Councils in Scotland are holding the government to ransom over asylum seekers by refusing to house any in their area unless the Home Office first hands over more cash.

So far all of the 3,000 asylum seekers north of the border have been placed in Glasgow, but with that council nearing capacity the government has written to 28 of the 32 Scottish local authorities informing them that they have been identified as potentially “suitable for asylum dispersal”.

However, talks between the Home Office and the authorities have effectively broken down, as the councils are refusing to take the migrants unless the government promises more resources, The Times has reported.

One local authority insider said: “The Home Office have effectively said to us, ‘There is nothing in this for you, but can you help us out anyway?’

“Everybody supports the idea of widening dispersal, but at a time when local authorities have got tens of millions of cuts to make, it’s a very, very tough ask.”

North Ayrshire was expected to be the first to sign up to the scheme, but it has now pulled back from agreeing terms, claiming that the Home Office wasn’t doing enough to help the council meet adequate standards.

A spokesman for the authority said: “Humanitarian protection is a key principle for the council and we will do whatever we can to help those who have been forced to flee their homes in search of safety.

“However, at this time we believe that the support offered to asylum seekers through the Home Office contract does not meet the standard we are already providing here in North Ayrshire.

“We are concerned that this could result in vulnerable people receiving differing levels of support around their wellbeing and integration. As a result, we have temporarily paused progression of this initiative while we explore with the Home Office how appropriate support can be developed.”

The authority already houses 63 Syrian asylum seekers under the Vulnerable Persons Relocation Scheme, which hands councils a grant of £8,500 per person.

Following the retreat of North Ayrshire, it is thought that no Scottish authority will commit to rehoming the asylum seekers before the local government elections in May, during which the Scottish National Party (SNP) is expected to gain control of a number of regional councils.

Commenting, the SNP-held Scottish government has restated its support of dispersal of asylum seekers across Scotland “in principle”, but added: “We believe that asylum seekers should be treated with dignity and respect and supported and integrated into our communities from day one.”

A spokesman for the Scottish Refugee Council has also backed North Ayrshire council in its decision, saying: “We share North Ayrshire’s concern about levels of Home Office support for people seeking refugee protection. These are people who have fled unimaginable horrors and are entitled to quality support in the crucial early days and weeks after their arrival in Scotland.”

The Home Office has declined to comment on North Ayrshire’s decision.

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