A property company being paid millions of pounds in public money to provide homes for asylum seekers is set to lose control of their management - but says it is not the result of complaints.

Orchard & Shipman has managed the £221 million Home Office contract to provide "safe, habitable homes" for asylum seekers in Scotland and Northern Ireland on behalf of international service company Serco since September, 2012.

But Serco has confirmed it is looking to take control from O&S and is seeking "the best way to continue to deliver housing services for asylum seekers."

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The move just over a week after representatives of O&S and Serco were summoned before MPs on the home affairs committee over claims that asylum seekers were being mistreated and housed in substandard conditions.

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Secro are involved in discussions with  O&S (Glasgow) Ltd which give it operation control of the provision of the 4,700 asylum seekers in Scotland and Northern Ireland.

The 60 O&S staff would become Serco employees, once due diligence over the transfer is successfully completed.

Orchard & Shipman say the move is a "business decision" and has nothing to do with any complaints over the treatment of asylum seekers.

The Scottish Refugee Council have said there needs to be a shake-up over how refugees in Scotland are provided with housing that properly recognises the vulnerabilities of people "and provides the support they need and deserve".

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Graham O’Neill, the council's policy officer said: "We welcome any move that simplifies the complex housing supply chain for asylum accommodation in Scotland. If the result of this transfer is to provide greater clarity and accountability around who is responsible for this essential public service then that can only be a positive step."

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The number of asylum seekers being accommodated in Glasgow alone has risen dramatically from 1,668 in 2012 when the contracts began, to 2,769 in September, last year - an increase of 66%.

"The situation with asylum accommodation in Glasgow can’t go on as it is," added Mr O'Neill. "We’ve heard too many horror stories of people being treated unfairly and put up in substandard flats.

"These are people who have lived through terrible experiences in their home countries and who have had to flee their own homes in fear for their lives."

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Julia Rogers, Serco’s immigration managing director, said: “We are entering into initial discussions and due diligence with a view to transferring these operations to Serco.

"We are committed to providing decent and safe accommodation for the 4,700 asylum seekers in our care in Scotland and Northern Ireland and to ensuring that we will meet our obligations under the...contract.”

Chris Shipman, Orchard & Shipman chairman added: “Orchard & Shipman has worked increasingly closely with Serco as the service for asylum seekers has developed over the past four years on what has been a challenging contract.

HeraldScotland:

"It is now clear that it would make sense for the service to be directly delivered by the same provider in Scotland and Northern Ireland as well as North West England.

"I am confident that this move would be to the benefit of the people in our care and to our employees in Glasgow and Northern Ireland, who do a tremendous job."

Mr Shipman the home affairs committee that the bulk of the allegations had been made by a single disgruntled employee.

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Susan Munroe chief executive of Freedom from Torture told MPs reports from their clients indicated issues with accommodation were worse in Glasgow than any other parts of the UK.

Rupert Soames, chief executive of Serco has said he insists that the contract is actually working very well with accommodation that met Home Office standards.