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.’

Skills Pipelines: What local government needs to know image

Skills Pipelines: What local government needs to know

Councils and mayors are to be handed a central role in developing skills pipelines for local industries, as the Government unveils what it calls a ‘fundamental change’ to the education system aimed at tackling youth unemployment. Here's what council leaders and officers need to know.
SIGN UP
For your free daily news bulletin
Highways jobs

Principal Highways and Transport Planning Officer

West Northamptonshire Council
£49,587 - £52,860
The Highways and Transport Team delivers essential statutory services relied upon by all residents of West Northamptonshire. Northampton, Northamptonshire
Recuriter: West Northamptonshire Council

Family Hub Business Support Officer

The Royal Borough of Kensington & Chelsea Council
Up to £34359 per annum
Help keep vital family services running smoothly and create a welcoming space for local families.As a Family Hub Business Support Officer, you'll prov England, London, West End
Recuriter: The Royal Borough of Kensington & Chelsea Council

Senior M&E Engineer (Waste & Gas) - Harlow District Council

Essex County Council
Up to £450.0000 per day
Senior M&E Engineer (Waste & Gas) - Harlow District CouncilLocation, HarlowFull time, Temporary 12 Months Contract £350.88 PAYE / £450.00 Umbrella per England, Essex, Harlow
Recuriter: Essex County Council

Council Tax Administration Officer

London Borough of Richmond upon Thames and London Borough of Wandsworth
£30,225 - £36,969 approx. depending on experienc
The role

Recuriter: London Borough of Richmond upon Thames and London Borough of Wandsworth

ONE Housing Applications Manager

The Royal Borough of Kensington & Chelsea Council
Up to £53076 per annum
Lead the systems that support our housing services - and the residents behind them.You'll play a key role in shaping the systems that help our housing England, London
Recuriter: The Royal Borough of Kensington & Chelsea Council
Linkedin Banner