An additional pounds 30m is being put into central funds to compensate councils which agree to accommodate people. The aim is to relieve the pressure on places such as Dover and London, where some local authorities have been pushed to breaking point by the strain of supporting growing numbers of people coming in from abroad.
Jack Straw, the Home Secretary, said: "Asylum seekers often choose to join communities of similar ethnic origin and so head for London or remain close to port areas such as Dover. The strain on those councils most affected is unbearable and can no longer be sustained."
The scheme is a short-term measure while the Government pushes through legislation for a major shake-up in the immigration system. In the longer term, the Government is planning to take central responsibility for supporting asylum seekers financially, and to ensure that immigrants are spread out around the country.
Under the new measures, local authorities will be able to claim pounds 165 a week for each single adult housed, pounds 230 for a family and pounds 200-pounds 400 a week for unaccompanied children.
The announcement was welcomed by the Local Government Association (LGA) and the Association of London Government. LGA chairman, Sir Jeremy Beecham, said: "We are confident councils throughout the country will respond positively to this initiative."