Bungling Home Office admits catalogue of costly errors including mistakenly reimbursing migrants £19million that they can’t claw back

Tens of millions of taxpayers’ money have been wasted due to errors with immigration plans.

The Home Office’s annual report has shown that authorities issued incorrect refunds totaling at least £18.7 million to migrants who paid NHS surcharges.

A lot of money has been refunded to foreign nationals and it seems unlikely that the amount will be recovered.

In another blunder, the Home Office spent £22.9 million on an asylum hotel that was never used.

The department signed a nine-month contract for the Atrium Hotel in Hounslow, west London, in August 2025.

It was stated that the payment was made to the hotel ‘to meet the expected increase in asylum claims’ which would result in the Manston small boat immigration processing center in Kent ‘not meeting legal operational standards’.

But ‘operational efficiency initiatives and if demand did not meet expected levels’ meant the hotel would never be needed.

The report said errors related to the Immigration Health Surcharge (IHS) were thought to amount to up to £18.7 million, but ‘the exact quantification depends on ongoing studies’.

IHS requires foreign workers to pay £1,035 per year for each year of their visa, while students and children are charged £776 per year.

However, the annual report said the repayment scheme ‘resulted in some repayments being paid to customers for periods that were not compatible with the basic IHS payment’.

‘Rescue options are being explored but salvageability remains uncertain,’ he continued.

The document also revealed a previously known loss of £14.9 million from the purchase of the former Ministry of Defense facility at Northeye, Bexhill, East Sussex.

It was purchased for use as refugee accommodation but was never put into operation ‘due to excessive costs for remediating the site’.

The Home Office ‘did not cover any of the expenses on the site, resulting in a constructive loss of £14.9 million’.

The report also showed that £3.2 million was spent on planned deportation flights that did not take place.

Shadow Home Secretary Chris Philp said: ‘This is a disastrous waste of taxpayers’ money by this incompetent Labor government.

‘76,000 illegal immigrants have crossed the Channel since the election; This figure is more than under any other prime minister.

‘The solution to this is not to put them in hotel accommodation or elsewhere, which is costing struggling British taxpayers billions of dollars.

‘The solution is to exit the European Convention on Human Rights, which would enable us to deport all illegal immigrants within a week of their arrival.

‘Then the transitions will stop very quickly.’

He added: ‘At a time when families are struggling to make ends meet and everyone is facing increasingly higher taxes, it is frustrating that the Labor government is wasting so much of our money on failed projects designed for illegal immigrants.’

It follows an official report last year which revealed the Home Office had ‘wasted’ billions of pounds on asylum hotels.

MPs criticized the department’s ‘incompetence’ in managing a ‘failing, chaotic and expensive’ system.

The damning report said there was a ‘blatant failure’ by the Home Office to ‘control’ contracts with private companies to house refugees and that companies were allowed to make ‘excessive profits’ from the Channel crisis.

In addition, the Home Office suffered an additional loss of £35.2 million due to a plan to improve the Police National Database.

The contract with CGI IT UK Ltd, confirmed in January 2024, was terminated ‘following repeated delays, increased costs and failure to provide a reliable delivery schedule’.

In a more shocking development, it was revealed that Labour’s senior small boats executive was paid £260,000 last year, including more than £50,000 in lieu of working during his notice period.

The department’s annual report showed Martin Hewitt’s annual salary was in the range of £260,000 to £265,000.

But the Border Security Commander’s package included £51,629 ‘in lieu of notice’ after just 18 months in the job.

His total package also included the ‘buy-out’ of annual leave worth £6,754.

At the time of his departure at the end of March, the Home Office refused to discuss why Mr Hewitt was leaving office.

Sir Keir Starmer appointed former senior police officer Mr Hewitt shortly after becoming Prime Minister, tasking him with reducing the number of small boats crossing the Channel.

But last year saw the second highest annual number of people crossing the Channel, with 41,500 people.

This year’s number of visitors decreased by more than 40 percent compared to last year.

In a further development, new data has shown that more small boat migrants are arriving in Britain than those arriving under Labour’s ‘one in, one out’ deal with France.

In the first 11 months of the program, 1,117 immigrants came here under reciprocal arrangements, while 1,087 immigrants were sent back to France.

A spokesman for the Department of Health and Social Care, which administers IHS payments on behalf of the Home Office, said: ‘We took immediate action to stop any further incorrect payments.

‘Enhanced checks and controls are now in place to prevent this from happening again and we are working across government to protect public money.

‘This had no impact on frontline NHS services or patient care.’

The Ministry of Internal Affairs was contacted for opinion.