Tenants could escape the bedroom tax by starting a business in their spare room, a Conservative peer has suggested.

Inside housing has reported:

Starting a business would bring the room into use, should tenants get permission for the business from their landlord.

The possibility was suggested in the House of Lords by Earl John Atlee, a hereditary Conservative peer and grandson of former Labour PM Clement Atlee.

Earl Attlee said: ‘The spare room subsidy encourages people to make full use of their property and to consider running a small business. I think that is highly desirable.’

Chris Bryant, shadow welfare minister, told the Sunday People: ‘Instead of dressing up this unfair bedroom tax as a business opportunity, they [the government] should be scrapping it.’