More than 100,000 asylum seekers could be given taxpayer-funded houses, flats and bedsits, under Home Office plans.

Ministers have been accused of taking taxpayers “for a ride” as they splurge billions on asylum accommodation whilst young families struggle to get on the housing ladder.

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Some 32,345 asylum seekers are living in hotels, while 66,683 are living in “dispersal accommodation” across the country.

But the Home Office has told an inquiry by the Home Affairs Select Committee that this could rise to 100,300, under the terms of the asylum accommodation contracts with Serco, Mears and Clearspring Ready Homes, as it tries to close migrant hotels.

Officials also admitted the Home Office has paid providers more amid “challenging market conditions” to help move migrants out of hotels.

They revealed: “By increasing DA [dispersal accommodation] pricing and the volume caps, this should have given AASC providers greater buying power within the rental market, allowing them to increase capacity.

“However, in practice, DA pricing uplifts have not consistently supported the level of DA capacity growth anticipated.”

Reform UK’s Lee Anderson told the Daily Express: “Companies such as Serco, Mears, and CRH plan to relocate over 100,000 migrants to towns and villages across the country — fuelling crime rates, contributing to the destruction of British culture, and getting rich in the process.

“Decent Britons work hard every day—paying high taxes, supporting their families, and contributing to society.

“They should not have to worry about groups of unidentified, fighting-age males roaming the streets in their communities. Only Reform will put a stop to this lunacy.”

Shadow Home Secretary Chris Philp said: “These figures reveal that the Government doesn’t believe its own claims to smash the gangs.

“They are budgeting for over 100,000 people – mainly illegal immigrants – to be accommodated in flats and homes that young people here can only dream of.

“The spending review showed that even in 2029 the Government plans to spend £2.5 billion a year housing illegal immigrants.

“They are taking British taxpayers for a ride by splashing billions of our hard-earned money on putting up illegal immigrants, when hard-working British young people have nowhere to live.

“This madness has to end. Every illegal immigrant who arrives here must be immediately removed.”

In an alarming sign of how the migrant hotel bill has spiralled, the Home Office revealed: “Contingency accommodation hotels were only meant to be a temporary measure for a short period when they were first utilised.

“However, we have relied on the CA hotels for several years, which reduces the incentive for AASC providers to expand their estate.”

The migrant crisis is costing taxpayers £4.7 billion a year.

The Home Office and asylum accommodation providers meet with council chiefs every month to discuss the “procurement” of properties “in line” with plans to house migrants in different communities.

The Home Office submission to the Home Affairs Select Committee added: “The volume and location of DA is based on an evidence driven indexing tool which considers market availability, current population and social pressures in each local authority area”.

Serco, Clearspring Ready Homes and Mears are not paid for empty “dispersal accommodation” beds.

Robert Bates, Research Director at the Centre for Migration Control, said: “Politicians of both parties have allowed the asylum system to descend into chaos.

“A 50% increase in the volume of dispersal accommodation places required is testament to the anarchy we have seen at our borders in recent years.

“The Home Office is clearly working on the assumption that it will need to procure tens of thousands of new rooms to match the growing number of illegal migrants entering our country, but are hiding the true scale of these plans from the British public.

“These figures show that many more communities will be blighted by the imposition of undocumented males into their neighbourhood, that those looking to enter the rental market are now competing with a government prepared to pay over the odds for housing, and that large corporations are continuing to profit from the misery that our asylum system is imposing on the country.”

Chancellor Rachel Reeves has confirmed Labour wants to close every migrant hotel by July 2029.

The Chancellor said an extra £200m will allow the Home Office to “cut the asylum backlog, hear more appeal cases and return people who have no right to be here”.

Treasury documents show that taxpayers will still be shelling out £2.5 billion in 2028/2029 on asylum.

Spending plans also show the Home Office will spend 3.6 billion on asylum in 2025/2026, £3.6bn in 26/27 and £2.9bn in 27/28.

Border Security and Asylum Minister Dame Angela Eagle said on Tuesday revealed ministers want to use more abandoned tower blocks, “old teacher training colleges”, or former student accommodation as a substitute for hotels and renting properties.

Asylum seekers have been given houses in more than 80 per cent of council areas, a Home Office official admitted.

More migrants are being moved across the country to ease the burden on local authorities crippled by a lack of housing, overwhelmed health services and growing community frustrations.

Joanna Rowland, Director General of Customer Services at the Home Office, told a group of MPs the number of council areas with asylum accommodation has increased over the past year from around 70% to 81%.

Ms Rowland told the Home Affairs Select Committee: “One of the things we need to guard against is uncontrolled levels of dispersed accommodation.

“Another priority for the Government is levelling up the allocation of dispersed accommodation across local authorities.

“There has been success to-date, in that there is now only 19% of local authorities without any dispersed accommodation, up from 30% a year ago.

“But we need to do the hotel exit and the alternative accommodation in a highly controlled way because if it was just an edict to close hotels and get into dispersed [accommodation], then we would end up with an uneven concentration.

“Some local authorities, I know, are feeling that acutely”.

A Home Office spokesperson said: “According to previously-published data, the number of asylum-seekers in supported accommodation across the UK reached a peak of just below 125,000 in Autumn 2023, when there were 400 hotels in use at a cost of almost £9 million a day.

“By the time the current government came to office, asylum decision-making had collapsed, and thousands of people were stuck in limbo in asylum accommodation with no prospect of their cases being processed.

“That was the situation the current government inherited, but it has taken immediate action to fix it – increasing asylum decision-making by 52% and removing 30,000 people with no right to be here.

“Our objective now is to build on that progress, by clearing the asylum backlog, removing more failed asylum-seekers from the UK, ending the use of expensive asylum hotels, and reducing the total number of people in need of asylum support.”