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Almost 42,000 asylum seekers are waiting for an appeal hearing after the Home Office rejected their initial claims, according to analysis of official figures.
The Refugee Council said the number is a five-fold increase in two years and the government risks simply moving the asylum crisis from one part of the system to another, with almost 40,000 migrants still housed in hotels.
The Home Office said it had doubled the number of asylum seekers receiving an initial decision on their claim and allocated funding for more sitting court days.
A spokesperson said the government remains determined to end the use of asylum hotels over time and cut the "unacceptably high" costs of accommodation.
The Refugee Council said more asylum seekers' claims are being refused due to legislation introduced by the previous Conservative government, which made it harder to prove genuine refugee status.
After the government enacted the Nationality and Borders Act, only four in 10 Afghans were given permission to stay in the second half of last year. Previously, almost all Afghans asking for sanctuary were granted asylum.
Many of those rejected are thought likely to be appealing the decision. Currently, Afghans make up the highest nationality accommodated in hotels and those arriving by small boats in the last two years.
The chief executive of the Refugee Council, Enver Solomon, has called for better and fairer decision making.
"Right first-time decision making will ensure refugees are given safety to go on to contribute to communities across the country and those who don't have a right to stay in the UK are removed with dignity and respect," he said.
The charity points out that those in the appeals backlog still require accommodation and warns that, without improvements, the potential cost of hotels could be £1.5bn this year.
A government spokesperson said: "The asylum system we inherited was not fit for purpose, which is why we are taking urgent action to restart asylum processing and clear the backlog of cases, which will save the taxpayer an estimated £4 billion over the next two years."
It is allocating funding for "thousands more sitting days in the Immigration and Asylum Chamber to streamline asylum claims and improve productivity," the statement added.
Statistics from the Ministry of Justice show that at the end of 2024 there were 41,987 asylum appeals in the court's backlog, up from 7,173 at the start of 2023.
The Refugee Council's analysis suggests the total number of asylum application appeals lodged last year was a 71% increase on 2023.
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