Landlords losing out thanks to previous Government

It has been revealed that over £220million is being stolen from taxpayers every year by tenants, in what is becoming an increasing housing benefits scandal. Tenants receiving housing benefits are routinely stealing the rent money which is worth hundreds of pounds, given to them by the state and which should be then paid to the landlords.

They are, however, being allowed to pocket the money for almost two months before the debt ridden landlord is able to insist that the money is paid directly to them instead of the tenant. The Coalition Government promised to end the controversial Local Housing Allowance that has created the scandal and which was brought in during the last days of the Labour administration. Tenants in council or housing association properties have the allowance paid directly to the local authority but for private tenants it is they who are responsible for paying the rent to the landlord themselves. This has led to thousands of tenants stealing the money. Landlords can not ask for the rent to be paid to them directly until the tenants are eight weeks in arrears. For most landlords an eviction attempt is not always practical due to the cost of legal fees. And despite having cheap landlord insurance, eviction is a last resort.

Minister for Welfare Reform Lord Freud said: “We have launched a major reform of the housing benefits system to make it fairer and to make sure that tenants are motivated to act responsibly. The current structure allows people to rent homes that most hard-working families cannot afford and cannot maintain upon moving into work. As part of the changes we are making to the system we will review the way payments are made and direct payments to private landlords.”

The Local Housing Allowance, started in April 2008, has been blamed for making it easy for people on benefits to live in luxury. Now, research shows, it has led to a large amount of people failing to pay their rent to the landlord in the knowledge that it is extremely unlikely they will be evicted.