UK foreign aid spending on asylum seekers rises again

More than a quarter of all UK overseas aid was spent on asylum costs at home last year, new figures show.

The Foreign Office statistics reveal £4.3bn of its foreign aid budget went on supporting refugees and asylum seekers in the UK.

That represents a 16% increase from the £3.7bn that was spent in 2022.

Critics say the government has “lost its grip” by allowing the Home Office to use UK foreign aid budgets, weakening crisis prevention schemes.

Labour’s shadow international development minister Lisa Nandy said it “beggars belief” that the government was using the overseas aid budget to “bail out their failing asylum system with a blank cheque”.

She said: “This is sticking plaster politics at its worst, terrible value for money for British taxpayers and is no way to run the development budget or the Home Office.”

Under current aid rules, the government can spend overseas assistance on what are called “in donor refugee costs” for the first year that an asylum seeker is in the UK.

Charities and the government’s aid watchdog criticised ministers for allowing aid spending to rise in the UK at the expense of helping the poorest people overseas.

Much of the £4.3bn is spent by the Home Office (about £2.9bn), mostly on housing for asylum seekers. The rest covers education, health and other social needs.

The UK’s overall aid budget in 2023 had risen by £2.6bn since the previous year, taking the total to £15.4bn, data published by the Foreign and Commonwealth Development Office (FCDO) showed.

However, less money was spent on the FCDO’s overseas bilateral aid commitments – £4.1bn – than on asylum seekers in the UK, the same data showed.

And the UK’s bilateral spending on humanitarian assistance fell from £1.1bn in 2022 to £888m in 2023.

International development committee chair, Labour MP Sarah Champion, said the increasing spend on refugee costs in the UK was “deeply worrying”.

She told the PA news agency: “We have expressed our concerns on a number of occasions and ministers are still not listening.

“Almost 30% of our aid is being spent on refugee costs – nearly five times our bilateral spend on emergency international humanitarian aid.”

She said the cross-party committee did not believe the UK’s overseas aid budget was “being spent in the spirit of the [Organisation for Economic Cooperation and Development] rules”.

The official watchdog of government aid spending, the Independent Commission for Aid Impact (ICAI), said it had continuing concerns about value for money and allowing the Home Office to spend “an unlimited amount” on hosting asylum seekers at the expense of the FCDO’s budget is “cutting across the normal lines of accountability”.

Tamsyn Barton, the ICAI’s chief commissioner, added: “What’s more, using so much of the aid budget on UK asylum hotels, rather than on supporting people nearer home, is inequitable and inefficient.”

ICAI has previously warned that the passing of the Illegal Migration Act might mean that people arriving by irregular routes were no longer eligible for UK aid, an issue Ms Barton said “appears still to be unresolved”.

Gideon Rabinowitz, Director of Policy and Advocacy at Bond, the UK network for Non-Governmental Organisations (NGOs), said: “With over a quarter of the UK aid budget being spent right here in the UK, the government seems to have lost its grip on UK aid spending.

“This is weakening the UK’s ability to respond to urgent global crises and support long-term sustainable development needs in lower-income countries. 

“International NGOs are once again seeing vital funding for emergency support programmes in Somalia, Yemen and elsewhere being cut or held back, and we suspect this is due to escalating Home Office asylum costs taking an increasing chunk of the UK aid budget.”

The Home Office has been contacted for comment.