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THE owners of a hellhole hostel are banking more than £1.5million a year in taxpayers’ cash.

Ron Barr and Kenneth Gray have become wealthy from a rat-infested slum bought for just £65,000. Up to 160 men, many with addiction and mental health issues, are crammed into the so-called hotel in Glasgow’s east end.

And the desperate tenants’ housing benefit of up to £199.25 a week for tiny cell-like rooms and shared squalid toilets and bathrooms adds up to a fortune for the landlords.

The Bellgrove Hotel is awash with drugs and alcohol, and residents often lie passed out in pools of their own urine.

Brothers-in-law Barr, 80, and Gray, 69, are directors of the firm who bought the premises in 1988.

They are the top-earning private landlords from housing benefit at Scotland’s largest local authority, Glasgow City Council.

Both men live in luxury homes in Glasgow’s south side and have made their family members shareholders in the venture.

Gray lives in a stunning detached Victorian villa worth around £600,000 while Barr lives in a posh sandstone terrace in one of Glasgow’s most sought-after neighbourhoods.

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The pair raked in £1.56million in housing benefit in 2012-13, £1.49million in 2011-12, and £1.45million in 2010 -11, meaning their firm banked £4.5million – entirely legally – in three years.

The astonishing amount of public cash being handed to the businessmen can be revealed as a result of a joint investigation by the Daily Record, our sister paper the Daily Mirror and the GMB union.

The GMB used freedom of information laws to force Scotland’s councils to provide a list of their top-earning private landlords.

The Bellgrove’s owners head the list of dozens of property magnates across the country making huge sums out of housing benefit – paid from public funds when tenants cannot afford their rent.

The amount made from the Bellgrove has tripled from £500,000 in 2000 despite it being described then as the “worst inScotland”.

Glasgow City Council stopped referring homeless people there in 2010 after deciding it made people’s drink and drugs problems worse.

But business is still booming for the well-heeled owners.

On an undercover operation to expose the conditions inside the Bellgrove, the Record discovered hundreds of residents living in cell-like rooms where barred windows look on to a filthy courtyard.

(Image: Daily Record)

Drugs are taken openly and residents guzzle cheap cider before passing out in stinking corridors.

Pools of vomit are left to fester on the floor of the windowless TV room and men use communal toilets and wash rooms.

The air is thick with smoke from cannabis joints and cigarettes as residents flout the ban on smoking in public places.

Unlike care homes, which are monitored by the Care Inspectorate, local authorities and the Housing Regulator, the Bellgrove is technically a private hotel.

All it needs to operate is a house in multiple occupation licence.

Gray and Barr, as well as being directors of the firm who run the Bellgrove, own the shares in the business along with Barr’s wife Marjory and Gray’s son Arthur.

(Image: Daily Record)

The Bellgrove was built as a working man’s hostel in the 1930s and was a classic example of “Thirties Moderne” with clean white lines, curves and coloured tiles.

But it has since been allowed to deteriorate into a crumbling drink and drugs den.

GMB Scotland regional secretary Harry Donaldson said: “These are shocking revelations.

“Public money is going into the back pockets of private landlords providing little more than squalid slum accommodation.

“There is a need for an urgent public inquiry to find out what other landlords are being paid from the two-thirds of housing benefit where the money is paid to tenants who then pay the landlords.

“We have no idea who these are and what standards of accommodation they supply.”

East End MSP John Mason last night said the Bellgrove was like a Soviet-era Russian prison.

He said: “The facilities are seriously out of date.

“Something that really struck me was the communal concrete shower block that could have been there for 60 years.

“It is in the private sector, but it isn’t regulated at all. I went to the Care Commission and said they should have a look at it. I am still waiting for an answer from them.

“My view is that it needs to be regulated. It is supported by public money and it should meet a certain standard.”

(Image: Daily Record)

Shelter Scotland head of policy Gordon MacRae said: “The use of hostels such as the Bellgrove Hotel are not the answer.

“Temporary accommodation should be a help up and not a hindrance for the most vulnerable groups in society.

“Evidence shows the use of hostels is not a sustainable way for people to secure a permanent route out of homelessness.”

A spokesman for Glasgow City Council said: “We stopped referring those affected by homelessness to the Bellgrove Hotel in 2010.

“Accommodating individuals in large-scale hostels makes it much harder to address the issues that led to their homelessness.

“Social care and health supports are available to those who stay at the Bellgrove and we look to assist residents back to mainstream housing wherever possible.”

A senior source at Glasgow City Council added: “I think it says everything that we stopped referring people to the Bellgrove in 2010.

“You could go into that place an alcoholic and come out a drug addict and an alcoholic.

“There is a very unhealthy drugs and alcohol scene that revolves around the Bellgrove, but many of the people who stay there gravitate to it for just that reason.”

Barr and Gray declined to comment last night.

Is your landlord coining it in from housing benefit? Contact us on 0141 309 3251 or reporters@dailyrecord.co.uk