Should we make landlords let to tenants on benefits?

It was quite astounding to see Eric Pickles stand up in parliament during prime minister’s questions yesterday and claim that landlords and letting agents do not advertise for non-DSS tenants. Were Mr Pickles to open his eyes he would see property advertisements and landlords clearly stating “No DSS” in their advertisements. Once again, we are seeing a Tory-led government completely out of touch with reality.

Over the last week news has emerged regarding one of the UK’s largest landlords, Mr Fergus Wilson, and his decision to evict around 200 people from his portfolio of some 1,000 properties for the sole reason that they receive housing benefit towards their rent.

Mr Wilson, who lives in my home county, Kent, reasoned that recipients of benefit are much more likely to (and if you listen to what he seems to imply that they almost definitely will) default on their rent payments.

This sweeping generalisation is simply wrong. I spent many years working in estate agency and I still know many professional landlords. In our joint experience, the vast majority of tenants in receipt of benefits are hard-working people, who are proud of their home, and who are on low incomes and require some level of benefit to help them pay for their home with remaining rent being made up from earnings. The rate of default I encountered as an estate agent was very low indeed and tenants who were working were just as likely to default due to illness, or losing their jobs.

I am uneasy with landlords refusing to let property to people on benefits, particularly when you consider that many of them have built empires of many properties which have been underpinned by and had their mortgages paid off in part due to the housing benefit system.

The demand for rental property is ever increasing as supply becomes more and more restricted. Rents are continuing to rise and with government cuts to housing benefit, tenants in need of benefits will find properties they can actually afford once they have topped up their benefit amount with their own income will be very limited. The problem this creates is that tenants will be driven to rogue landlords because it is all they can afford. It is this situation that has enabled “slum landlords” to get very wealthy by letting out very poor quality properties in sometimes uninhabitable states of repair to the most desperate who see little alternative.

It is my view that when elected, a Labour Government needs to create new legislation regarding the private rental sector and also introduce new rules on housing benefit. The system is not fair to all, and rife with discrimination. It is a system that has helped make empires, and now, due to Tory-led cuts, is a system which is failing the most vulnerable and leaving people with an almost impossible task of finding a home.

It should be made illegal for tenants to be automatically disqualified by a landlord or letting agent simply because they are in receipt of housing benefit. Decent people should not be penalised simply because they are low earners. This is a particularly important area of legislation in my view as most landlords I know, and have done business with, have built empires that have been underpinned by mortgages paid for by the housing benefit system.

Housing benefit should only be paid once properties have been inspected and found to be of suitable quality to ensure tenants are getting decent homes, and to ensure the taxpayer is getting good value for money. Properties should be subject to initial inspections before benefit payment is agreed, and then a relationship with the tenant maintained to ensure upkeep and repairs if necessary are being carried out within a fair and reasonable time scale.

The levels at which housing benefit is paid need urgent review and of course the first step is to repeal the bedroom tax which of course Ed Miliband has already pledged to do. The gap between rents and the level of benefit received is ever increasing, and the poorest and most vulnerable in society are being ever further stretched. As such, we need to ensure that housing benefit is of a suitable level to ensure people can live in a decent home, and still afford heating and food. As a society we should be helping those most in need, not handing out tax-cuts to millionaires.

Labour needs to communicate a message of support for those in need, to let them know that we will help them, and that decent homes and decent living standards for all is something we will deliver.