Joshua Nevett,Political reporterand
Paul Seddon,Political reporter
Families of failed asylum seekers will be offered up to £40,000 to leave the UK under a trial scheme announced by Home Secretary Shabana Mahmood.
Mahmood said the government would seek to forcibly remove failed asylum seekers if they do not accept “incentive payments” of up to £10,000 per person, capped at four per family, within seven days.
The scheme is expected to target about 150 families living in taxpayer-funded accommodation, and the Home Office estimates it could save £20m if successful.
However, the Conservatives and Reform UK said the payments would incentivise people to come to the UK illegally.
Mahmood unveiled the scheme as she sought make the “Labour case” for restricting support to some asylum seekers in a speech to a left-leaning think tank on Thursday.
The government already runs a voluntary returns programme, under which asylum seekers who choose to leave the UK can receive up to £3,000 in financial support.
Mahmood said housing a family of three in asylum accommodation costs up to £158,000 per year.
The home secretary said the UK government wanted to offer an “increased incentive payment” that will represent a “significant saving to the taxpayer”, in an echo of reforms introduced in Denmark.
Mahmood said the government was consulting on how to remove families with children who refuse to leave voluntarily “in a way that is humane and effective”.
She argued that not removing families had created “a perverse incentive” to cross the Channel with children.
Refugee and Migrant Children’s Consortium, a coalition of 100 organisations, said families would have “just a week to make a potentially life-changing decision” without “time to access legal advice”.
The group also raised concerns that cutting support for families would leave children homeless.
Conservative shadow home secretary Chris Philp said the payments were “an insult to the British taxpayer”.
Reform UK has also suggested financial incentives for voluntary deportations, but the party’s home affairs spokesman Zia Yusuf said £40,000 payments were “staggering” and “a prize for breaking in illegally”.
A government source argued the payments would not encourage people to come to the UK illegally, saying smugglers charged between £15,000 and £35,000 per migrant, so it would cost more for someone to travel here.
In 2025, there were 82,100 applications for asylum in the UK, relating to 100,600 individuals. Of those, 58% of those applications were refused.
There were 28,004 voluntary returns in the year to December 2025, an increase of 5% on the previous 12-month period.
In her speech, Mahmood also announced that asylum seekers who break the law, or work illegally, will be thrown out of government-funded accommodation and lose their support payments.
Under changes due to take effect in June, the government will limit accommodation and support to “those who genuinely need it”, although it is yet to set out in detail how this will work.
The Conservatives said Mahmood should go “much further”, while the Green Party has accused her of echoing the rhetoric of the far right.
However, the Refugee Council charity warned the plans could lead to an uptick in rough sleeping, shifting costs to local councils and the NHS.
Her speech is a pitch to those in her party who are sceptical of her approach, with Mahmood emphasising that her changes would make the asylum system “compassionate but controlled”.
Some left-wing Labour MPs are calling for the government to change its approach on migration in the wake of the party’s defeat to the Greens at last week’s by-election in Gorton and Denton.
About 100 Labour MPs have signed a private letter to the home secretary expressing concerns about her plans to make refugee status temporary.
The letter argues the move would undermine “integration and cohesion” by opening up the possibility of removing refugees who have lived in the UK for as long as 20 years.
But in her speech, Mahmood argued that “restoring order and control at our border is not a betrayal of Labour values, it is an embodiment of them,” and insisted the majority of Labour MPs supported the changes.
Mahmood used the speech to step up her attacks on the Greens, accusing the party of wanting to create “a world without borders” and calling for “the most expensive and expansive migration policies anywhere in the world”.
A Green spokesperson said the home secretary was “deliberately misrepresenting Green Party policy”.
The Green Party said it recognised “the great contribution that migrants and refugees make to British society and we want to see policy that treats everyone with dignity rather than treating them harshly for political gain”.
Mahmood also criticised Reform UK, which she said would oversee a “nightmare” of “pulling up the drawbridge and shutting out the world” if the party was in government.