Charles Dickens, one imagines, would nod knowingly if transported to 21st-century Britain and taken on a tour of rogue landlords’ rented premises. Broken heaters, non-existent fire escapes, unsanitary bathrooms and vermin infestations are standard to inspectors of private rented housing acting for councils. Lamentably, only a tiny fraction of rogue landlords are punished, and most of those get away with paltry fines that amount to a slap on the wrist.
Up to £1.3 billion of taxpayers’ money is paid to such landlords each year in the form of housing benefit. Tenants who complain are often turfed out by landlords who know the complaint will lapse before it is investigated. In the language of economics, this is a market failure. The fundamental cause is a chronic shortage of affordable housing, especially in London and the southeast. If housing supply more closely matched demand, tenants could punish abusive landlords by taking their money elsewhere.
In the language of ordinary people this is a scandal in which law enforcement fails, the needy suffer and criminals exploit them with impunity. They must be deterred, and jailed if necessary. As the chairman of the Local Government Association put it recently: “They really need to be frightened that something’s going to happen to them that they don’t want to happen.” The government has floated proposals, including on-the-spot fines of up to £5,000 and a national blacklist of rogue landlords. Such measures should be adopted swiftly. If they are not, still more draconian steps will be required and the majority of law-abiding landlords will suffer, along with their tenants.
Of the £25 billion spent on housing benefit each year, nearly £9 billion is paid to private landlords. Sixteen per cent of their accommodation fails to meet basic safety and hygiene standards, inflicting misery on 120,000 families and at least as many students and multiple-occupancy households.
Renting out sub-standard accommodation is a crime, but as a Times investigation finds today more than a quarter of all councils in England have not prosecuted a single landlord in the past five years. Barely 2,000 landlords have been successfully prosecuted since 2007, and those convicted have been made to pay fines averaging £1,500. For those with multiple properties such a penalty is, as one official puts it, “like giving a premiership footballer a speeding fine of £1,000”.
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In less serious cases, improvement notices issued by councils are routinely challenged and bogged down in the courts for months or years. Or they are defied by evicting tenants who dare to complain, since a notice does not apply to a former tenant. “Rent repayment orders” were introduced in 2004 as a deterrent to rogue landlords. So far councils have been allowed to use them only against those in the social housing sector. They have seldom bothered.
Emboldened by this broad failure of law enforcement, the worst landlords are mocking the dignity and endangering the health of the neediest tenants. One landlord in Coventry was fined £100 for forcing six tenants to live for a year without a fire alarm or exit. Another was fined £350 for failing to repair a flat with faulty electrics, no hot water or heating and an infestation of mice and cockroaches. A third has been fined a total of £16,565 — but only after seven convictions.
Magistrates must be allowed to impose bigger fines for the worst offences. Housing inspectors should be able to levy on-the-spot fixed penalties for lesser ones, and offenders must be blacklisted so that tenants as well as councils can avoid them. Rent repayment orders should be enforceable in the private as well as the social sector, but requiring all landlords to be licensed would be a step too far. The response to this scandal must be to punish those who break the law, not those who don’t.