Councils could receive extra government cash to take migrants out of hotels amid mounting tensions in communities.
Ministers are seeking to disperse migrants from the 200 hotels where 40,000 asylum seekers are currently housed at a cost of £5 million a day as part of the record 166,000 backlog of asylum claims .
The bill is projected to hit £2.3 billion this year amid forecasts of another 65,000 migrants arriving in the UK on small boats across the Channel this year.
Asylum hotels have also become a focus for protests with clashes between far-Right groups and migrant campaigners in locations including Knowsley, Merseyside, Rotherham and Skegness. More demonstrations are expected this weekend.
Migrants cannot be moved out of hotels until they have a permanent place to live.
However, councils which have traditionally taken asylum seekers long-term say they are at breaking point while others say they need more funds if they are to participate in the government migrant dispersal scheme .
Two months since pledge to move migrants
Home Office figures show that the number of asylum seekers receiving housing support and subsistence from councils hit 110,171 in December, up more than 70 per cent from 63,405 at the end of the previous year. Half of the 110,000 were being housed in just 33 of the 372 local authority areas.
Plans to house asylum seekers in disused holiday camps , former student accommodation and old military bases to ease them out of hotels have yet to get off the ground amid local opposition to the moves. It is two months since Rishi Sunak said the Government pledged to move 10,000 migrants out of hotels to alternative large sites.
The Home Office is attempting to disperse asylum seekers to a wider range of council areas through a scheme launched last year that provides authorities with one-off payments of £250 per person and £3,500 for each new occupied bed space.
However, government sources said ministers were now considering further payments to councils to boost the amount of accommodation for refugees and asylum seekers.
“We are more likely to give councils money to buy more stock. This will have a knock on effect on the housing market but it will potentially increase the amount of social affordable housing,” said a government source. “Increasing the payments is a secondary option.”
Ministers are also looking to streamline the process to reduce the bureaucracy for councils. Hundreds of asylum seekers are stuck in hotels because of Home Office rules that prevent them being told their application has been successful until they have been found alternative accommodation.
The rule is designed to prevent councils which are already bearing a disproportionate number of asylum seekers in hotels having to find homes for them once their claim was approved. Instead, they have to wait until accommodation is found elsewhere.
Official guidance states: “If the claimant is currently in initial accommodation and leave has been granted such as refugee leave, humanitarian protection etc, caseworkers must delay service of the [permit] until they have been moved from initial accommodation.”
‘Absurd and counterproductive’
Robert Jenrick, Immigration Minister, told the Commons earlier this month that the Home Office was looking to solve the problem after MPs described it as “absurd and counterproductive”.
Former minister Jonathan Gullis, Tory MP for Stoke on Trent, said the crisis would not be resolved unless “every council across the country takes its fair share in housing asylum seekers”.
“I hope the Government will use its powers to impose themselves upon those local authorities that have dodged taking the difficult decisions that places like Stoke on Trent have made in taking asylum seekers,” he said.
Home Office figures show more than a quarter of the councils have taken fewer than five asylum seekers. While the South West of England has an average of 7.5 asylum seekers per 10,000 people, London has 28.7 per 10,000, North West 24.5, North East 23.4 and West Midlands 20.8.
A Home Office spokesman said: “The number of people arriving in the UK who seek asylum and require accommodation has reached record levels, placing unprecedented pressures on the asylum system.
“The fairer full dispersal model aims to increase the amount of accommodation available for asylum seekers who would otherwise be destitute helping to reduce the time they need to stay in costly hotels.”