Britain’s asylum system could be saddled with an extra £1.4 billion in costs by 2028/29 if spending continues at current levels, the Office of Budget Responsibility (OBR) has warned in a shocking report. The budget watchdog’s dire prediction has cast serious doubt on Labour’s ability to deliver on its promises to fix the broken system.
The OBR pulled no punches in its scathing assessment, warning that asylum expenditure could face a staggering £1.4 billion in additional pressures by 2028/29. The bombshell forecast comes as a major blow to Labour’s pledge to end housing asylum seekers in hotels by the next election and slash asylum spending by £1.1 billion, reports GB News.
The watchdog said: “The Home Office Spending Review settlement was made on the basis that the Home Office would fully stop the use of hotels for asylum-seekers in this Parliament, and asylum spending would be £1.1 billion lower at £2.5 billion in 2028-29 compared to 2025-26 plans.”
Small boat arrivals and supported accommodation surge
However, the OBR’s report revealed that the number of arriving small boat migrants and asylum seekers in supported accommodation has skyrocketed by 19% and 8% respectively compared to last year, painting a grim picture of the challenges ahead.
“So far this year, the number of migrants arriving by small boat and asylum seekers in supported accommodation has risen by 19 and 8 per cent, respectively, compared to last year,” the report stated.
“If spending on asylum remained at its 2024-25 level, this would imply £1.4 billion of additional pressure on the Home Office budget by 2028-29.”
Asylum accommodation costs set to triple
The shocking revelations come on the heels of a damning National Audit Office (NAO) report in May, which exposed that the cost of asylum accommodation is expected to more than triple to an eye-watering £15.3 billion over the next decade. The NAO pointed the finger at the rising demand for accommodation from those previously detained under the Tories‘ failed Illegal Migration Act 2023.
Facing intense pressure, Sir Keir Starmer has insisted he wants to see asylum hotels shut down “as quickly as possible.” In a desperate bid to ease the burden, the Home Office has announced plans to temporarily house approximately 900 migrant men in two military barracks in Scotland and southern England.
Just weeks ago, Home Secretary Shabana Mahmood unveiled a raft of hard-hitting reforms to the asylum system, aimed at deterring illegal migration and making it easier to deport those who don’t belong. Under the proposed changes, almost two million migrants who arrived since 2021 will have to wait a grueling 10 years before earning settled status.
Migrants face 20-year settlement wait
Migrants relying on benefits will face an astonishing 20-year wait for settlement – four times the current period and the longest in Europe. Their progress towards settlement will depend on their “contributions” to the UK under the Government’s “earned” settlement plan.
The OBR added: “While our forecast has incorporated most of the changes announced in the White Paper, we do not have sufficient detail on indefinite leave to remain to incorporate these changes.”
“The Government’s stated intention to consult on asylum policy is also a risk to our forecast.”
The damning findings emerged just hours after Chancellor Rachel Reeves dropped a series of bombshell tax raids in her hotly-anticipated Budget, piling more misery on hard-pressed Brits already struggling with the cost of living crisis. As the asylum bill threatens to spiral out of control, tough questions are being asked about Labour’s ability to get a grip on the system and deliver on its bold promises.
