The Home Office’s “rationalisation” of contracts for asylum seeker accommodation from 22 to six led to extra costs, delays and a failure to inspect properties properly, a new report the Public Accounts Committee has said.
It also claimed the UK government’s decision to rationalise the contracts and award them to big companies will fail to make the £140 million savings because they have been badly managed.
MPs have highlighted a failure by two firms, G4S and Serco, that had no experience of working with asylum seeker accommodation, and raised concerns that a failure to check properties had an impact on a “vulnerable group” in society.
The report comes after concerns about asylum seeker centres including the detention of children at Dungavel in Scotland, where youngsters were held in detention centres long after a coalition deal between the Tories and Lib Dems was supposed to end the practice.
The Labour chairman of the public accounts committee, Margaret Hodge, said: “The Home Office’s decision to rely on fewer and larger contractors was risky and lies at odds with the government’s stated commitment to encourage small and medium sized companies to deliver public services.
“The knowledge of experienced specialist providers has been lost and there are fewer options available to the department if the contractor fails.”
The committee also noted proper checks were not carried out on accommodation to make sure they were suitable and blamed the three-month turnaround period for the new contracts along with a “hands off” approach by the government.
Ms Hodge said: “The standard of the accommodation provided has often been unacceptably poor for a very fragile group of individuals and families. The companies failed to improve quality in a timely manner.
“None of this was helped by the department’s failure to impose penalties on contractors in the transition period. It is disturbing that over a year into the contract, the accommodation is still not of the required standard and the department has only chalked up £8m in savings.”
She added: “Looking beyond the contracts, the Home Office must insist adequate plans are in place for how it will manage the introduction of any new contracts in the future, including an understanding of what will be inherited from previous contractors, and clear arrangements for exiting previous arrangements.”
SNP home affairs spokesman Pete Wishart said the report was “worrying” and highlighted it was the latest in a series of concerns about asylum seeker accomodation, including in Scotland.
He said: “The issues raised in this report are worrying. In a bid to cut corners, the Home Office is failing to adequately protect vulnerable asylum seekers. Sadly, this is not the first time concerns have been raised about the way in which the UK government deals with asylum seekers.”
A Home Office spokesperson said: “The UK has a proud history of granting asylum to those who need it and providing accommodation while applications are considered.
“Our new COMPASS contracts are generating vital savings to the taxpayer – £8 million was saved in the first six months of operation and further significant savings are predicted for 2013/14.
“A recent National Audit Office report also found that the transition to our new providers was well-managed and noted that operational performance is improving.
“While we accept there are challenges with the contracts, we are disappointed with the PAC’s findings and will respond in due course.”