Outrage as scroungers blow £220m in benefits

MORE than £220million is being stolen from taxpayers every year by feckless tenants in a growing housing benefits scandal, the Daily Express can reveal.

Benefit scandal sees 220million stolen from taxpayer Benefit scandal sees £220million stolen from taxpayer

Benefits scroungers are routinely stealing rent money worth hundreds of pounds given to them by the state to pay their landlords.

They are being allowed to pocket the cash for eight weeks before the ­debt-ridden landlord is able to insist that the benefit is instead paid directly. Last night the Government vowed to call time on the controversial Local Housing Allowance that created the multi-million-pound scandal in the dying days of the Labour administration.

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.”

Fiona McEvoy of the TaxPayers’ Alliance said: “It’s simply unacceptable for public money to be frittered away at the hands of the wrong people and with public finances stretched, the Government simply can’t afford to let millions of pounds slip through their fingers like this.

“If the system allows rogue tenants to steal money from taxpayers and landlords then it clearly needs to be reformed.”

Conservative MP Philip Davies said: “It’s ludicrous that the last government stopped paying housing benefit to the landlord. It’s essential that this Government goes back to paying landlords directly.”

The Local Housing Allowance, introduced in April 2008, has been blamed for allowing benefits scroungers to live in luxury.

Now it has emerged that it has led to huge numbers failing to pay their rent in the knowledge that they are very unlikely to be evicted.

For tenants of council or social housing, the allowance is paid directly to the local authority but private tenants are responsible for paying the landlord themselves.

However, this has led to thousands stealing the money. Landlords cannot demand the rent is paid directly until tenants are eight weeks in arrears and are usually reluctant to attempt eviction due to the cost of legal fees.

Up to one in 10 of the 674,930 tenants claiming the allowance are involved, interviews with almost 1,000 landlords by the National Landlords Association found.

Spokesman Vincenzo Rampulla said: “The Government made the housing benefit market a lot riskier for landlords. The landlord cannot go back to the Government to get the rent arrears back because it’s already been given to the tenant.”

The scandal has caused rent arrears of an estimated £227.4million up to October 2009. The association found that the scam had created debts across the country amounting to £42.7million in the South-east, £35.4million in the South-west, £33.9million in London, 19.7million in the North-east, £17.9million in the West Midlands and £17.7million in East Anglia.

Also £15million in Scotland, £14.7million in the North-west, £12.8million in the East Midlands, £11.7million in Yorkshire and Humberside, £5.5million in Wales and £400,000 owed in Northern Ireland.

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