A £20 million UK Government fund will support councils to crack down on landlords who profit through benefit claims but fail to support their vulnerable residents.

Supported housing provides accommodation alongside care, support, or supervision for residents who may have experience of homelessness, mental health issues or domestic abuse.

Poor performing landlords will need to improve and provide better accommodation and support or face enforcement action, including penalty charge notices of up to £30,000, prohibition orders on the most dangerous properties or even prosecution.

The funding will enable councils to step up inspection of accommodation standards and provide enhanced scrutiny of Housing Benefit claims to ensure they are reasonable. It will also improve local enforcement of the quality of accommodation and support to residents including supervision, advice, or help with life skills, to help tenants live independently in the community.

Housing secretary Michael Gove MP said: “Time’s up for rogue landlords who take money from the taxpayer while exploiting vulnerable people.

“We are stepping in to help councils crack down on this appalling activity and I will be working closely with Bob Blackman MP on his Private Members’ Bill to deliver tough new laws to end this practice once and for all.”

Responding to the funding, Cllr David Renard, Local Government Association housing spokesperson, said: “Everyone deserves a safe, decent, warm and affordable place to live, this is critical to the health and wellbeing of communities. This funding will be a positive step in helping councils tackle rogue landlords. It is critical that new funding is sufficient to cover the cost of inspecting properties that are below the required standards.

“Councils do everything they can to tackle bad practice and are taking action where required to raise standards in the private rented sector.

“However, further funding and support is needed to raise standards in the private rented sector and councils could do more if they were given the right tools, such as removing the requirement for Secretary of State approval for larger selective licensing schemes.”