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Government to pay £2.3m of borough’s asylum children’s costs

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The Home Office will pay an additional £2.3million to Croydon this year to cover the rising costs to the borough of being a first stop in this country for unaccompanied asylum-seeking children.

Safe haven: the Home Office has agreed that Croydon takes an unfair share of unaccompanied asylum-seeking children

The cash-strapped borough last month threatened to copy Kent County Council by refusing to accept the responsibility for new arrivals, as Dover and Croydon carry extra burden compared to other local authorities because of their status as immigration points.

The Home Office has a migrants’ registration office at Lunar House in Croydon town centre.

In the past decade Croydon has looked after more than 5,000 UASCs, including many vulnerable children. Council estimates put the additional cost to Croydon at £50million over the last 10 years.

The costs of looking after UASC is supposed to be met by central government, with local authorities across the country stepping in to take their share of new arrivals under a national transfer scheme. But the scheme is voluntary, and most councils swerve this obligation.

According to official statistics, in July 2021, Croydon was host to 156 UASCs, as well as 477 older care leavers who arrived unaccompanied. Croydon’s government-agreed quota should see the borough looking after no more than 66 UASCs. The high numbers of UASCs arriving in Croydon caused the council “an unreasonable and unsustainable financial burden”, according to a senior Labour councillor.

Cost centre: Lunar House in Croydon handles 10 per cent of the country’s unaccompanied asylum-seeking children

At last month’s Town Hall cabinet meeting, Hamida Ali, the Labour-controlled council’s leader, said that “all options are on the table” in order to plug a £2.357million hole in the children’s services budget, including laying off social workers and triggering “unsafe” caseload rises.

Without immediate government funding, Ali said, Croydon would “have no choice… including having to confront stopping to support new unaccompanied asylum-seeking children and young people”.

Ali made her remarks just as the United States-backed government in Afghanistan was collapsing, prompting the emergency evacuation of thousands of civilians, many of them, including UASCs, likely to seek asylum in Britain.

An immediate crisis in Croydon over asylum-seeking children appears to have been averted, though, when a council meeting last night was informed that the Home Office had agreed to provide £2.3million in funding this year.

There has been no formal announcement of the settlement, either from Whitehall or from Fisher’s Folly (where the council is in any case currently constrained over the kind of public statements it is able to make during a month-long purdah period before October’s governance referendum).

However, according to Sean “No Scrutiny” Fitzsimons, the Labour chair of the scrutiny committee, much of the credit for persuading the Home Office to cough up goes to Robert Ward, the Conservative councillor who chairs the children’s services scrutiny sub-committee. Ward and council officials, Fitzsimons tweeted last night, “have done an amazing job in putting a strong case forward to the Home Office”.

The breakthrough in funding is not a permanent solution, with the payment only for the 2021-2022 financial year. But it may create a precedent of the Home Office accepting that it needs to make a larger contribution to the costs it creates by being based in Croydon.

As Fitzsimons said, “Croydon has spent millions supporting what is a national service and a permanent solution is now needed.”

Deal-broker: Robert Ward

According to a Katharine Street source, Ward’s approach was to avoid “just blaming the government”, a strategy used by Fitzsimons and his bosses – including the discredited ex-leader Tony Newman and finance chief Simon Hall – for nearly eight years without any success.

Ward, a retired former oil company executive, also drilled down into the numbers to reduce or eliminate some of the UASC costs which the council was paying.

According to the source, he discovered that while some former UASCs were eligible for housing benefit or Universal Credit, Croydon Council was picking up the tab rather than getting them on to government benefits.  That now seems likely to stop, while the government has agreed to cover some other council costs, such as the age assessment team, and will provide an increase in the allowance for under-18s.

But what the Tory government gives with one hand, they are taking away with the other.

The council’s new finance director, Richard Ennis, told last night’s scrutiny committee meeting that Boris Johnson’s hike of National Insurance by 10 per cent is going to cost the council at least £1.25million per year.

“It’s madness to penalise social care providers like Croydon,” Fitzsimons said.


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