Opinion: ‘Welfare reform will change the way we work forever’
Published by Jon Land for 24dash.com in Housing and also in Universal Credit
Opinion: 'Welfare reform will change the way we work forever'
The Housing Quality Network (HQN) has just published the results of a survey it carried out into the impact of welfare reform. Here, chief executive Alistair McIntosh shares some of the findings and discusses what the Government's policies will mean long-term for housing providers.
“Why should I, in my four bedroom detached house, get the same heating allowance as somebody in a bedsit?” That’s what a guy I used to work with said as a joke when his payment came through. He didn’t need the money and thought the government was daft.
Rich pensioners still get the heating allowance at the same time poor people see cuts to their benefits. So this has nothing to do with fairness. Now we have got the politics out the way we can look at how landlords are getting ready for welfare reform.
HQN asked our members what they were doing to prepare for the changes. We got a good picture of what is going on from the 100 or so replies. The big message is simple. Landlords are doing a great job of briefing tenants by all means necessary. They are knocking on doors, sending letters and using social media. I think they have contacted every tenant in the land. We will find out if they have actually been listening soon enough.
Some tenants will really suffer. The bedroom tax will take between £12 to £30 a week away from them. Not too many will be swept up by the benefit cap in our sample. But it is very bad news indeed for those that are affected. We came across families that will lose £150 to £350 a week.
Landlords are trying to move these people into smaller homes. Will this be successful? Almost every one says they don’t have enough homes of the right size. Where they do crop up landlords are helping tenants to trade down. Tenants get help with removal expenses and cash incentives to make it easier to move. A couple of landlords are offering up to five thousand pounds. Most offered a lot less.
Landlords are really stepping up to the plate. As a military man, Iain Duncan Smith must appreciate all the planning that is going into this. I have two concerns.
Firstly, how much is this all costing? Money doesn’t grow on trees for councils or associations. Our survey tells us that personal contact is the best way of getting tenants to understand the changes and help them to move home. When arrears go up I am sure we will return to door-to-door collection. How else will we compete with Wonga for the pound notes? One landlord has told staff that they will no longer be the friends of tenants. Your job is to take them to the cash point and bring back the rent money. There is not an app for this. I think we will see many more people working on income collection.
My next worry is about what happens to tenants in arrears. A few landlords are talking tough. It is business as usual so if they don’t pay out they go. Many more are taking a different line. They will look at each case on its merits. If the arrears are due to cuts they will try to close the gap with hardship funds. Some landlords will let you move even though you have arrears. I know that you cannot get blood out of a stone but is it realistic to keep tenants that just can’t afford the rent? We are in uncharted waters.
My prediction is that welfare reform will change the way we work forever. We will be spending more money to collect less rent. This is the issue that could tip the balance and drive consolidation. Landlords are working together to find the right sizes of homes for tenants. Will they join forces on debt collection? Could this lead to even closer alliances to save money? The words of Benjamin Franklin spring to mind – “We must all hang together, or assuredly we shall all hang separately.”
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