OP,
There are probably loads of people playing the system, embellishing their circumstances to their advantage or outright lieing.
They are usually people who cannot afford to support themselves and the income they do get is woefully inadequate, so they look for ways to top it up.
I think most of your frustration comes, not from what other people are 'getting away with', but from your frustration at your own life.
You're knackered, running around trying to keep all the balls in the air, feel like you are struggling, which makes you especially triggered by your neighbours.
The thing is, you can't control what your neighbours do or don't do, so your passion and energy would be better served attempting to control what you can, which is your own circumstances.
If you weren't struggling, you wouldn't be as invested in the comings and goings of your neighbours, unless you were a busy body and I don't feel that is the case.
Focus on what you can do to improve your situation, that's where your power is.
Even if the authorities prosecuted your neighbours, they'll always be other people doing it, and exactly how would that change your own circumstances? Would it relieve your own struggles?
You are putting so much energy into thinking about what other people are doing, how you can stop them doing it, wouldn't it be more beneficial to you to plough all that thought and energy into improving your own life?