Housing campaign group SHAC has today published research resoundingly debunking Housing Secretary Matthew Pennycook’s claims that current systems protect residents from rampant service charge abuse.

In an official parliamentary response on 2nd April 2026, Matthew Pennycook rejected calls to cap skyrocketing service charges. The Minister claimed that current legal systems such as the First-Tier Property Tribunal afford adequate protection for residents to contest unfair bills.

However, explosive new data from a SHAC survey of 829 tenants and residents proves the Minister is entirely wrong. The findings expose a broken regulatory vacuum where landlords exploit residents with impunity, driving increasing numbers of desperate tenants to collectively withhold their payments.

The Reality of Service Charge Abuse

SHAC’s investigation reveals that landlords and the housing establishment are systematically exploiting tenants and residents through:

• Runaway costs: Annual service charge hikes vastly outstrip both inflation and wage growth.
• Information blackouts: Landlords routinely ignore legal data requests and block residents from inspecting financial invoices.
• Systemic financial abuse: Bills are riddled with overcharging, incorrect cost splitting, and fees for ‘ghost’ services that do not exist.
• Justice delayed: Disputes routinely drag on for years. Even when residents win, securing a refund is nearly impossible.
• Broken oversight: Internal landlord complaint processes, the Housing Ombudsman and regulatory bodies completely fail to provide justice.
• Devastating human toll: The financial strain triggers severe mental ill-health, forces cuts to essential food and utility spending and drives families into deep debt.

Shocking Survey Data Exposes Systemic Failure

SHAC surveyed 829 affected tenants, shared owners, and leaseholders across the UK. The data paints a damning picture of the current housing landscape:

• Skyrocketing hikes: The most common service charge increase was between 21% and 50%, while 11.7% of respondents saw their bills more than double.
• Rampant overcharging: Two-thirds (66.1%) reported direct overcharging, 59.7% were billed for non-existent services, and 89.5% stated these issues happen year after year.
• No way out: Over half of all formal disputes (56.3%) drag on for more than two years, and 30.4% last over four years.
• Refunds denied: More than 80% of affected respondents received zero financial redress. Only a tiny 4.2% recovered their money in full.
• Zero transparency: Only 24.2% of residents receive annual summary statements automatically. When requested, nearly a quarter of landlords completely ignore the demand.
• Total loss of confidence: Landlords’ internal systems, the Housing Ombudsman Service, the Regulator of Social Housing, and the First-Tier Property Tribunal all received overwhelmingly negative, one-star ratings from users.

Suzanne Muna, SHAC Secretary and Cofounder said: “Matthew Pennycook is dangerously out of touch. His groundless faith in a broken system completely ignores the thousands of tenants and residents trapped in a living nightmare. Our data proves that the law offers little protection against service charge abuse. 

“Landlords are routinely getting away with systemic financial exploitation, charging families for ‘ghost’ services, and driving people into debt. When two-thirds of residents report overcharging and tribunals take over four years to resolve anything, the system isn’t working – it is enabling abuse. 

“Tenants and residents are sick of being ignored, and we are supporting increasing numbers to take matters into their own hands by withholding payments collectively.”  

The human toll is stark.A tenant of Southern Housing wrote to SHAC saying: “Huge stress. It’s a full-time job, of course on top of my other job that I need in order to actually pay for the cost of living crisis! My husband and I broke up over it, it caused constant arguments as well as constant stress from the expense.”

A Hyde leaseholder complained: “As a secretary to a TRA [Tenant and Resident Association] it takes many hundreds of hours – all unpaid that would be unnecessary if Hyde got things right, did not deny anything was wrong and engaged to resolve things.”

SHAC’s Seven Demands to End Service Charge Abuse

To fix this regulatory black hole and rebalance power between landlords and residents, SHAC demands seven urgent legislative measures:

1. Invest in Council Housing and End Leasehold: Expand democratically accountable council homes and abolish the exploitative leasehold system.
2. Fast-Track Dispute Resolutions: Create speedier, free and accessible routes to resolve service charge battles.
3. Enforce Universal Transparency: Standardise transparency laws across all landlord categories and tenancy types.
4. Expand Legal Aid: Fully fund housing-related legal cases so residents can fight back.
5. Regulate Social Housing: Embed a strict service charge regulatory standard directly into the Regulator of Social Housing’s framework.
6. Order Universal Refunds: Empower tribunals to order estate-wide refunds for all affected neighbours, not just individual claimants.
7. Introduce Tough Sanctions: Implement meaningful financial and legal penalties to force genuine behavioural change from rogue landlords.

SHAC is a campaign group linking tenants, renters, shared owners, and leaseholders living in social and private housing. It campaigns to improve the conditions of homes and neighbourhoods and to reduce the commercialisation of housing. More information on the End Service Charge Abuse campaign can be found here.