New national rules mean that benefit payments are made to tenants, rather than directly to landlords.

Malcolm Harrison, who rents out 12 properties in the area, said he has had trouble with people not paying rent and is owed over £600 by one tenant.

He said: "It will get to the stage where there'll be nowhere for them to live because landlords will stop taking tenants who are on benefits.

"It wasn't a problem before because we knew that if the money was being paid directly to us we'd always get our rent. Now we've got the situation where some tenants are getting their cheque in the post and cashing it to spend on something else."

Nazir Daud, who rents out properties in Dewsbury and Batley has experienced similar problems.

He said: "Some tenants are just not passing the money on."

Nazir added that some of his tenants would even prefer for the housing benefit or 'local housing allowance' to be paid direct to the landlord so temptation to spend the cash is removed.

Beverley Carpenter who rents a house from Mr Daud in Walker Street, Earlsheaton, said: "It's causing a lot more trouble. We have the hassle of making sure the money gets to the landlord on time, and the temptation of having this extra money which we didn't see before." Kirsty Dewhirst, who also rents a house on Walker Street agrees. She said: "I want the money to go straight to the landlord because I don't trust myself with it."

A spokesman for Kirklees Council said: "One of the new changes in this scheme specifies that tenants can no longer simply request that payments be sent direct to their landlord. However, there are specific circumstances where the local authority can make payments to the landlord. These are where the tenant is more than eight weeks in rent arrears, or where there is evidence that the tenant is unlikely to pay their rent."

He claimed the new scheme encouraged people to manage their own finances, but that landlords were better protected.

"They can now contact us after their tenant has missed one due payment. We would normally transfer payments to the landlord while we make further investigation.

"The fundamental elements of the scheme remain unchanged. The benefit payment belongs to the tenant. Any rental contract is between landlord and tenant, and the benefit scheme helps enable the tenant to meet their contract with their landlord," he said.