‘Stop the boats’ law may block ministers diverting aid budget to UK asylum costs

UK Government Ministers may be blocked from diverting billions of pounds of overseas aid funding to supporting asylum seekers in the UK by the new ‘stop the boats’ law, a watchdog has found.

The Independent Commission for Aid Impact (ICAI) said the Illegal Migration Act could “close off the main source of funding” for housing arrivals in the UK.

Sarah Champion, the MP who chairs the Commons International Development Committee, described the finding as a “spectacular own goal” for the Government.

Using the Official Development Assistance (ODA) budget, already cut by Rishi Sunak, to fund refugee costs in the UK has long been criticised. Nearly £3.7 billion was diverted last year.

But the ICAI report says this could be shut off if Home Secretary Suella Braverman’s legislation is fully enacted following legal challenges to the Rwanda policy.

This is because the OECD, of which the UK is a member, states that aid funding can only be spent on “in-donor refugee costs” if individuals are awaiting an asylum decision.

It says that if migrants who arrive by unauthorised means in the UK are deemed illegal and barred from receiving asylum then aid funding would not be eligible to be used on accommodation pending their removal.

Dr Tamsyn Barton, the ICAI’s chief commissioner, said it would mean the Home Office having to meet the costs out of its own budget rather than the Foreign Office’s.

“Our analysis of the aid rules suggests that the Illegal Migration Act, if fully implemented, could close off the main source of funding the Government is using to house asylum seekers,” she said.

Dr Barton said that using the aid budget on hotel costs for asylum seekers rather than supporting people in their home countries is “inequitable as well as inefficient”.

Counter-productive

Ms Champion, a Labour MP, said: “Spending billions of our greatly reduced foreign aid budget in the UK – the bulk of it on hotels for the tens of thousands of people awaiting an asylum decision in a horribly backlogged system – was always counter-productive.

“Spending in this manner was against the spirit of the ODA rules and now it seems with the Illegal Migration Act, the Government has made its policy in breach of those same rules.

“It’s a spectacular own goal for the Government. ODA needs to be allowed to return to tackling the reasons people flee their homes, not deal with the consequences.”

The Home Office said it is still assessing the Act’s impact on ODA spending, but insisted it acts in accordance with the OECD rules.

A Government spokesman said: “It is vital that we deter people from risking their lives in extremely dangerous small boat crossings.

“The Illegal Migration Act will mean that people who come to the UK illegally will not have a right to stay.

“Instead they will be liable to be returned either to their home country or relocated to a safe third country, breaking the business model of people smugglers and stopping the unprecedented strain on our asylum system.”