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Landlords reject direct payment plans


Published by 24publishing for in Housing and also in Communities, Finance, Local Government, Universal Credit

Landlords reject direct payment plans Landlords reject direct payment plans

Private landlords would be less likely to rent to benefit claimants if it is up to councils to decide whether housing benefit can be paid direct to the landlord after tenants reach eight weeks arrears.

That was the result of a survey of 1,000 private landlords across the UK - who were quizzed on their views about Universal Credit - carried out by the Residential Landlords Association (RLA) and the Scottish Association of Landlords. 

At present when a tenant on housing benefits reaches eight weeks of arrears on their rent a landlord can demand that the council make payments directly to the landlord.

However, the RLA and SAL say that in September Government ministers failed to provide a “clear pledge to retain the policy”. Asked how they would respond if the ‘right to demand’ direct payment became only a ‘right to request’, 91.6% of landlords said it would make them less likely to rent to those on benefits.

In addition, 62.3% said they would not be prepared to lower rents in return for the direct payment of housing benefit. This despite claims by Lord Freud last week that the temporary scheme to enable private landlords to receive direct housing benefit payments in return for dropping rents has been a success.

He told the National Landlords Association annual conference last week: “In London alone, a third of claimants who tried to re-negotiate their rent received a rent cut. This arrangement will stay in place for housing benefit claimants, prior to the move to Universal Credit." 

A further concern was landlords’ reaction to a change in the housing benefit rules in January which has seen the age limit at which claimants can claim only for a room in shared housing increased from 25 to 35.

Asked whether there was sufficient numbers of shared properties to meet the extra demand – based on their experiences – 54.6% of landlords said there wasn’t.

Alan Ward, chair of the RLA, said the results clearly show deep concern on the part of landlords about the direction that the Government’s Universal Credit policies are taking.

He said: “The uncertainty being created by Ministers’ failure so far to issue regulations concerning the circumstances under which payments would be made directly to landlords is causing uncertainty for landlords and concern about renting to those on benefits.

“Ministers have already allowed payments to be made directly to landlords in Northern Ireland and now even housing associations they picked to pilot payments to tenants have deep concerns about the impact of the policies being pursued.

“We call on Ministers to abide by the election commitments made by both parties in the coalition and trust tenants to make their choice over who should receive the housing element of Universal Credit.”

The survey found that 65.2% of respondents do not support the Government’s plans for Universal Credit.



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