The owner of a property management company in Devon has had to evict three tenants after the Department for Work and Pensions (DWP) failed to make payments for claimants rent as part of Universal Credit. He has also been instructed by landlords not to rent to all benefit claimants so as not to cause a repeat of the issues that have already occurred.
No longer accepting benefit claimants
Mark runs a small property management company in Devon. Since the roll-out of Universal Credit in his area 60 of the 64 properties he rents to no longer accept any benefit claimants as tenants. This is part of a rising trend across the country following the troubled introduction of the governments flagship benefit.
The National Housing Federation (NHF), the body which represents housing associations across the country told Sky News that 77% of tenants that are on Universal Credit are in rent arrears. This compares to 29% when the tenant isn’t on the new benefit. Still the government claims that their is no link.
Bayard who used to work for the DWP wrote a very detailed article on the issues with housing payments which I recommend you read by clicking here.
Landlords can’t risk it.
Mark who is only the agent of the properties in Devon, told me how he has lost approximately £5000, with the landlords he manages for losing much more.
He went on to say how he’s also been told to refuse claimants who are on Employment and Support Allowance (ESA). The council will try to reassure him that as the tenants are on ESA the rent will automatically be paid direct to the landlords. However with existing legacy benefit claimants like those on ESA being transferred to Universal Credit from next year landlords can’t risk it.
In recent months he has been forced to evict three tenants because of the Department for Work and Pensions (DWP) not replying to him. He had tried to set up an Alternate Payment Arrangement (APA) to have the rent paid directly to the landlords but received no response.
While sympathetic to the tenants he said “Landlords need the rent.”
Growing pattern across the country
This is not an issue that is isolated to Devon. The Highlands where I live was the original pilot area for the new benefit in 2013. The council’s finance officer told The Work and Pensions Committee in June that rent council house rent arrears rose to over £2 million in 2018. He went on to add that 81% of those in arrears are on Universal Credit.
He was hopeful that this will reduce following the devolution of housing payments to the Scottish Government.
Unlike England and Wales tenants in Scotland can now ask to have rent paid directly to their landlord from the beginning of their claim. The DWP has refused to follow suit in the rest of the country as it goes directly against their plan for Universal Credit.
Part of the reasoning for claimants receiving their rent payment was to teach them to manage their money as if they were in a job. For the DWP to change this now would be seen as a defeat.
However with so many being left short due to DWP errors or deductions, people are left between choosing to pay the rent or buy food for their families. I know which I’d be doing.
Just another example of why it should be stopped
Tenants being evicted and landlords losing thousands of pounds is just another reason why the government should halt and scrap Universal Credit. With another 7 million people still to be transferred the housing market simply cannot take the loss anymore.
With private landlords refusing to take those on benefits this is increasing pressure on already cash strapped councils to house claimants.
In short claimants can’t afford it, private landlords can’t afford it and local authorities can’t afford it.
It’s high time the government act to negate the risks it’s placing on the most vulnerable in society. The welfare system is meant to be a safety net but that net now has so many holes people are slipping though and suffering.
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