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Gary Younge
These few who reached our shores for help face bureaucratic oblivion

At the Refugee and Migrant Justice centre in east London, people's fates lie strewn across the office, bound up by elastic bands in folders stacked on desks, stuffed in boxes or in piles on the floor. Each bundle represents a person, almost by definition a vulnerable person, attempting to navigate a labyrinthine system specifically designed and refined to exclude them. Each one contains potentially life and death information – documents, testimony, research and witness statements – that could make the difference between deportation and the right to remain. Barring intervention – legal, political, moral or financial (or possibly a mixture of all four) – by Wednesday, many of these files will be carted out of the door by receivers and cast into bureaucratic oblivion. Units of human misery about to become emblems of institutional neglect.

For the centre, which represents about 10,000 asylum seekers a year, was forced into administration on Wednesday. Less than a week ago these files were arranged in alphabetical order by case workers with detailed knowledge of their clients' stories; now they are being rearranged at great haste to be hauled away by administrators and, theoretically at least, reallocated to companies unknown.

That is the best-case scenario. Those who work here fear the worst. "The reality is that many of our clients will never see these files again," explains a Unite union representative at the centre, who didn't want to be identified. "We can't write to them explaining what has happened because we're not being told ourselves. The idea that files won't get lost is ludicrous. The majority of our clients can't speak English. Often they are given just a few days to respond or appeal to a decision. They're going to receive a letter they don't understand from people they don't know. Potentially people could get deported." If the administrators had their way, you wouldn't hear about it either. Last week as interest in the story grew, they ordered an end to the media coming into the building.

The centre's problem isn't that it does not meet a need and cannot provide for it, but that the government recently refused to pay for it properly and in a timely fashion. Whereas it used to receive legal aid paid at an hourly rate, it now receives a flat fee only once a case is finished. This is a result of Lord Carter's recommendations to "marketise legal aid", which were introduced in 2007.

The trouble is, while there is plenty of money to be made in trafficking and the privatised incarceration and deportation of asylum seekers, there is relatively little profit to be derived from representing their rights, as laid down by international law. Their cases are difficult and take a long time. The system moves slowly and deliberately – sometimes for good reason, sometimes through inefficiency. Many firms have stopped taking "difficult" asylum work because it simply doesn't pay. The RMJ isn't one of them.

So the centre is paid far less than it was, far slower than it used to be – and a great deal of that has not even been paid. They have been surviving on 40% less per client than they once did. And they are good at what they do. In 2008-09, the RMJ won 36% of initial asylum applications (one-third higher than the national average) and more than 50% of appeals (double the national average). It has established important case law in a number of areas from Zimbabwe to Iraq. "Far from saving money, allowing an organisation like the RMJ to decline will cost the government more money because they are losing a quality service provider," explains July Bishop, director of the Law Centres Federation.

The charity says the government owes it £2m for work it was contracted to do. Now it cannot make the rent. The staff got their June pay cheques early, the first sign that something was seriously amiss, but it may be their last. The justice secretary, Ken Clarke, blames the RMJ. "It's not a question of late payments," he told MPs last week. "Refugee and Migrant Justice was paid what was due, but they did not make the efficiency saving that other providers did."

This is simply untrue. A government report in June 2009 revealed: "Many providers told us that they had experienced severe cash-flow problems since the commencement of the fixed fee scheme." While "some providers [said] the system of fixed fees is creating 'perverse incentives' – encouraging behaviour which is not in the best interest of vulnerable clients". A survey by the LCF in 2008 revealed that in the wake of the introduction of the fixed-fee system, almost one in five law centres was threatened with closure and almost a half (49%) were in serious debt. "These difficulties aren't a matter of opinion. They are on public record at the ministry itself."

It's amazing under those conditions that the RMJ has been able to last as long as it has. These are modest people in modest buildings in London's East End. Nobody goes into asylum seeker and refugee legal work for the money. It has effectively been bankrupted by a state that finds its existence, let alone its work, tiresome and fears little outcry at its demise.

This is not a party political point. These changes came about as a result of policies ushered in by New Labour, borne of many years of pandering to populist demagoguery. Asylum seekers emerged during the mid-nineties as a confected scapegoat in the British polity – all the more easy to demonise since relatively few people had ever met one. "Minorities are the flashpoint for a series of uncertainties that mediate between everyday life and its fast-shifting global backdrop," writes Arjun Appadurai in his book Fear of Small Numbers. "This uncertainty, exacerbated by an inability of states to secure economic sovereignty in the era of globalisation, may translate into a lack of tolerance of any sort of collective stranger."

Framed as the global south's latest intrusive, plaintive and burdensome incursion in the west, they became cast as a category not only undeserving of protection under international human rights law but outside of humanity altogether. At a time when the borders went down between Europeans, the fortress went up to protect Europe against the world's poor.

The global reality, however, has long been exactly the opposite. With roughly 80% of the world's refugees in the developing world, the international obligation to house refugees falls most heavily on poor nations. Meanwhile, with almost half of refugees worldwide under the responsibility of the UN high commissioner for refugees from Afghanistan and Iraq, Britain has helped create far more refugees through war than it has taken in through compassion.

As the coalition government prepares to swing the axe in its budget tomorrow, this is worthwhile noting. Because what comes next represents a plot development in attacks on the vulnerable as opposed to a narrative step change. The Liberal Democrats had been one of the last parliamentary avenues for protest in situations like these. Now that they have been co-opted, no viable opposition to situations like this is going to emerge from within parliament.

If an organisation like the RMJ survives, it will be because the public rises to defend it. We must brace ourselves for a shift in scale and pace, but let us not fool ourselves that it marks a difference in kind. New Labour lit the torch, now George Osborne will turn up the heat.

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