Ministers will target those who could afford to buy or rent a house comfortably but instead choose to live in a council house at vastly lower rents than those paid in the private sector.
For some London properties this amounts to the equivalent of someone having their rent subsidised by the taxpayer by up to £70,000 a year.
According to a Whitehall analysis prepared for ministers, there are up to 6,000 people in social housing with an income greater than £100,000.
A range of options is now being considered to free up this housing, which ministers say is being kept from those in need. These include granting new powers to councils, and the social landlords they control, to take homes away when it is clear that the income in the household is more than £100,000.
That would require changes to the law, but ministers are prepared to change the law to demonstrate their commitment to reforming the way in which council houses are allocated. (read more)