I've only ever been on the tennant side of things myself, but from talking to a friend of mine I know where you're coming from on the wrecked house Lucy. The last lot of tennants they had completely trashed the place - the only reason they (just) had enough money to cover the damage out of the security deposit was because him and his family spent the best part of a week doing the repairs.
This government "initiative" is nothing more (IMO) than a way to make things easier for them, claim they're helping people while dumping the bill on the public.