How Britain Turned Asylum Into a Billion-Pound Profit Machine

The numbers tell a simple story. In 2019, the Home Office signed contracts worth £4.5 billion to house asylum seekers. Today, those same contracts are projected to cost £15 billion. That’s not a budget adjustment—that’s a three-fold increase for the same basic service.

Graham King, founder of Clearsprings Ready Homes, has extracted £187 million in profits from his share of this arrangement. He paid himself £183 million in dividends. He is now worth over a billion pounds and ranks 154th on the Sunday Times Rich List.

Meanwhile, asylum seekers in his company’s hotels receive seven sanitary towels per menstrual cycle. Four people share one toilet roll per week. Children eat food that a University College London professor describes as institutional neglect. Charities had to set up emergency food banks because residents were going hungry despite being in supposedly catered accommodation.

This is not a story about asylum policy. This is a story about how British institutions now function.

The System As Designed

Clearsprings operates under a Home Office contract that runs until 2029. The company has admitted to MPs that hotels are “eight times more profitable” than proper housing. It has also admitted that hotels are “really bad for people.”

Read that again. The contractor openly states that the most harmful option is the most profitable one. And the contract incentivizes exactly that option.

At its peak in 2023, 400 hotels housed asylum seekers. The Home Office now claims success because it has reduced this to 210 hotels. It celebrates cutting daily hotel costs from £9 million to £5.5 million.

Let that sink in. The government is still spending £5.5 million per day—over £2 billion per year—on hotel accommodation. And it considers this an achievement.

The National Audit Office reports that all three asylum accommodation providers combined have made £383 million in profits since 2019. For context, that’s enough to build approximately 1,500 units of social housing, which would actually solve the problem these companies are paid to manage.

What the Money Bought

The BBC obtained evidence from multiple Clearsprings sites. The pattern is consistent:

Food: Uncooked chicken. Frozen meals served still frozen. Spaghetti with ketchup. Two white rolls with tofu on a paper plate. Past-expiry-date items. Minimal fruit or vegetables. Heavy carbohydrates—bread, chips, rice—with little protein.

One mother boils eggs in her hotel room kettle because it’s the only way to get protein for her eight-year-old daughter. She does this while Clearsprings describes its service as providing “value for money, quality and transparency.”

Hygiene: Dirty mattresses on arrival, some with bloodstains. Broken toilets. Rationed toilet paper and sanitary products. Conditions so poor that a paediatrician focusing on these facilities for 18 months concluded that if parents fed their children this way, it would be called neglect.

The Response: Hackney Foodbank staff initially questioned why asylum seekers were requesting donations when they supposedly received catered accommodation. Then they visited the hotels. Now they provide regular emergency food support.

Sixty charities signed an open letter describing “miserable conditions” while “millions in public money is simply taken in profit.”

The Offshore Mystery

During parliamentary testimony, MPs discovered that Clearsprings paid £17 million to an offshore company called Bespoke Strategy Solutions Ltd, registered in the United Arab Emirates.

The company’s managing director told MPs this entity is owned by Graham King and invoices for “strategic solutions services.” When the BBC tried to find this company, they located a similarly named Dubai firm whose founder had never heard of King and had no UK connections.

Clearsprings refused to comment on this arrangement. The Home Office did not clarify. £17 million in public money paid to a mysterious offshore entity, and the responsible authorities offer no explanation.

TaxWatch, an investigative think tank, called the arrangement “highly unusual.” That may be the understatement of the year.

The Accountability Gap

Liberal Democrat MP Paul Kohler, who sits on the Home Affairs Select Committee examining these contracts, called the profits “obscene.” He compared the situation to the PPE scandal during Covid—another example of poorly designed government contracts enriching private providers while failing to deliver adequate services.

Kohler noted the obvious: contracts written to incentivize hotels over proper housing were a “failure at all levels of government” where “private enterprise has simply been allowed to run roughshod.”

Yet here is what matters most—this is not a breach of contract. Clearsprings is operating within the terms of its agreement. The company told MPs it made an average of 6.9% profit and would repay anything above 5%. It claimed to have £32 million “ready to go” back to the government, pending Home Office instruction.

The problem is not that one company is breaking rules. The problem is that the rules were designed to produce exactly this outcome.

The Cross-Party Failure

These contracts were signed under the Conservative government in 2019. They continue under Labour. The current government has “reduced the asylum backlog by 24%” and “returned 35,000 people with no right to be in the UK,” according to the Home Office. It commissioned an audit and claims five contracts exceeded profit-sharing thresholds.

But the fundamental arrangement remains unchanged. The contracts run until 2029. Clearsprings will receive up to £7 billion under current projections. The same incentive structure persists—the one that makes hotels eight times more profitable than proper housing, the one that rewards keeping people in temporary emergency accommodation rather than finding permanent solutions.

An asylum seeker the BBC called Arturo summarized the situation: “If you give me a job, I pay tax, I leave the accommodation. I don’t need your support because I can work.”

He cannot work. Asylum seekers generally cannot work in the UK unless their claim takes more than 12 months, which many do because of the backlog the government celebrates reducing.

So the system keeps him in a hotel, costing taxpayers far more than employment support would cost, while preventing him from contributing economically. Clearsprings profits from this arrangement. Graham King becomes a billionaire. Children eat inadequate food. And politicians from both parties present minor adjustments as achievements.

What This Reveals

This is not about whether Britain should accept asylum seekers or how many. This is about institutional competence and what the British state has become.

A competent system would recognize that hotels are the most expensive, least suitable option for housing people long-term. It would design contracts to reward providers for moving people into permanent accommodation quickly. It would penalize extended hotel use. It would measure success by how few hotels are needed, not how much the hotel bill has been reduced.

Instead, Britain designed a system where the most expensive, least suitable option is the most profitable. Then expressed surprise when providers choose that option. Then celebrated minor reductions in the resulting catastrophic costs as evidence of improved management.

The children eating inadequate food are symptoms. The billion-pound profits are symptoms. The mysterious offshore payments are symptoms. The real disease is the institutional dysfunction that designs systems guaranteed to fail and then congratulates itself for marginally reducing the scale of failure.

The Pattern

This is not an isolated incident. It is a pattern that repeats across British institutions:

Covid PPE contracts: Billions spent, massive profits extracted, inadequate equipment delivered, little accountability.

Rail franchises: Guaranteed profits for operators, degraded service for passengers, taxpayers covering losses.

Probation privatization: Cheaper contractor bids, worse outcomes, eventual renationalization at additional cost.

Welfare assessments: Private contractors paid per assessment, disabled people denied support, successful appeals costing more than proper initial decisions.

The structure is always the same. Government outsources a public function. Contracts are designed to transfer risk but actually guarantee profits. Quality deteriorates. Costs escalate. No one is held accountable. The contracts continue.

The Bottom Line

Britain is spending over £2 billion per year housing asylum seekers in hotels. This is approximately eight times more than properly housing them would cost. Private companies make hundreds of millions in profits from this arrangement. The service they provide has been described by their own representatives as “really bad for people.”

The government knows this. MPs know this. Charities know this. The contractors themselves know this.

And yet the system continues, with minor adjustments presented as major reforms.

This is not incompetence. This is how British institutions now function. They are optimized not for solving problems, but for extracting maximum resources while maintaining minimum accountability. The more expensive and ineffective the solution, the more money flows to private providers. The worse the outcomes, the longer the contracts continue.

One asylum seeker suggested that public frustration should be directed at the companies profiting from accommodation contracts, not at the people trapped in inadequate hotels. He’s correct, but he’s also missing the larger point.

The real frustration should be directed at a political and administrative class that designs systems guaranteed to fail, awards contracts that reward failure, and then expects credit for marginally reducing the costs of the failure they created.

Graham King is now a billionaire. Children are eating inadequate food in institutional accommodation. And British politics continues to debate asylum policy while ignoring the dysfunctional state capacity that turns every challenge into a profit opportunity for connected contractors.

This is Britain in 2025. Not because of any one party or any one policy. Because of institutional decay so profound that billion-pound failures are considered business as usual, and minor reductions in catastrophic waste are presented as success stories.

The decline continues. The profits continue. And the pretense that any of this represents competent governance continues.

That may be the biggest fiction of all.