24 Apr 2013

LGA: let us use data sharing against housing tenancy fraud

Peter Fleming writes for The Guardian (with my annotations).

Although less well known than housing benefit fraud, housing tenancy fraud is a hot topic in local government. In May, housing tenancy fraud will rightly become a criminal offence, carrying a two-year prison sentence and a £50,000 fine. This is a clear sign from the government to anyone who thinks they can cheat the state that they will face serious consequences. But how much will the new legislation actually help councils to crack down on this abhorrent behaviour?

The most recent estimates suggest that up to 98,000 homes are being let to people who either lied about their circumstances to jump the queue or are sub-letting their council house and pocketing the profits. These people are denying 98,000 deserving families and vulnerable people being found a stable and affordable home. This equates to roughly 5% of the 1.8 million housing applications on council waiting lists and, if these homes were freed up, they would help rehouse some of those forced to live in emergency accommodation, which costs the taxpayer hundreds of millions of pounds a year.

With council budgets having been cut by a third and more cuts on the horizon, it is difficult for us to employ specialist fraud teams. The government has recognised this and this month the housing minister awarded 62 councils a total of £9.5m to fund investigations and prosecutions to help catch the tenancy fraudsters and bogus landlords. Yet even this means that just one in five local authorities responsible for housing will get extra funding.

While we welcome any additional money in the current climate, councils appreciate more than anyone the need for us to do more with less. We recognise that the key to tackling tenancy fraud lies in greater co-operation between councils, housing associations and the private sector. Indeed, in its Protecting the Public Purse report, the Audit Commission praised council efforts to date to find more efficient ways of addressing the problem.

However, restricted access to data held by utility companies, building societies, lettings agents and organisations like the TV Licensing Authority makes it difficult for council fraud teams to identify fraud or prioritise cases to have the maximum impact. Without the legal tools to request information, councils must rely on tenancy inspections and tip-offs from neighbours. Unfortunately, the new legislation on housing tenancy fraud doesn't include the necessary regulations to make data sharing mandatory.

What is strange is that councils already have such powers to request material to support investigations into suspected housing benefit fraud. If the government simply extended these rights to allow us to investigate tenancy fraud more efficiently, we could help reclaim thousands of council and housing association houses with limited cost to the taxpayer.

When the Department for Communities and Local Government consulted on the tenancy fraud bill as it was going through parliament, 90% of the 188 councils, housing associations, residents' associations and other public and private sector bodies who responded supported the idea of mandatory data sharing. One of the water companies even made the point that in practice simply extending the existing powers would be unlikely to add any significant new burden because arrangements are already in place for sharing this kind of data.

As part of our work with the Fighting Fraud Locally Board, the Local Government Association (LGA) is launching three pilot projects bringing together groups of councils from around the country to work with local housing associations and private sector companies to highlight just how improving data sharing can make a huge difference. Over the next 12 months, Huntingdonshire, Peterborough, Fenland, Watford, Three Rivers, Stroud and Gloucester aim to recover more than 100 properties. These pilots will build on the work of pioneering councils in this area such as Southwark, Bristol and Stoke-on-Trent, who between them last year reclaimed 425 properties.

While tackling tenancy fraud won't solve the chronic shortage of housing, we cannot let these criminals get away with unashamedly exploiting a system that was designed to provide vulnerable people and hard-working families an affordable place to live. There is clear support for data sharing and a strong business case. It's now up to government to give us the tools to enforce the new legislation and stamp out abuse of the system.
  • Social housing frauds are the most immoral frauds in the welfare system. They don't just cost all of us money, they also stop families and the vulnerable having the accommodation they need.

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