The UK government is preparing to increase spending on housing asylum seekers as Prime Minister Andy Burnham advances plans to relocate them to more affluent areas, a move that is expected to raise costs for taxpayers. Burnham has emphasized the principle of distributing asylum seekers more evenly across communities, noting that poorer areas have borne a disproportionate share of the responsibility.

Currently, private contractors tasked with providing asylum accommodations must adhere to strict rent caps set by the Home Office, which limits options largely to lower-cost areas. Ministers are reportedly exploring adjustments to these caps to enable placement of asylum seekers in middle-class neighborhoods, where rental costs are typically higher.

A Downing Street source acknowledged the increased financial burden but said Burnham is committed to correcting what he sees as an unfair system. "We all want to see fewer people crossing to the UK and a decreased use of all asylum accommodation, but it needs to be fairer," the official said. The rising costs of asylum housing have already been highlighted, with expenditures reaching £2.7 billion in 2024-25, primarily due to hotel stays. In response, Labour has shifted many migrants into shared housing and military barracks, significantly reducing nightly accommodation costs from an average of £144 in hotels to approximately £23.

As of the end of March, government data showed that nearly 98,000 people were receiving asylum support, with about 73,000 housed in non-hotel accommodations. However, Burnham has expressed concern that asylum seekers remain concentrated in economically disadvantaged regions, including the North West, London, the West Midlands, and Yorkshire and the Humber. Official figures indicate that 11 percent of local authorities have not hosted any asylum seekers.

The Home Office rent cap system calculates allowable accommodation expenses based on median rental values within different localities, permitting higher limits in London than in the North of England but maintaining constraints relative to local market rates. Burnham’s initiative, which aims to involve wealthier areas more extensively, is anticipated to prompt resistance, particularly in constituencies without prior asylum seeker placements.

Criticism has come from Conservative MPs representing areas without asylum accommodations. Dame Harriett Baldwin, whose constituency includes the Malvern Hills, stated her constituents would be opposed to large-scale asylum housing in the area. Similarly, Joe Robertson, MP for the Isle of Wight, argued that site selection should prioritize cost efficiency and taxpayers’ interests, cautioning against political decisions that increase expenses.

Local officials echoed these concerns. James Whelan, leader of the Reform group on the Isle of Wight council, warned that relocating asylum seekers to the island could undermine community trust. He called for a comprehensive reform of the immigration system rather than redistributing its challenges across regions. Areas such as Mid Devon, the New Forest, and Tewkesbury—also represented by Conservative or Liberal Democrat MPs—have likewise not hosted asylum seekers.

Security concerns have been raised regarding the use of houses in multiple occupation for asylum housing, with reports of insufficient safeguards against illegal employment and criminal activity. Fifteen individuals were recently arrested in Thetford in connection with targeting properties believed to shelter asylum seekers.

A government spokesperson highlighted ongoing efforts to phase out hotel accommodations and transition asylum seekers into more basic housing. The number of asylum seekers in hotels has reportedly declined by 35 percent over the past year and by 63 percent since the 2023 peak. Officials maintain that overall asylum costs have dropped by £1 billion since the last general election and reaffirm a commitment to fairly distributing asylum seekers nationwide in cooperation with local authorities.