Unemployed Mr Khaliif and his wife claim not to be able to speak English so were unavailable to provide the Telegraph with a comment on the £2,000 per week rental bill they have claimed from taxpayers. For comparison, the latest median average earnings figure for full time employees is £499 per week while the part time figure is £153 per week.

The highly desirable period property, which was described by estate agents as a “stunning six bedroom house with two receptions recently refurbished to a high standard” was bought by the current owner in 2008 for £1,480,000. House prices in prime London locations have risen since then. The detached home, situated in the London Borough of Camden, also boasts a “spacious en suite master bedroom”.

The Coalition introduced new rules in April capping Housing Benefit at £400 a week. It is thought that Mr Khaliif moved into the extravagant home before they came into effect. TaxPayers’ Alliance director Matthew Sinclair told BBC News in July that uncapped benefits are unfair:

A Department for Work and Pensions spokesman said:

New rules came into force in April. As their claims come up for renewal people on housing benefit will have to make the same choices as people in work about where they can afford to live.

The implementation of the new rules cannot come too soon, both for the benefit of the government’s vast budget deficit and to end the most shockingly grotesque examples of benefits extravagance.

He was particularly scornful of the local Council’s Affordable Housing Levy which has just been introduced or “another stealth tax” as he put it,

“I just cannot see how they ever expect us to build enough homes when they keep increasing taxes and regulation it is a nonsense. I take all the risk, work bloody hard and what do I get in return? Tons of red tape, no profit and I have to pay through the nose to keep a squad of bureaucrats in well paid jobs”

Here is a rough outline of why he is so angry:

Land Purchase                                                          £300,000

Stamp Duty Land Tax                                                £9,000

Demolition & Site Clearance                                     £40,000

Architects & Planning                                                £15,000

Build costs                                                                  £407,000

New Tax – Affordable Housing Levy                         c.£38,000

Other Professional Fees                                             £6,500

Total                                                                           £815,500

Local agents have suggested that current open market value for the three houses combined would be £830,000, so it is not worth our man proceeding. In better times he would have expected a value of £910,000, making him around £94,500 profit less agents fees plus VAT of £21,840, giving a pre tax profit of £72,660.

How much then could the state have extracted from the deal, assuming it sold for £910,000?

SDLT on purchase                                                         £9,000

VAT on agents fees for site purchase                            £1,200

Fees associated with Planning, Land Registry etc.   c. £5,000

Affordable Housing Levy                                            c. £38,000

SDLT on Sales                                                               £27,300

VAT on agent fees for sale of three houses                   £3,640

Tax and NI on £72,660                                                  £23,480

Total for the state                                                      £107,620

The developer’s share                                              £49,180

If he was to proceed with the project in current circumstances he would suffer a loss of £5420 after agent’s fees + VAT and the state would still extract over £80,000.

If the Government are looking to the Private Sector to lead our economy into growth they certainly aren’t encouraging small builders to play their part.