Councils given £9.5 million to crackdown on social housing fraud

Mortgages and Home

Updated on 05 April 2013 | 7 Comments

Housing Minister wants to help councils weed out those that are cheating the social housing system.

Housing Minister Mark Prisk has announced a multi-million pound pot to support a council-led crackdown on social housing fraud.

The minister has reserved £9.5 million to help in the fight, which will be made available to 62 councils. You can see which councils will be getting a share and how much in this document (opens as a PDF).

Social tenants who live elsewhere and rent out their home to a third party for a profit are in the firing line. Prisk says they are denying homes to people genuinely in need and costing the taxpayer millions of pounds.

The scale of the problem

In 2012 the Audit Commission released a report called Protecting the Public Purse which revealed that around 100,000 social homes in England could be unlawfully occupied.

Currently there are about 1.8 million households that are waiting for a social house, while 250,000 existing social households are deemed to be overcrowded.

Fraudsters that live elsewhere and rent out their social home are thought to cost the taxpayer £900 million a year.

Criminal offence

At the moment social housing fraudsters risk losing little more than their tenancy if found out.

But the Government has backed a new Bill which makes sub-letting of social housing a criminal offence.

The Prevention of Social Housing fraud Act 2013 is due to come into force this summer.

The new law will mean social housing fraudsters could receive an unlimited fine and face up to two years' imprisonment, while councils will be able to take the proceeds made from sub-letting.

The law will also make it easier to detect social housing fraud, giving local authorities more powers to investigate with access to data from banks and utility companies.

Cracking down

The teams that currently hunt out the fraudsters recover more than 100 local homes a year. In some cases their work uncovers even worse cases of benefit fraud.

With the extra funding, the councils should be able to ramp up this number with better specialist investigation teams and advance data matching, bringing more housing back into the stock for people that need it.

More on housing:

The hidden costs of retirement housing

Self-build: is it getting easier to build your own home?

Bedroom tax: concessions for foster carers, the military and the disabled

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