A LANDLORD who rents out 30 homes to families who receive housing benefits says he will evict all his tenants if new laws are brought into force.

The new universal credit system, which could be brought in next year, will mean social tenants will be given their housing benefits as part of a lump sum, instead of it being paid directly to their landlords.

But James Melly, who owns 30 properties in Bolton with his wife Malika, knows from experience that not all tenants will pass on the payment to landlords.

The last time such a system was brought in, he and his wife ended up £20,000 out of pocket, he said.

Currently, tenants receive their housing benefit direct, but if they default on their rent then the money is subsequently paid straight to landlords.

Mr Melly said: “Last time we became £20,000 in debt with our mortgage company.

“I was alarmed last week to hear that the newUniversal Credit system intends to pay tenants direct, yet again.

“As a business we have decided that should this policy of direct payments to tenants be continued with Universal Credit we will no longer be accepting tenants in receipt of this benefit in any of our 30 properties and the council will need to rehouse them.”

Bolton Council leader Cllr Cliff Morris warned that a landlords’ revolt could lead to a return to the days when local councils have to house homeless tenants in bed and breakfasts.

He added: “Will this impinge on the council tax payers? The answer would have to be yes.

“We could be going back to the days where people are put up in hotels and guest houses and I thought we had moved on from that.

“We are looking at the situation now.

“I won’t say we are prepared, because we don’t know how all landlords are going to react.

“This is another case of the Government not thinking a policy through.”

The Department for work and Pensions said direct monthly benefits payments to tenants was a “key part”

of Universal Credit.

It allows claimants to prepare for the financial resposibilities they will face when in work