THOUSANDS of asylum seekers forced to live in UK hotels while their claims are being processed will have their daily allowance cut to £1.25.

The Government decision was quietly released by the Home Office last week in a move that refugee charities say will lead to more people seeking asylum dropping into extreme poverty.

The support payments, which were at £9.58 a week, will now be dropped to £8.86 in the new year with the roughly 50,000 people staying in these hotels waiting for their claims to be assessed also not allowed to work in the meantime.

Enver Solomon, the chief executive of the Refugee Council, told The Guardian that the change comes as asylum seekers are already “constantly struggling” to afford basic essentials like toiletries and paying to attend Home Office appointments.

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He said: “At a time when the cost of living is rising. This has a real impact on the mental health and wellbeing of men, women and children who are already coping with trauma and anxiety,” he said.

“With thousands of people waiting for a decision on their asylum claim, unable to work and forced to rely on the Home Office for everything, the payments should reflect actual need and be increased to a level that makes dignified living possible so people can support themselves and their families.”

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Dominic Raab, the former deputy prime minister, has previously said he would be “open-minded” about the idea of allowing asylum seekers to work while their claims are being processed.

Asylum seekers in self-catering accommodation, meanwhile, will receive an increase in their weekly allowance from £47.39 a week to £49.18. Pregnant women and families with children aged three and under will also see a slight increase.

A Home Office spokesperson said: “The level of the allowance given to individuals is reviewed each year to ensure it covers essential living needs. This year weekly allowances have increased for many, including pregnant women and young children.

“We continue to meet our legal obligations by providing support and accommodation for asylum seekers who would otherwise be destitute. “