A COUNCIL has hit back at claims from a trade union that it made ‘secretive’ payments totalling hundreds of thousands of pounds to private landlords.
The GMB claimed it had lifted the lid on the ‘exploitation of public money’ in Burton after obtaining figures that revealed East Staffordshire Borough Council paid around half a million pounds directly to 20 companies or individuals alone in the space of a year to cover the bills of tenants in receipt of housing benefits.
The authority said it had nothing to hide and that it was ‘happy’ to make details of the payments public.
There is nothing unusual about local authorities paying cash directly to landlords.
They will often do so when there is a concern that tenants who are eligible to receive housing benefits will be unlikely or unwilling to pay their rent on time, thus ensuring the landlords do not lose out on what they are owed.
But the GMB argued that the policy allowed private landlords to ‘suck up taxpayers’ money’ by keeping rental rates high.
Union bosses said the money would be better spent building homes which people with financial difficulties could afford.
It said the figures should bring ‘shame’ on the Government and called on it to scrap the practice.
The biggest sum paid out by East Staffordshire Borough Council was to estate agent Nicholas Humphreys, which has a branch in High Street, Burton.
It received £62,059 in the year to November 2013 to cover for its tenants in receipt of housing benefit.
Fellow property firms Surelet and Acquire also appeared near the top of the list, receiving £53,762 and £44,507 respectively.
Paul Kenny, general secretary of the GMB, said: “Our research lifts the lid on the mainly secret payments to landlords who are the real winners from Britain’s welfare system.
“The research shows the rich and powerful sucking up taxpayers’ money through housing benefit. This is made possible by out of control rents and a lack of affordable and council homes that so many hard working people and their families desperately need.
“This should bring both shame and action from this government to end this exploitation of public money. These billions would be better spent building houses and homes for real working people.”
A spokesman for East Staffordshire Borough Council said: “Housing benefit is paid to landlords in accordance with the relevant legislation.
“Landlords who have more than one tenant receiving housing benefit are therefore likely to receive large payments in a financial year, dependent on the tenants’ income and circumstances.
“East Staffordshire Borough Council was more than happy to provide the information in accordance with Freedom of Information and Data Protection legislation.”