downward trend reflected a 17 per cent drop in NASS asylum applications nationally.
NAO chief Sir John Bourn said: "Providing suitable accommodation for asylum seekers is one of the most complex and difficult tasks facing the Government.
"The NASS was stretched to the limit when the number of asylum seekers in accommodation reached over 67,000 in March 2003.
"Although the service managed to deal with this workload, its contracts did not always provide value for money.
"In order to avoid such difficulties in future, it is important that NASS be able to respond more readily to fluctuations in demand.
"By transferring more of the risks and responsibilities on to its contractors, the service will be in a better position to monitor performance and take corrective action when there are changes in the number of asylum seekers requiring accommodation."
Immigration Minister Tony McNulty said: "Since NASS was set up the asylum situation has changed very significantly.
"The number of applications has fallen sharply and is now 73 per cent lower than the peak of October 2002," he said
"We have speeded up the system so that over 80 per cent of initial decisions are now taken in two months, and the number of outstanding claims is at the lowest level for a decade and numbers receiving NASS support continue to fall.
"As a result of these achievements we are renegotiating contracts, saving £37m in 2004/05 and remain on track to cut asylum support costs by a third by the end of 2005."