A security contractor that supplies the Manston detention centre has been handed an extension to a Home Office contract despite criticism that asylum seekers may have faced “inhuman and degrading treatment” at the facility.

Management & Training Corporation (MTC), an outsourcer, said it has signed a one-year deal in June to provide services at the detention centre in Manston, Kent, until July 2024.

MTC said it has 211 staff at the scandal-hit facility in a variety of roles including security, helping medical teams deliver assessments and operating some of the residential units.

It is a four-fold increase from the 50 staff who moved from working in asylum hotels in the Midlands to work at the detention centre last year on a separate rolling contract.

The processing facility, which handles asylum seekers who come across the Channel in small boats, has been the subject of multiple controversies.

In autumn last year the centre, which is supposed to hold 1,600 people, became dangerously overcrowded after numbers rose to 4,000. This prompted outbreaks of violence and the spread of infectious diseases such as diphtheria.

A delegation from the Council of Europe’s prevention of torture and inhuman or degrading treatment or punishment committee visited the site in November and concluded in a report that asylum seekers may have been subjected to “inhuman and degrading treatment”.

In June, David Neal, the independent chief inspector of borders and immigration, warned there was a “real danger” the dire conditions experienced by residents at the detention centre in autumn could return.

The Home Office later attracted criticism after spending £1,500 of taxpayer money painting over cartoon murals to welcome children at the detention centre.

The government is scrambling to find accommodation for thousands of asylum seekers, including a scheme to house them on the Bibby Stockholm barge as part of Rishi Sunak’s flagship “stop the boats” policy.

MTC, which is owned by a US private prison provider, has previously attracted criticism over its running of Rainsbrook secure training centre, near Rugby, as part of a £50m deal with the Ministry of Justice (MoJ) in 2016.

An Ofsted inspection report found “serious concerns” on its visit in October 2020 and said that children were being locked up for 23.5 hours a day during the pandemic with “no justifiable rationale”.

A later report said there was a “volatile culture” at the centre, where children carried weapons and told inspectors they felt “anxious or unsafe”. Staff said they had concerns that a child or adult could die due to the poor practices at the facility.

Children were subsequently removed from the centre in July 2021 and the contract between MTC and the MoJ was terminated by mutual consent.

The accounts for its UK operations, filed at Companies House, said that in 2021 MTC signed a contract with the Home Office to run two “migrant quarantine hotels” in the Midlands.

The contract was amended in June 2022 so that staff could be moved to Manston, before the new contract with the Home Office was agreed in June 2023. Several outsourcers, including Mitie and Interforce, also provide staff to Manston.

The accounts also reveal that the firm made a £5.6m loss after tax in the year ending 31 December 2021. This compared to £11m in profit the firm made in 2020 – the same year it was running the Rainsbrook secure training centre.

A Home Office spokesperson said: “All commercial contracts are designed to ensure the best value for taxpayers and we closely monitor contractor performance, including financial results.”

A spokesperson for MTC said: “The consolidated accounts for our work in the UK during 2022 show a loss of £5.6m reflecting our reduced operations and costs associated with maintaining and investing in our UK business.” They added: “The Council of Europe’s report found no allegations of ill-treatment or other indications of malpractice from colleagues at Manston and observed a caring and professional attitude. The challenges the council reported related to the number of people at the centre. The wellbeing of vulnerable people we look after is our priority and we are committed to ensuring safe and decent conditions for all those in our care.”

• This article was amended on 30 August 2023 to add a comment from MTC in relation to the Council of Europe report.