simple answer is i would call the citizens advice bureau, just ask them what are your rights on this.
I dont personally want to recover this deposit.Flip reverse it. Get your own debt collectors to hassle him to get your deposit back. I've seen it done before and its surprising how fast a cheque appears through the letter box.
It does seem 'unreasonable' of the landlord, if he has inspected the property and is satisfied that there is no damage that he will now not accept the deposit to remedy this situation, as surely it is in the interests of all parties to end the matter as quickly as possible and to move on.^^
I wish it was that simple.
A culmination of things made paying it impossible (its not through my own idiocy I can assure you) I lost my job, another one, but I'd gladly use my deposit to pay it off! I'm willing to do this, but the landlord wont allow it. It baffles me!