New research by Experian Public Sector has revealed that the threat of social housing tenancy fraud in the UK could be significantly larger than previously thought.
Based on an initial analysis of 125,000 social housing arrangements at just ten UK local authorities and housing associations in both rural and urban areas, Experian Public Sector’s experts estimate that potential fraudulent occupancy of social housing, such as subletting, could exist at a minimum of 157,077* properties when extrapolated up across the rest of the UK.
The Audit Commission estimated the level of tenancy fraud at 50,000 properties in 2009** but Experian Public Sector’s analysis suggests that the figure could now be at least three times higher than this.
The preliminary findings follow a series of data matching exercises which analysed social housing tenancy lists at ten UK local authorities and housing associations. The analysis looked for data that might suggest subletting and warrant further investigation. This involved the use of compliant information to identify a range of fraud indicators, including the number of tenants not currently occupying their tenancy address and found living at another address.
The analysis indicates that potential fraud, such as subletting, could exist within a minimum of 3.1 per cent of social properties. When extrapolated nationally, based on 5.06 million social properties, this suggests potential fraud could exist at a minimum of 157,077 properties in the UK.
If all of these social properties were subject to fraudulent activity and made available to people currently in temporary accommodation, the reduced cost and saving to the tax payer would be in excess of £2.0 billion*** a year. Freeing up existing social housing means reduced waiting lists which could also mean fewer new social properties need to be built.
Nick Mothershaw, Experian's director of Fraud and Identity Solutions, commented: "Our initial research suggests that the level of social housing tenancy fraud in Britain could be much higher than previously estimated. It also demonstrates how more effective data matching can quickly provide a reliable indication of what could be illegal occupancy and subletting. This means investigators can prioritise and deal swiftly with fraudulent cases. Reducing social housing tenancy fraud will significantly reduce the cost of temporary accommodation which we estimate to be at over £2 billion a year."
Notes to Editors:
* Preliminary research analysed social housing tenancy lists at just ten local authorities and housing providers in a mix of urban and rural areas. Additional files will be added over time and the estimates will be revised so at this stage the lowest minimum estimates are cited. The research showed strong supporting evidence of potential fraud at a minimum of 3.1 per cent of social properties. When extrapolated, based on total housing stock of 5.06 million, this would suggest potential fraud at a minimum of 157,077 properties.
** In its 2009 report entitled 'Protecting the Public Purse', Audit Commission estimated social housing tenancy fraud in 50,000 properties.
*** Savings are calculated using an estimated cost of £18,000 per annum for temporary accommodation. This is the aggregate cost based on estimates provided by housing providers in both rural and urban areas.
Experian is the leading global information services company, providing data and analytical tools to clients in more than 80 countries. The company helps businesses with credit risk management, fraud prevention, target marketing offers and automate decision making. It also offers a payments gateway to allow businesses to securely manage all UK payments and collections.
Experian also helps individuals to check their credit report and credit score, and offers ID verification to protect against identity theft. Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2011 was US$4.2 billion.
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