Social housing is intended to provide affordable homes for those in genuine need, with all the well-documented health, life expectancy, education and employment benefits that arise from having a secure roof over your head.

It should not be for the purpose of allowing fraudsters to make a profit. And yet sadly, that is exactly what is happening. The findings of a report published last month by the Fraud Advisory Panel, in partnership with the Tenancy Fraud Forum, lay bare the full scale of the problem. 

Lost homes, lost hope: social housing fraud in England – recovering social homes for those in need notes that nearly 150,000 social homes in England are now subject to some form of tenancy fraud, including one in 20 social homes in London, and almost one in 30 outside London. The frauds in question include but are not limited to unlawfully sub-letting for profit, non-occupation as the principal home, succession fraud, fraudulent applications and key selling. 

The real victims of tenancy fraud (or social housing fraud, as it is also referred to) are the 1.2 million families in England stuck on the housing waiting list and the 95,000 homeless families currently in temporary accommodation. 

Despite the scale of the problem, many local authorities, housing associations, central government and the regulator are doing little – if anything – to address the problem. In fact, tenancy fraud detection has all but collapsed in some English regions. 

Between 2013/14 and 2019/20 (the last year before the impact of COVID-19 was felt) detected tenancy frauds across England fell by 50%. Had all social housing providers been able to match the good practice demonstrated by the better-performing social housing providers in each respective region, the number of detections should instead have doubled. 

The reasons behind the fall in tenancy fraud detection is multifaceted, but it’s fair to say that government decisions changed the landscape. 

The closure of the Audit Commission in 2015 led to a sharp decline in transparency and accountability for the detection of tenancy fraud by local authorities. The creation of the DWP Single Fraud Investigation Service in 2016 led to the removal of local authorities’ in-house benefit fraud investigators, often the people who also investigated tenancy fraud at a local level. 

Meanwhile, the Regulator of Social Housing has never collected or published any information on tenancy fraud detection by housing associations, a decision that is hard to comprehend given the documented benefits of transparency and accountability on detection performance by local authorities. Bearing in mind that housing associations provide 64% of the 4 million or so social homes in England, this lack of oversight and abdication of leadership by the Regulator of Social Housing is even more significant.

In 2019/20 alone, this “detection deficit” – the difference between what is achievable through universal adoption of good practice and the actual number of tenancy frauds detected – cost the public purse £500m. That’s the equivalent of building nearly 4,360 new homes in just that one year. During that same period (2013/14 to 2019/20) homeless families in temporary accommodation increased by 55% across England.

It does not have to be like this. Between 2009 and 2014, the number of tenancy frauds detected in England doubled. In some regions where detections had been negligible before 2009, they snowballed into the hundreds thanks to a combination of factors including greater partnership working, more investigative resources deployed to tackle the problem, widespread adoption of good practice and a critical spotlight being shone on the issue in a series of annual reports by the Audit Commission called ‘Protecting the public purse’. 

Not surprisingly, the COVID-19 pandemic resulted in a fall in tenancy fraud detections; from 2020/21 onwards, the recovery of social homes from tenancy fraudsters went into sharp decline. In the first year of COVID-19, tenancy fraud detections fell by 67%. Although the situation improved in 2021/22, detection rates remained almost a third below the detection activity level achieved in 2019/20, which was already half of that achieved just six years before.

‘Lost homes, lost hope’ also provides regional analysis of tenancy fraud detections by all social housing providers in every English region. For example, in the East Midlands tenancy fraud detections fell 41% between 2013/14 and 2019/20, while homeless families in temporary accommodation increased 140% in the same period. 

There are now 80,000 families currently on the East Midlands housing waiting list and 2,400 families in temporary accommodation, against a background of 10,000 tenancy frauds in the region. Who will hold the social housing providers in the region to account?

Tenancy fraud can be tackled through strong, committed leadership, adoption of good practice, greater accountability and transparency. As a first step, the report calls for the government and the Regulator of Social Housing to collectively commit to tackling the problem. Every local authority and housing association in England should make a similar commitment to the local people they serve. 

The report does not shy away from one of the main drivers of the recent increase in tenancy fraud, online facilitated short term illegal sub-letting, and thus also calls on letting agents, especially online letting platforms, to do more to stem the flow of tenancy frauds through greater sharing of information. Approaches aside, the moral and fiscal cases for tackling social housing fraud are compelling.

Alan Bryce is Business Fraud Campaign Manager at the Fraud Advisory Panel and author of Lost homes, lost hope.