Hackney Counci’s Housing Department was haven to a host of dodgy dealings in the early 1990s. A number of staff were involved with handing over keys to vacant council flats for cash payments.
The same department had a dubious history – it was also embroiled in a scandal about racism in 1984, after which much seemed to have been done to improve things in that respect.
What happened?
At least 40 council flats across the borough were fraudulently marked as uninhabitable by council staff and then offered to friends and acquaintances for cash payment. (Later estimates suggest 50 flats on Woodberry Down Estate alone). Rent on these flats was then collected by the same staff using bogus rent books.
Alongside this, housing benefit was fraudulently claimed by council staff for bed and breakfast accomodation that was not being used.
Squall magazine estimated that bent council staff had pocketed £20million from all this.
According to MP Diane Abbott, Hackney had “41,000 tenants, 8,000 people on the waiting list and 3,000 homeless.” in March 1991. As well as the highest number of (supposedly) “void” flats in the country…
How it was exposed by a squatter
Text below from Hackney Heckler #10 December 1991:
“Keys for cash” was exposed by a squatter living on Woodberry Down Estate, who was convinced the council were evicting squatters. on the estate illegally.
He became suspicious of the fact that once a tenant left a flat, notices appeared immediately on the doors with a named “Protected Intended Occupier” (PIO). ‘How often is the council efficient enough to fill an empty straight away?’ he asks himself. He then noticed what were meant to be council workers arriving to do up empty flats at 5am in the morning and leaving by 7am!
The only people who seemed to be getting housed were young single men. To find out for sure, he went to the area housing office saying he was the brother to one of those named as a PIO and asked for the keys to the flat. In this way he managed to get the keys and rent books to five flats on the estate!
He decided to contact Janet Jones the then Director of Housing. He told her what he knew, giving her copies of the false PlOs and rent books. She assured him she would look into the whole affair.
However it was obvious he knew too much. A few days later he was confronted in his local pub by three men who offered him £800 and a council flat for life if he returned the keys and rent books and kept his mouth shut. He refused.
At 3am that night they smashed their way into his flat. Rushing into the nearest room where his girlfriend was asleep, they attacked her with baseball bats, only stopping when the man they were after ran at them with a crowbar. The police and ambulance were called as the woman was badly injured in the attack. The police were far from sympathetic, no statement was taken with one of the officers saying “we know what’s going on here, and we can understand if you want to do something about it yourself.”
He tried to get back in touch with Janet Jones who never seemed to be prepared to talk with him. He finally managed to see her, and again told her all he knew including the attack on him and his girlfriend. She seemed very flustered and said she would look into it and contact him in a couple of days. The next thing he heard she had left her £50,000 a year post and was living in Brazil! He decided to tell all he knew to Liberal councillor Colin Beadle who duly contacted the police and media. So that is how the cat got out of the bag!
(Effusive thanks to comrades at Tyneside Anarchist Archive for the scan of this issue of Hackney Heckler, which has been added to our collection of issues at archive.org. Tyneside Anarchist Archive has recently published a brick of a book entitled Anarchism in North East England, 1882 – 1992, which looks amazing.)
It is worth remembering that Hackney Council was extremely hostile to squatters in the late 1980s and 1990s – there a numerous references to them occupying housing that could be given to families and those supposedly more in need of the universal right to a roof over their heads. The council boasted of its huge initiative to evict over 3,000 people from all of its squatted properties by April 1992. (By 1993, there were an estimated 1,152 squatters in Hackney which is a serious reduction. We were still number one in the country though!)
Whilst the squatters were being presented as evil incarnate, council staff were trousering filthy lucre from letting out the very flats they were supposed to be allocating to those in need…
…and ultimately it was whistleblowing by a squatter that put a stop to the corruption!
What happened next?
I’ve not found comprehensive information abot this, but at least 13 staff were suspended and at least five were sacked after a council investigation costing £250,000.
The Hackney Heckler noted that management were treated very differently from frontline workers in the investigation:
A Mr D Evans, manager in the Hall lettings department was found to be pocketing £1,000s to supplement his bloated salary. According to the report “the police treated the matter as a normal case of theft, issuing the
individual with a warning”! He later left his job with no disciplinary hearing, promising to pay back the cash.Compare this to another case where a housing benefit worker claimed housing benefit from another borough by failing to disclose his employment. He was arrested and charged by the police and sacked by the council. A typical example of the police and council working together, protecting the fat cats at the top while those at the bottom carry the can.
Hackney heckler #10 December 1991
The hostile tone of the investigation was met with resistance from the staff – a hundred of them staged a walkout. This was followed by a one day strike of 500 staff members.
A number of families who may (or may not) have gained council flats in good faith were evicted.
The council then proposed a rent increase of £15 a week, presumably to try and recover some of the costs of all this.
Unsurprisingly the corruption was not limited to “cash for keys”, there was a parallel scandal about recruitment into council jobs.
In 1995 the acting CEO of the council stated that:
In the past five years the council has sacked 110 employees for fraud- related offences, and successfully prosecuted 24.
In the case of job fraud, an investigation of all staff who had joined the housing directorate in the previous two years was begun in November 1993. Of 352 employees investigated, 11 were subsequently dismissed, two resigned and one died who would have been sacked. Two are suspended pending disciplinary action.
Mike craig “ANOTHER VIEW; Hackney’s fraud squad” in the independent
There are a number of press cuttings about “cash for keys” below, which are all culled from the scrapbook of Hackney Community Defence Association for 1991, which Mark Metcalf has generously uploaded to his site.
The council outsourced its housing dept to Hackney Housing in 2006. This “Arms Length Management Organisation” was then rocked by a corruption scandal in 2015, before being taken back in-house. Seven staff were sacked and eight resigned. Throughout the 1990s and noughties a number of Hackney council estates were handed over to housing associations…
The Radical History of Hackney 