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

Building Compliance & Reactive Works Manager

East Devon District Council
£36,363 - £42,839
We have an exciting opportunity for a Building Compliance & Reactive Works Manager to join our Buildings and Facilities Management Team. Devon
Recuriter: East Devon District Council

Programme Director – Local Government Reorganisation

Staffordshire County Council
£Competitive
Lead one of the most significant local government transformation programmes in England! Staffordshire / Stoke on Trent
Recuriter: Staffordshire County Council

Executive Director – Place and Prosperity

South Derbyshire District Council
£106,484 up to £115,687 plus an essential car user allowance is also paid.
We are seeking an exceptional Executive Director to help shape the future of South Derbyshire at a pivotal moment in its history. Swadlincote, Derbyshire / Agile
Recuriter: South Derbyshire District Council

Music Centre Instructor

North Yorkshire Council
£22,601 to £35,259
Skipton Music Centre is a lively Saturday morning centre, providing musical learning for children and adults across a range of instruments and genres. Skipton, North Yorkshire
Recuriter: North Yorkshire Council

Wellbeing and Personal Development Lead

North Yorkshire Council
£38,220 to £42,839 per annum
Help Transform Lives Through Wellbeing, Personal Development and Inclusion North Yorkshire / countywide
Recuriter: North Yorkshire Council
Linkedin Banner