Millions of pounds have been wasted by government reforms on housing benefit, according to the National Landlords Association.
Local Housing Allowance (LHA), which has proved controversial among landlords, was introduced last year, directing housing benefit from the state directly to the tenant rather than the landlord.
Tenants are then expected to pass the finance on to their landlords to cover rent or other housing costs.
However, the NLA has said that this system is causing “major problems” because the finance is not getting passed on in many cases and landlords are being left out of pocket.
The landlords association has estimated that around £2.6bn will be spent on LHA during the 2009-10 financial year and is lobbying the government to change its policy.
Richard Price, NLA director of operations, commenting on the LHA campaign, said: “Landlords up and down the country need to join forces and demonstrate to government just how much this new system is not working.
“If something isn’t done then landlords who currently operate in this market will be leaving in their droves and it will be the most vulnerable tenants who will be left out in the cold.”
