An asylum hotel provider has made over £180 million in profits since being handed a lucrative government contract worth billions in taxpayer cash.

Clearsprings Ready Homes was one of three firms assigned a 10-year contract to provide short-term housing for asylum seekers while they wait for their cases to be heard in 2019, including at the Britannia International Hotel in Canary Wharf.

The British firm is expected to rake in around £7 billion in taxpayer money as part of the contract, which applies to accommodation in England and Wales and will expire in 2029.

However, since taking on the commitment, Clearsprings has paid its parent company £183 million in dividends, according to the BBC.

Combined with the two other providers housing migrants around the country, Clearsprings has made £383 million in profits from the contracts, data from the National Audit Office shows.

Outrage at the large sums earned by the companies follows reports of “terrible” hotel conditions, with non-profit groups including Good Jobs First alleging that poor hygiene, nutrition and a lack of basic supplies are rife at the sites.

An open letter written by 60 charities suggested that Clearsprings is “paying as little as possible to the suppliers and taking as much as they can in profits”. It added that the government’s ongoing agreement with the firms meant “millions in public money … is being taken in profit by a handful of private companies”.

A spokesperson for the government said it had reduced the asylum backlog by 24%, returned 35,000 people who had no right to be in the UK and slashed migrant hotel spending by over half a billion pounds since winning last year’s election.

“We commissioned an audit to review the performance of our suppliers, to get the best possible value for taxpayers’ money. Five contracts exceeded their agreed profit-sharing thresholds, and their excess profits are being returned to the Home Office,” they added.