Housing benefit cuts for unruly neighbours

Cuts in housing benefit to tackle "neighbours from hell" will be included in a far reaching Green Paper, being issued tomorrow, that aims to speed up house sales, make property more affordable and tackle homelessness.

Cuts in housing benefit to tackle "neighbours from hell" will be included in a far reaching Green Paper, being issued tomorrow, that aims to speed up house sales, make property more affordable and tackle homelessness.

Unruly tenants could lose housing benefit under the proposals to be put forward by John Prescott, the Deputy Prime Minister. A ministerial source said: "Jack Straw has been criticising councils for failing to crack down on antisocial behaviour. We think that unruly neighbours affect the whole neighbourhood. We could adapt the benefit rules to encourage tenants to act more responsibly."

The proposal will be highly controversial, because it could hit poorer families, but ministers are planning the move to limit the use of the "blunt instrument' of council eviction, which can make unruly families homeless and pass on the problem to other councils. And for the first time, it would give the authorities some power over unruly tenants of private landlords. Cutting housing benefit would be a last resort but ministers are determined to do more to tackle the problem.

The Green Paper offers no "big bang" solution to the rising cost of housing benefit, which has been blamed for widening the poverty trap.

"Key" workers, such as nurses, teachers, police and firefighters, could be offered interest-free loans to buy houses in areas where they cannot afford to step on to the bottom rung of the property ladder. The consultation paper will contain no figures about the loans that could be offered, but they might be up to £50,000 interest free as a top-up for houses of up to £125,000 in London. The loans could cut bills by £156 a month on mortgage costs.

Developers of new housing will be required in their planning permission to include affordable housing for sale in all new developments.

Councils will have a permanent duty to house the homeless and the paper will outline plans to give the "institutionally vulnerable" the right to a home. Ex-offenders, armed service personnel and young people leaving care will, for the first time, get similar rights to homeless families, who are put in a category of "priority need" and in effect allowed to jump the housing queue.

The paper will signal the large-scale sell-off of council estates, encouraging transfers to housing associations, and will point to the requirement, after the next election for faster electronic conveyancing.