UK

Tenancy Fraud In Social Housing Costing Councils £845m A Year

17/06/2013 10:28 BST | Updated 17/06/2013 10:38 BST
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File photo dated 12/07/12 of an aerial view of houses on residential streets in east London as millions of low-income households face a steep rise in their council tax bills from April, according to research published, aome 74\% of local authorities in England are planning to increase their demands on families whose council tax is currently discounted or even covered in full by the Government.

Social housing providers could save millions of pounds by targeting tenancy fraud, according to a new study.

Figures released last week show that in 2013 the National Fraud Authority identified housing tenancy fraud as the second largest single drain on local government coffers caused by fraud in England, with an annual cost of £845 million.

In addition there is a further £919 million annual loss to the public purse as a result of tenancy fraud committed against housing associations.

This combined annual loss to housing tenancy fraud of £1,764 million is much greater than housing benefit fraud, which is estimated to cost the UK taxpayer £350 million per annum.

The study by Alan Bryce, head of counter fraud at the Audit Commission and a Masters student at the University of Portsmouth, is the first to identify the scale of the problem.

Housing tenancy fraud occurs when a tenant unlawfully sublets a council or housing association-owned property to someone else, when a family abandons a house or does not occupy that property as their principal home.

Almost 100,000 people in England are committing tenancy fraud, equivalent to a community the size of Woking in Surrey, according to the study.

Councils reclaimed nearly 1,800 homes from housing tenancy fraudsters last year.

To build an equivalent number of homes from scratch would have cost the public purse more than £265 million.

Mr Bryce said: "These figures are only starting to make a dent in the problem."

He said social housing providers are getting better at detecting tenancy fraud, as long as they look in the correct way.

Londoners are less likely to get away with committing tenancy fraud, as councils in the capital have been addressing the issue for longer and many already employ specialised fraud detection investigators.

Mr Bryce said social housing providers need to work together to increase the amount of fraud detected.

Currently more than half of all non-London councils with housing stock did not detect even a single housing tenancy fraud in 2012.

The findings are published in Protecting The Public Purse 2012, an annual national publication produced by the Audit Commission.