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Incredible waste of £23million spent on luxury hotel for migrants – and not one room used
The Home Office spent £23 million on a nine-month contract for the Atrium hotel near Heathrow, but never used it to house asylum seekers. The National Audit Office says the department had expected a surge in demand at the former RAF Manston processing site; the resulting loss has renewed Conservative calls for tougher migration policies, including reviving the Rwanda plan.
The contract was signed in August 2025, and Conservatives say its cost amounted to more than £84,000 a day. The audit found asylum spending reached £3.7 billion in 2025-26, against a £3.6 billion budget. It also said the estimated ten-year cost of asylum accommodation rose from £4.5 billion in 2019 to £15.3 billion in 2024, partly because more people were housed in hotels than expected. The Refugee Council said hotels are unsuitable and costly, and argued for community-based accommodation while cases are decided.
In short
- The Home Office lost £23 million on an unused hotel contract.
- Asylum spending exceeded its 2025-26 budget by £100 million.
- The hotel bill has revived debate over accommodation and migration policy.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
The Home Office can argue that reserving the hotel was precautionary planning against a possible surge in arrivals and pressure on Manston, where a lack of capacity could have created serious operational and humanitarian problems. The contract may therefore be seen as buying rapid access to accommodation, with the cost reflecting the need to secure it in advance rather than evidence that officials expected every room to be used.
The case against
Critics can argue that paying £23 million for accommodation that housed no one shows a serious failure to forecast demand, negotiate contract terms or provide transparent oversight of public money. With asylum accommodation costs rising, they say the episode strengthens the case for tighter controls on spending and faster decisions, while community-based options may be more suitable and less costly than relying on hotels.