Purchase of the Northeye site for asylum accommodation did not meet minimum standards

• Government chose to dispense with some established processes to acquire the Northeye site for asylum accommodation at pace, leading to increased costs.
• Home Office lacked in-house expertise to quality assure decisions during purchase of the site.
• Northeye site was ultimately deemed unfit for its intended purpose due to contamination.

The Home Office's quick acquisition of a new site for asylum accommodation, to meet government's priority at the time to end the use of hotels for that purpose, led to it cutting corners and paying more than it needed to, according to a new National Audit Office (NAO) report.^1,2

After first being alerted in May 2022 to its potential suitability, the Home Office entered negotiations with the vendors to acquire the Northeye site in Bexhill-on-Sea, East Sussex.^3,4 The Home Office moved quickly and chose to dispense with established processes, including the requirement for a full business case before approving the purchase.

A full assessment of the remediation required on the site did not take place either, despite significant risks being flagged. The cost of remediation was underestimated before contracts were exchanged, committing the Home Office to the purchase.

The Home Office also underestimated the time it would take between exchanging contracts and completing the purchase, leading it to pay the vendors an additional £0.9 million. As a result, it purchased a contaminated site for £15.4 million, with remediation costs estimated to be in the range of £1.1 million to £3.6 million.

During the purchase, the Home Office rejected offers of expert advice from other parts of government, relying instead on contracted staff but without putting in place sufficient oversight. There was limited reference to the potential scale of contamination or the need for further investigation in key decision-making documents, resulting in poor decisions.⁵

In response to lessons learnt from the purchase of the Northeye site, the Home Office has made improvements. A review by the Infrastructure and Projects Authority in March 2024 found that the Home Office's asylum accommodation programme now had firmer foundations, realistic ambition and more deliverable plans, upgrading its rating from 'red' to 'amber'.⁶

Read the full report

Investigation into the acquisition of the Northeye site for asylum accommodation

Notes for editors

1. Our report is factual and sets out the timeline of events leading to completion of the acquisition, and subsequent events; the process to acquire the site followed by the Home Office; and how this process differs from standard practice.
2. Our March 2024 report, Investigation into asylum accommodation, examined the increased demand for asylum accommodation over recent years and how the Home Office had responded.
3. The Home Office is responsible for asylum and protection in the UK, including providing financial support and accommodation while it determines asylum claims.
4. After initially intending to lease it, in December 2022 the Home Office decided to acquire the Northeye site through purchasing it outright from the vendors.
5. The Planning Appraisal completed in February 2023 highlighted contamination across the site as a high risk. A geo-environmental review undertaken in February 2023 concluded that the primary contamination risk was from asbestos-containing materials in existing buildings and contaminated ground. It recommended supplementary investigation to further understand the risks and before establishing the cost of remediation. The technical due diligence report published in the same month also indicated that repairs to buildings on the site could incur significant cost. However, this did not feature in the Home Office's internal Accounting Officer Advice.
6. The Home Office originally intended to develop the Northeye site for use as non-detained accommodation for single adult males seeking asylum. In May 2023, it concluded that the site was unsuitable for the non-detained asylum accommodation programme and moved the site to the programme for detained accommodation. In July 2024, the Home Office announced that no decision has been made on the use of the Northeye site and that it will consider its strategy and broader requirements before taking a view on the future use of it.