The UK government is now facing a potential £100 million legal bill after the Rwandan government claimed that Labour mishandled the termination of a high-profile asylum agreement.
The dispute centers on a deal designed to move some asylum seekers from the UK to Rwanda—a plan now embroiled in international legal proceedings.
Rwanda Claims Delay Cost the UK Dearly
Officials in Rwanda have criticised Prime Minister Sir Keir Starmer’s handling of the agreement, highlighting that Labour only formally ended the Migration and Economic Development Partnership (MEDP) after Rwanda launched legal action last November.
Because of this delay, the deal technically remains in effect until March 16, leaving the UK open to financial claims.
Rwanda has now filed a case at the Permanent Court of Arbitration in the Netherlands, seeking compensation for what it considers breaches of the agreement.
Tories Blast ‘Catastrophic Incompetence’
Shadow Home Secretary Chris Philp was quick to attack Labour, calling the situation a clear example of “catastrophic incompetence.”
He said the government should be restoring the deal to send migrants to Rwanda instead of funding hotel stays across the UK.
Philp warned: “This bungling is leading to court cases and could cost taxpayers £100 million or more.
Labour has clearly mishandled this from start to finish, while migrants continue to cross the Channel.”
The Fallout From Ditching the Deal
Labour had pledged to scrap the Rwanda scheme shortly after taking office, with Sir Keir describing it as “dead and buried.”
However, Rwanda claims it was given no prior notice, which breached the spirit of the original partnership.
In November 2024, the UK asked Rwanda to forgo two payments of £50 million due in April 2025 and 2026, assuming the treaty would soon be formally terminated.
Rwanda was reportedly willing to accept this, provided new financial terms were agreed.
Negotiations, however, never took place, leaving the payments still owed.
Arbitration Claims and Financial Disputes
Rwanda plans to make three claims at the Hague-based arbitration court.
Two relate to alleged breaches of the financial terms of the MEDP, while the third concerns promises to resettle vulnerable refugees from Rwanda.
The East African nation said it was forced into arbitration because the UK refused to reconsider its position.
The Human Impact and Rising Costs
The abandoned Rwanda scheme was set to remove Channel migrants from the UK and house them in Kigali, where they could claim asylum.
Following Labour’s decision to cancel the plan, crossings by small boats from northern France surged.
Home Office data shows that by the end of September, 36,273 migrants were being housed in taxpayer-funded hotels—an increase of nearly 7,000 since Labour assumed power.
So far, the cancelled scheme has already cost the UK £715 million.
Legal Teams Representing Both Sides
Court documents named Rwanda’s Justice Minister and Attorney General, Dr Emmanuel Ugirashebuja, as the claimants’ representative.
The country has hired Lord Verdirame KC of London’s Twenty Essex Chambers.
On the UK side, Home Office Director for Migration and Borders Dan Hobbs is involved, with the government instructing barrister Ben Juratowitch from Essex Court Chambers.
A UK government spokesperson said: “We will robustly fight this in the courts to protect British taxpayers. The previous government’s Rwanda policy wasted vast sums of taxpayer money.”
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