Asylum hotel provider makes £180m profit despite claims of inedible food and rationed loo paper

A company providing accommodation for asylum seekers has earned nearly $187 million in revenue since being awarded lucrative government contracts — despite allegations of appalling living conditions in the hotels it manages.

Clearsprings Ready Homes, one of three firms with 10-year Home Office contracts to house asylum seekers, has seen the estimated total cost of the scheme soar from an initial £4.5 billion to around £15 billion. The company, which operates across southern England and Wales, is now expected to receive about £7 billion under the new projections.

The BBC has spoken to asylum seekers living in hotels managed by Clearsprings, several of whom say public anger should be aimed not at them, but at the private companies profiting from the government’s outsourcing arrangements. MPs have also raised questions about the contracts and the conditions inside the hotels.

Residents in multiple Clearsprings-run sites have shared photos and video diaries of what they describe as “unhygienic and inedible” food, cramped rooms, and poor sanitation.

Soaring Profits and Limited Oversight

Since taking over its contract in 2019, Clearsprings Ready Homes has paid nearly as much in dividends to its parent company as it has earned in profits. Its founder, Graham King, has not responded to repeated BBC requests for comment, and the company itself declined to issue a statement.

According to the National Audit Office, Clearsprings and the other two accommodation providers have made a combined £383 million since 2019. Clearsprings currently supports around 30,000 asylum seekers across southern England, London, and Wales. Around half are housed in hotels subcontracted by the firm — a greater reliance on hotel accommodation than either of its competitors.

The sharp rise in the value of Clearsprings’ Home Office contracts has been attributed to an increased use of hotels and the growing number of asylum seekers arriving in the UK by small boat. In written evidence to a parliamentary committee earlier this year, the company said this had driven up operational costs.

Clearsprings and one other provider have confirmed that they intend to repay funds earned beyond profit limits set by the Home Office, though it is unclear whether this has yet occurred.

“Not Good Value and Not Transparent”

A coalition of 60 charities, led by Good Jobs First, has accused the contractors of profiting from public money while asylum seekers live in “miserable” conditions.

“People seeking asylum are being housed in degrading environments while millions in public funds are funnelled into a handful of private companies,” said Maia Kirby, a spokesperson for the group.

Clearsprings claims on its website to “deliver value for money, quality and transparency.” Kirby, however, disagreed: “It’s not good value — and I certainly don’t think it’s transparent.”

Charities have reported evidence of poor nutrition, rationed sanitary products, and unhygienic living conditions in Clearsprings’ accommodation. Though three meals a day are included, residents describe them as repetitive and lacking in fruit or vegetables.

“It’s Not a Paradise”

Andrea, an asylum seeker from South America, has lived with her eight-year-old daughter in one of the company’s hotels for two years.

“People think we live in paradise,” she said. “But the beds are stained, the toilets are dirty, and everything is broken. Sometimes food that’s gone off is still served.”

Andrea said she often boils eggs in her room to give her daughter some protein and visits a food bank because she cannot afford to buy extra food. Asylum seekers receive about £9.50 per week in support.

Charities Step In

Farhan Jaisin, who works for a food bank in Hackney, east London, said he was reluctant to hand out donations to asylum seekers at first, believing hotels provided sufficient meals. But after visiting the sites, he changed his mind.

“The food is terrible. Some people get one toilet roll a week. Women told us they only receive seven sanitary pads a month,” he said.

Professor Monica Lakhanpaul, a paediatrician and child health researcher at University College London, described the situation as “neglectful.”

“If a parent fed their child this way, it would be called neglect,” she said. “Children in asylum hotels are being forgotten.”

Hotels as “Temporary” Solutions

Hotels were initially used as emergency accommodation after the government ran out of housing for asylum seekers. At the peak in 2023, around 400 hotels were in use; this number has since fallen to about 210.

The Home Office says it has reduced daily hotel costs from £9 million to £5.5 million, and insists it is working to move asylum seekers into more suitable accommodation.

One resident, who has spent five years seeking asylum after fleeing gang violence in South America, acknowledged British frustration about government spending but said private contractors were the real beneficiaries.

“I want to work and pay my way,” he said. “I don’t need help — but I’m not allowed to work.”

Asylum seekers in the UK are barred from employment unless their claims remain unresolved for more than a year.

“Obscene” Profits and Dubai Links

According to the Sunday Times Rich List, Clearsprings founder Graham King is now a billionaire, ranked 154th richest in the UK. He remains the sole shareholder of the parent company, Clearsprings Management, which has paid out more than £183 million in dividends since 2020.

The company told MPs that some profits would be reinvested in social housing programmes. In written evidence, it argued that hotels offered “more cost-effective” emergency accommodation than long-term housing, though it acknowledged that hotels were “unsuitable” for extended stays.

Liberal Democrat MP Paul Kohler, a member of the Home Affairs Select Committee, called the firm’s earnings “obscene.”

“The contracts were structured in a way that encouraged companies to use hotels rather than shared housing because it’s far more profitable,” he said. “This is a failure at every level of government — a repeat of the Covid PPE debacle.”

Kohler urged the government to consider activating a break clause next year, arguing that taxpayers were “not getting value for money.”

The committee also questioned a £17 million payment to a Dubai-based firm called Bespoke Strategy Solutions Ltd (BSS), reportedly linked to Clearsprings’ leadership. The company listed as BSS in the UAE denied any connection to Graham King or Clearsprings, calling the matter “a case of mistaken identity.”

Mike Lewis, a consultant at the think tank TaxWatch, said the arrangement of paying an executive through an overseas service company was “highly unusual.”

Government Response

A Home Office spokesperson said: “We are committed to reducing costs and ensuring value for the taxpayer. Since 2023, we have reduced hotel use by half and cleared 24% of the asylum backlog.”

The spokesperson added that five contractors had already returned excess profits to the government following an audit.

The Home Office is now exploring alternatives to private providers — including proposals for local councils to take over responsibility for asylum accommodation.