40% of the Housing Benefit Budget Is Spent on the Private Rental Sector

The Daily Mail has accused landlords of exploiting legal loopholes to rake in millions in housing benefit payments from tenants, whilst allowing them to live in sub-standard accommodation.

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The Dispatches program, which aired on Monday on Channel 4, showed how landlords operating in the private sector are now receiving around £9billion a year from the public purse.

Rogue Landlords Provide Poor Value for Money
200 individual landlords have each pocketed £1million in housing benefit payments. The majority of Britain’s landlords provide an excellent service. Their properties are well-maintained and tenants have no cause for concern. However, a small minority are happy to collect housing benefit payments from their tenants, despite the fact that the accommodation provided is in an appalling state.

Bedsits Attract More Housing Benefit Cash
A housing scheme in London has seen large houses converted into multiple tiny bedsits, each with a small shower room and the bare minimum cooking facilities. Opportunistic landlords have discovered that they can collect a higher rate of housing benefit renting these small units to tenants than they would if the property was let as a shared house.

Some councils are even offering landlords incentives to take on housing benefit tenants; such is the lack of available social housing. The Dispatches team film one letting agent boasting that he is paid up to £1,000 by his local authority to find suitable rooms for tenants claiming housing benefit.

Dr Victoria Cooper from the Open University has described the practice as a redistribution of wealth into the pockets of private landlords.