Close to half of Britain’s newly-reduced aid budget is set to be spent on housing asylum seekers, according to new analysis.
Based on current projections, the Financial Times reports a reduced aid budget in 2027 would be £9.2billion.
During 2023, £4.2bn or 28 per cent of the aid budget was spent domestically on refugees, almost entirely covering hotel costs for asylum seekers.
Government officials expect spending on asylum hotels to remain high, potentially consuming about 45 per cent of the reduced budget.
The Suites Hotel in Knowsley, Merseyside was used as an asylum seeker hotel in 2023
PA/GB News
It comes after the Prime Minister announced on Tuesday that he would cut aid spending from 0.5 per cent of gross national income to 0.3 per cent by 2027.
The reduction aims to fund a rise in defence spending from 2.3 per cent of GDP to 2.5 per cent.
One government official warned: “The actual figure spent on aid is going to be really, really small.”
The official predicted the sum spent overseas could be as little as half the aid pot. The Foreign Office wants more of the financial burden to be shouldered by the Home Office or through extra Treasury funding.
Home Office figures reveal that 108,138 people applied for asylum in the UK in 2024, the highest number for more than 20 years.
Applications were up by 18 per cent from 2023, with Pakistani nationals making up the largest group of applicants.
LATEST ASYLUM SEEKER NEWS
RAF Wethersfield is being used to house asylum seekersPADespite Labour’s pledge to end the use of asylum hotels, the number of asylum seekers housed in them has increased by more than 8,000 since the election.
Dame Angela Eagle conceded last month that the total number of hotels contracted by the government has risen from 213 to 220.
Some Labour MPs have reacted with anger at the prospect of aid spending being used domestically.
Sarah Champion, Labour chair of parliament’s international development committee and MP for Rotherham, said she was “hugely concerned there is currently nothing to compel the Home Office to reduce its [official development assistance] spend.”
Rotherham MP Sarah Champion has backed a national inquiry into the grooming gangs scandalPA“The money needs to come from the Treasury, not from raiding money designed for the poorest countries in the world,” she added.
Labour MP for Kensington and Bayswater Joe Powell described spending on asylum accommodation as a “horrendous waste of taxpayer money”.
The UK’s bilateral overseas development aid was £10bn in 2023, accounting for 65 per cent of the total budget.
In 2024-25, the top recipients included Ukraine, Ethiopia, Afghanistan, Syria and Yemen. Starmer told MPs on Wednesday that it was a “painful” but necessary decision to cut the aid budget.
However, veteran MP Diane Abbott warned the cuts would make people “less safe, not more” when challenging Starmer at Prime Minister’s Questions.
The Home Office was one of the departments hit hardest in the Autumn Budget, with plans to cut asylum system spending by £4bn in two years.