The government is under fire after scrapping plans for tougher regulation of the letting industry.

A landlords register and new regulation of letting agents were to be introduced by the previous Labour administration.

The Association of Residential Letting Agents (ARLA) said cutting the plans would aid rogue landlords. Citizen's Advice also criticised the decision.

But Housing Minister Grant Shapps said the sector was already governed by a well-established framework.

He added that the government wanted to focus instead on increasing home ownership.

"With the vast majority of England's three million private tenants happy with the service they receive, I am satisfied that the current system strikes the right balance between the rights and responsibilities of tenants and landlords," Mr Shapps told Parliament.

He said Labour's plans would create too much red tape.

But ARLA, the body that represents letting agents, criticised the decision.

Ian Potter, operations manager at ARLA, said: "A great fear is that a lot of agents who were looking at tidying up their practices will now feel they can run amok and add to the poor reputation we have at the moment."

Citizens Advice also said the move to scrap stronger regulation was a mistake.

In a recent survey of 1,300 tenants, it found 73% were unhappy with the service they received from their agent.

Common problems included extra fees and poor communication.

The charge for checking references or renewing a contract can range from £10 to more than £200.

Lizzie Iron, head of welfare policy at Citizen's Advice, said: "We are really disappointed [the government] has decided not to take this forward, because we felt that regulation was going to be really important to give tenants peace of mind and better support for landlords."

The agency also questioned the government's decision to focus on boosting home ownership.

"While this may be a laudable aim, our evidence shows that home ownership is not the answer for everyone, especially for people on low or fluctuating incomes who find it hard to get a mortgage in the first place," Ms Iron said.

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CASE STUDY

Retail manager Adam French said his agent did not pass on money to a landlord or return his deposit on a property he had rented.

He broke up with his partner and is now living with his grandparents.

Said Mr French: "It's put me off the whole rental affair.

"You think people are trustworthy and you think it's a big company.

"But they can still get away with taking money from you that doesn't belong to them."

As the vast majority of tenants appear to be happy, it would be a shame to increase costs for everyone just because a minority fail to research their agent/landlord properly.

In a recent survey of 1,300 tenants, it found 73% were unhappy with the service they received from their agent.

How did they manage to bank post-dated cheques??