William Eichler 07 April 2017

'Dangerous rogue landlord benefit scam' costs taxpayer millions

Council chiefs are calling on the Government to close a loophole in the law which enables rogue landlords to carry out a dangerous and costly housing benefit scam.

The legal loophole allows landlords to convert properties into multiple tiny ‘units’. These ‘micro-conversions’ are marketed as self-contained flats, which helps the landlord to secure the maximum level of housing benefit payments.

The Local Government Association (LGA) warned this is a ‘scam’ and described it as an abuse of taxpayers’ money.

Figures show private landlords pocketed £9.3bn in housing benefit in 2015, twice that of £4.6bn in 2006, and it is thought this micro sub-division of properties - called the Lockdown model - has contributed to this sharp rise.

The LGA also said these rogue landlords were housing tenants in poor and often dangerous accommodation.

Landlords can convert homes into a maximum of six small self-contained studios with en-suite showers and portable cooking equipment, without planning permission.

However, the electricity supplied to the different properties is often run on stolen meters or hotwired supplies, creating fire hazards.

Thanks to new Government legislation, councils will be able to issue landlords with fines up to £30,000. They will also be able to apply for ‘banning orders.’

This does not go far enough however, the LGA said. Councils should be able to jail offenders. They should also have streamlined housing and planning powers to stop landlords converting properties into ‘micro flats’ without planning permission.

‘No landlord can act outside the law and councils will do everything in their powers to ensure tenants can live in rented properties safe in the knowledge that local authorities are there to protect them,’ Cllr Judith Blake, LGA housing spokesperson.

‘However, the reputations of all good landlords are being tarnished by the bad ones and councils are being let down by the current system. Legislation is not keeping pace with the ingenuity of landlords to exploit loopholes which need to be closed as soon as possible.’

SIGN UP
For your free daily news bulletin
Highways jobs

Data Architect

Essex County Council
£62461.0000 - £73483.0000 per annum
Data ArchitectPermanent, Full Time£62,461 to £73,483 per annum Location
Recuriter: Essex County Council

Social Care Officer

Sandwell Metropolitan Borough Council
Band E, SCP 18-25 (£31,537 – £36,363 per annum)
Make a Real Difference Every Day! Sandwell, West Midlands
Recuriter: Sandwell Metropolitan Borough Council

Housing Hub Officer

Sandwell Metropolitan Borough Council
Band D, SCP 9 -17 (£27,254 - £31,022) per annum
Have you got a passion for giving excellent customer service? Sandwell, West Midlands
Recuriter: Sandwell Metropolitan Borough Council

Substance Use Practice Advisor

Durham County Council
Grade 11 - £40,777 - £45,091
Are you a practitioner with experience of working with families affected by drug and/or alcohol use, delivering substance misuse interventions, and of Durham
Recuriter: Durham County Council

Emotional Wellbeing Practice Advisor

Durham County Council
£40,777 - £45,091
Are you a practitioner with experience of supporting children and families where emotional distress, attachment difficulties, neurodevelopmental needs Durham
Recuriter: Durham County Council
Linkedin Banner