Details of the Government’s new procedures for the payment of universal credit have been released and they confirm that a private landlord’s right to insist on direct rent payments if a tenant is in arrears will be scrapped.
The Residential Landlords Association, which represents around 15,000 private landlords, reacted with anger.
It said that when the new benefit system is introduced, payments will be made directly to tenants ‘and it will be up to them to pay their rents or not’.
Currently, Local Housing Allowance is paid directly to tenants who live in private rental accommodation. However, landlords can ask for it to be paid to them if the tenant falls into arrears or is declared vulnerable.
With universal credit – due to come into force next year and include benefits such as housing allowance – the new procedures will apply across the board to local authority tenants, housing association tenants and tenants in the private rented sector.
The RLA has raised a number of serious concerns about the proposals, saying that there is no right of redress for landlord if things go wrong, and that the whole concept creates risk for landlords. It has also attacked the proposals for lack of clarity, saying they have replaced ‘regulations’ with ‘guidance’.
It says that landlords will become increasingly unwilling to accept tenants on benefits.
Richard Jones, the RLA’s policy director, said…
“We strongly believe that the Government’s whole approach is flawed, and although the objective of helping tenants to manage their financial affairs is in isolation a laudable one, the Government has wholly failed to appreciate the consequences of this”.
“There will be a much higher level of arrears, an unwillingness of landlords to house benefit claimants (at a time when there is huge pressure on social housing), increased unwillingness by banks to lend for this kind of property (or increased interest rate to reflect the risk), much higher levels of evictions and much greater homelessness.”
Let us know your thoughts…
Ive been in a meeting last week, with the DWP rep, who has advised thats nothing has been decided, and nothing has been rulled out. Its yet to go through parliament, back end of the year so we were told, so I got the feeling everythings up for grabbs/wishy washy as usual. Instead of the government using the knowledge from local govt, and housing benefit, they are going for broke and brokering anew deal. Keep campaining and sending letter to ministers or who ever might listen nothing has been decided.
Lets not beat about the bush on this piece political correctness. Families will be made homeless. and probably on the streets. on the streets unless the local council can house them. Landlords will be spending most of their time chasing the rent, and down at the court. The reason the government is not being is many landlords will not be renewing the tenancies on DHS tenants who they consider risky.
The Conservative party came into power with the promise of a tenants choice of direct payment or not, now they are taking this away, I have a number of benefit tenants and I know with pass losses that if they can not be forced to pay the rent they will not. I have a number of cases where the months (or two) rent has gone in drugs and drink over the course of a weekend. And once its gone its gone.
Why pay the landlord his rent when there are a lot more important things to spend it on, after all he’s rich and can afford it can’t he.
I noticed before when LHA was brought in that it did not affect the local authority tenants or housing association tenants at all they kept the direct payments.
They (the conservatives) came in with a promise of help but what have they done reduced the rent in a number of ways increased the single room age and also cut that down reduced a number of other housing benefits when the person is in jail or in hospital uncoupled the link between increased cost rents levels.
The amount of homelessness will of course increase and a large amount of landlords will stop benefit tenants altogether
The Conservative party has lost me forever see how good they are when the housing associations go to the banks who quite rightly refuse them any loans abnd no private sector funds or houses to help
I am sorry but this will break me as I am at a age now 62 and been doing this for 23 years that everything seems to be stacked against the landlord. I will end up shutting my houses down and selling for what I can get. Then sodding off to some where warm where the tax man can’t find me.
Does any body want to come