- 160,000 tenants are renting properties to other people
- Those found guilty would also face fines up to £50,000
Last updated at 4:30 AM on 11th January 2012
Sub-letting council houses will be made a criminal offence with offenders facing up to two years in prison, it was reported today.
The Government has unveiled proposals to allow courts to impose prison sentences on sub-letters and fine them up to £50,000.
Abuse of social housing is estimated to cost the taxpayer more than £5billion a year.
Under the proposals, councils will be able to crack down on sub-letters on estates like this in Notting Hill, west London
However, it is not currently an offence to sublet a council house. Officials believe up to 160,000 tenants are renting properties to other people.
Housing Minister Grant Shapps said: ‘Tenancy cheats are taking advantage of a vital support system for some of the most vulnerable people in our society and getting away with a slap on the wrist while our waiting lists continue to grow. It’s time for these swindlers to pay the price.
‘It would cost us billions of pounds to replace the huge number of unlawfully occupied social homes across the country.
‘Meanwhile, tenancy cheats can earn thousands of pounds letting out their property, which was given to them in good faith and which could instead be offering a stable home to a family in need.
‘The proposals I’ve announced today would not only deliver justice to these fraudsters, but will also act as a deterrent to those who think they can earn a fast buck from this precious resource.
‘I want everyone to know that our country’s social homes are going to those in genuine need, not providing a ‘nice little earner’ to someone who could afford to live elsewhere.’
Housing minister Grant Shapps has revealed more details of plans to reform social housing
Experian examined data covering 125,000 properties run by 10 local councils and housing associations to try to detect potential fraud (sample picture)
The plans, being put out for consultation, would see the creation of a new criminal offence of tenancy fraud, with a maximum sentence of two years’ imprisonment and a fine of up to £50,000 if the case goes to crown court.
The money seized would be handed back to the social landlord in whose stock the fraud was committed, rather than going into government coffers.
Local authorities would also get stronger powers to investigate fraud, including easier access to data from banks and utility companies.
Researchers for information services company Experian estimated in September that almost 160,000 homes were being fraudulently sub-let in the UK -or three per cent of the nation’s five million social properties.
They examined data covering 125,000 properties run by 10 local councils and housing associations to try to detect potential fraud.
They also looked at tenancy lists, and then compared the registered tenant’s credit activity and which address it was associated with.
The researchers also examined credit activity by other adults who were using the council or housing association property as their address.
The sublet properties could potentially be vacated and used for people in temporary accommodation, which costs around £18,000 per year per tenant according to Experian, or those who are on housing waiting lists.