Reeves could face paying £40,000 after breaking housing law

Rachel Reeves could be forced to pay back £40,000 to her tenants after breaking housing rules, The Telegraph can disclose.

The Chancellor has admitted failing to obtain a rental licence for her home in Dulwich, south-east London, after moving to No 11 Downing Street following Labour’s election win last year.

Southwark council requires private landlords in certain parts of the borough to obtain a “selective” licence to rent out a property. Not doing so can lead to prosecution or a fine.

To obtain a licence, landlords must prove their property is fit for purpose by submitting documents including tenancy agreements and safety certificates. Licences cost £900.

The leader of the opposition on Southwark council has now demanded the Labour-run authority investigate and “pursue any further enforcement action that may be warranted”.

Victor Chamberlain, a Liberal Democrat councillor, also urged the council to assist Ms Reeves’ tenants “to recover any rent they are owed for this breach”.

Tenants are able to apply for a repayment order if they have rented an unlicensed property, according to Southwark council’s website.

If successful, they can get back up to 12 months’ rent. At £3,200 per month, the total amount of income that Ms Reeves could have to pay back stands at £38,400

He added that the local authority should “pursue any further enforcement action that may be warranted, including prosecution”.

Mr Chamberlain also called on the council to ensure Ms Reeves was “added to the rogue landlords register if found at fault”.

The councillor told The Telegraph it was “absolutely scandalous” that Ms Reeves had failed to obtain the correct licence.

“She absolutely should have known better than this. This is a housing licensing scheme that has operated in Southwark for four years. It’s something that she’s even called for to be implemented in her own city of Leeds.

“They can’t have one rule for one type of landlord that is breaking what’s expected of them, and not for one of their own.”

The council receives around £4.3m per year on average through the licensing scheme. It is a criminal offence to fail to obtain a licence when required.

Mr Chamberlain added: “It’s absolutely imperative that when we’re in the news for all the wrong reasons this morning, that we follow through with that and take all the appropriate action that’s necessary in this case.

“That ultimately can mean an unlimited fine, it can mean Rachel Reeves having to pay back the rent that she’s taken to the tenant, which I think would be reasonable if this is true.

“But I think it’s absolutely important that the council does take immediate action and is seen to do so publicly.”

‘Inadvertent error’

In a letter to the Prime Minister on Wednesday evening, Ms Reeves “sincerely” apologised for her “inadvertent error” of not obtaining the licence, first reported by the Daily Mail.

“I wanted to make you aware of a matter which has been brought to my attention regarding my family home, which we are letting out to tenants via an external lettings agency.

“There are selective licensing requirements in this ward for renting out a property. Regrettably, we were not aware that a licence was necessary, and so we did not obtain the licence before letting the property out.

“This was an inadvertent mistake. As soon as it was brought to my attention, we took immediate action and have applied for the licence.”

In a reply to the Chancellor, Sir Keir Starmer said her apology was a “sufficient resolution” and said the matter would not be investigated further.

The Chancellor previously wrote in support of the landlord licensing initiative which tripped her up in Southwark, approving the decision last week to expand it in her own constituency.

She wrote on X: “I welcome Leeds City Council’s decision to expand their selective landlord licencing policy to include the Armley area.

“While many private landlords operate in the right way, we know that lots of private tenants in Armley face problems with poorly maintained housing.”

The Labour-run Southwark council introduced one of the largest licensing schemes in the country in July 2023, after a pilot in some areas of the borough.

Expenses investigation at bank

In February, it was reported that Ms Reeves had previously been investigated over her expenses while working as an economist at Halifax Bank of Scotland before her parliamentary career.

Ms Reeves and two other senior managers allegedly spent hundreds of pounds on a company credit card designed for gifts to motivate other staff.

The BBC reported that a whistleblower had complained about senior managers at the bank using expenses to “fund a lifestyle”, including by buying Christmas gifts.

A spokesman said that Ms Reeves was not aware of any investigation and had always complied with expenses rules.

She has also been accused of lying on her CV, after she repeatedly claimed she had worked at the Bank of England for “the best part of a decade”, despite working there for five and a half years, including one year studying.

The Conservatives demanded that the Prime Minister “grow a backbone” and sack the Chancellor for the rule breach.

The revelations about Ms Reeves’ property comes after Angela Rayner, the former deputy prime minister and housing secretary, was forced to resign when a Telegraph investigation found she had underpaid stamp duty on her second home by £40,000.

Six days later, Sir Keir sacked Lord Mandelson, the former ambassador to the US, after leaked emails revealed the extent of his friendship with Jeffrey Epstein.

In November last year, Louise Haigh resigned from the Government after she admitted pleading guilty to misleading the police a decade ago.

Southwark Council has been approached for comment.

[Source: Daily Telegraph]