Andy Burnham will tear up multi-billion-pound asylum accommodation contracts with private providers should he succeed Sir Keir Starmer as Prime Minister, allies of the Greater Manchester Mayor have claimed.
Mr Burnham is said to be "very committed" to terminating the arrangements with the three companies currently responsible for housing asylum seekers.
Break clauses within the decade-long contracts became available in March, giving the Home Office the option to renegotiate or cancel them entirely before their 2029 expiry date.
Under Mr Burnham's plan, local councils would take over responsibility for finding accommodation, with asylum seekers placed in dispersal housing such as bedsits and shared homes rather than hotels.
Andy Burnham is currently campaigning for the Makerfield seat as a way to re-enter Westminster
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That figure has since dropped by more than half, with 20,885 asylum seekers remaining in hotels at the end of March compared to 68,719 in dispersal accommodation.
Meanwhile, the National Audit Office estimates the ten-year cost has risen from an initial £4.5billion to £15.3billion.
Private contractors Serco, Mears and Clearsprings Ready Homes are permitted profits of up to 5 per cent under the arrangements signed in 2019.
Police outside The Bell Hotel | PA
Home Secretary Shabana Mahmood is not prepared to activate the break clauses despite agreeing the existing contracts are "terrible".
Ms Mahmood's position rests on the absence of viable alternatives, with Labour maintaining it can fulfil its manifesto commitment to end hotel usage by 2029 within the current framework.
Officials at the Home Office have expressed scepticism about whether councils possess the capability to secure the 100,000 beds needed for asylum seekers.
This assessment means the department will continue depending on private providers for the foreseeable future.
Andy Burnham is said to be looking at a route back into Westminster | PAThe Home Office has confirmed it has no intention of triggering the break clauses but remains committed to phasing out hotel accommodation before the contracts expire.
Whether Burnham would maintain Mahmood's policy of utilising large sites, including a former army training facility in East Sussex and military barracks in Inverness, is not yet known.
A spokesman for Burnham stated that he believed "hugely profitable outsourced contracts" was "not the basis for a fair asylum system".
"Andy stands by his view that the way dispersal has been handled has ridden roughshod over local communities and hit places like the northwest hard, forcing them to pick up the pieces, while outsourced companies profits surge. He's been clear that is not fair on communities here and needs to change," the spokesman added.
More than 195,000 migrants have crossed the Channel since the crisis started in 2018 | PAHowever, Mr Burnham appears to have performed yet another U-turn on the migrant crisis.
The Greater Manchester Mayor was incredibly critical of Ms Mahmood's proposal to change indefinite leave to remain and regularly review whether it might be safe for asylum seekers to be returned home.
He said: "I'm not going to say that the Home Secretary is wrong to call for this level of change.
"What I would say is it's really important, on the back of the measures that she's announced, that there is a considered debate, time is taken to see if consensus can be built around it. Because that would be hugely valuable to the country if that could be secured."