Welsh Conservatives on Powys County Council have accused the authority’s Liberal Democrat and Labour-led cabinet of “abandoning residents” over its involvement in a Home Office asylum dispersal pilot scheme.

The criticism follows the council’s decision last year to submit a non-binding expression of interest in the scheme, which could see homes leased to the Home Office for up to 10 years to accommodate people seeking asylum, before being returned to the council’s wider social housing stock.

Newtown West Conservative councillor Pete Lewington said residents had raised “grave concerns” with him about the proposals and their potential impact on local communities.

“The UK Labour government is sending the wrong message to the evil people smuggling gangs and I am afraid the Liberal Democrat cabinet have compounded that huge error by agreeing to participate in this scheme,” he said.

Cllr Lewington said the proposal risked encouraging further demand and said he feared it would allow “illegal immigrants to jump the queue for housing”, adding: “That’s not fair on our residents.”

“Whilst I support properly organised asylum schemes such as the Ukrainian scheme where people’s lives were genuinely at risk, I can’t support any scheme that houses people who have entered our country illegally and subsequently claim asylum,” added Cllr Lewington. “They must be removed quickly and their claims processed via a third country.”

Conservative group leader Cllr Aled Davies said: “With Powys County Council having thousands of its own residents on its housing waiting list and an increasing level of homelessness, this is not the time to get involved in such schemes.

“This does not provide much needed housing for our residents now, and I’m not sure it will do so in 10 years’ time.”

He said “deterrents not incentives” were needed for those attempting to cross the Channel, urging the cabinet to withdraw their expression of interest in the scheme and “focus its energies on our residents first and foremost.”

Responding, Labour’s Cllr Matthew Dorrance, deputy leader of the council, rejected claims that the cabinet had abandoned residents.

“The answer is a resounding no,” he said.

“Since we have been in office we have been busy getting new council homes built, new school building plans developed, reducing homelessness and transforming social care to deliver better outcomes for people, driving up recycling, working towards net zero and producing an ambitious plan for growth that will tackle poverty and deliver prosperity.”

He then accused the Tories of “clinging to a crumbling party desperate for a cheap headline.”

When the pilot was raised in a cabinet meeting last summer, members were told that taking part in the pilot would give Powys greater control over where asylum seekers are placed, compared with the current system in which accommodation is sourced directly by the Home Office.

The cabinet also heard that any homes developed through the scheme would have no impact on people currently on the housing waiting list and would be added to Powys’ social housing stock at the end of the lease period.