In December 2022, then-prime minister Rishi Sunak delivered a statement in Parliament in which he vowed to end the use of hotels to house asylum seekers, saying that the government would “work to achieve this as quickly as possible”.
In its report, the NAO said the statement “generated significant pressure within the Home Office to identify and secure sites for asylum accommodation at pace”.
It added that, the following January, a decision to acquire Northeye was taken by a small group of ministers and officials from across Whitehall, despite the “technical due diligence and approvals process not having been undertaken”.
The group included the minister for immigration and the chancellor of the Duchy of Lancaster, the report said, positions then held by Robert Jenrick and Oliver Dowden.
In February 2023, an environmental review identified a contamination risk from “asbestos-containing materials in existing buildings and contaminated ground”, while a due diligence report assessed conditions at the site as “high risk”.
The diligence report also estimated the cost of repairs to buildings at the site to be £20m, although this figure was not included in advice later submitted to ministers.
The following month, Jenrick announced that Northeye would be developed to house 1,200 people, and the sale was completed in September 2023.
The final price paid for the site was £15.4m, including £0.9m paid to the vendors – Brockwell Group Bexhill LLP – because the Home Office had underestimated how long it would take to complete the purchase.
Brockwell had bought Northeye in August 2022 for £6.3m.
The costs of remediation because of the contamination at the site were estimated to be between £1.1m and £3.6m.
The NAO concluded that the Home Office’s attempt to acquire Northeye “within just a few months… led it to cut corners and make a series of poor decisions”.
“This resulted in it purchasing a site that was unsuitable for [its] original purpose, and it paying more for it than it needed to.”
