Tag Archives: arrears

Half of private landlords have tenants on Universal Credit who are in rent arrears

We already know social landlords have been complaining about tenants falling into rent arrears because of Universal Credit.

This site has already commented on the Northern Housing Consortium, which warned that two-thirds of members said rent arrears were increasing, with 73 per cent of them blaming UC.

And of course the Financial Conduct Authority has said UC claimants have been turning to loan sharks because the so-called benefit does not provide enough money for claimants to pay their bills.

This means they must pay back the loans at enormous rates of interest, putting themselves even deeper into debt and putting all their possessions at risk.

Now we find that private landlords – who traditionally rent at higher prices than their social housing counterparts – are also concerned about tenants falling into arrears.

So not only is Universal Credit a failure because it pushes tenants into debt rather than ensuring their financial security, but it also pushes landlords into financial difficulty when claimants are unable to pay the rent.

Who, exactly, is it supposed to be helping?

More than half of private landlords say their tenants on Universal Credit have fallen behind on their rent payments in the last twelve months.

A survey by the Residential Landlords Associations (RLA) found that 54% of private landlords have tenants in receipt of Universal Credit who have rent arrears, putting them at increased risk of potential repossession.

Of these, 82% said that the arrears only began after a new claim for Universal Credit or after a tenant had been moved to the Credit from housing benefit.

And 68% of landlords said that there was a shortfall between the cost of rent and the amount paid in Universal Credit.

Landlords can ask the Department for Work and Pensions for rent to be paid directly to them, instead of to the claimant, but the RLA says it takes an average of 8.5 weeks for this to be set up.

The problem have become so dire that 62% of landlords fear their tenants won’t be able to afford rent payments when they are moved to the new benefits system, which is expected to be completed by December 2023.

Source: Half of private landlords say tenants on Universal Credit have rent arrears

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State of emergency: Universal Credit is about to roll over Luton and the effects will be devastating

Fit for purpose? Job Centres in Birmingham were targeted by a campaign pointing out the inhumanity of Universal Credit to former Employment and Support Allowance claimants.

This from Luton Today is self-explanatory:

“There are fears a significant number of Luton people on benefits could be considerably worse off as the rollout of Universal Credit hits the town next week.

“Luton Council is warning people they need to act now to see how they will be affected.

“From 24 October residents in postcodes LU1 and LU2 … may be affected by the introduction of Universal Credit (UC). Although a small number of individuals have been on what is called a ‘live service’ this will now be rolled out to ‘full service’, which will also include families.

“The council and its partners have spent a great deal of time in preparation and have put in place a number of measures to help those who are worried about the change.

“Trained staff will be located at Job Centre Plus in Luton to provide support for people affected by these changes. As well as this, council housing officers and staff serving at various reception centres around the town have been specifically trained in readiness for this significant change in the benefit system.”

As you can see, council workers are treating the rollout of the new(ish) benefit as though it is the beginning of a state of emergency.

If you don’t understand why they would do this, consider this:

“Liverpool MP Louise Ellman … told the House of Commons during a key debate on the welfare reform that landlords in her constituency are increasingly reluctant to rent their homes to those claiming it “because they are concerned about mounting arrears and failure to pay”.

“Also, Labour MP Stephen Timms asked the Secretary of State for Work and Pensions Esther McVey whether she would address the problems highlighted by recent research from the Residential Landlords Association revealing that a majority of its members are now not willing to let accommodation to Universal Credit payments.”

Then there’s this:

And this:

Add it all up.

If you are forced to claim Universal Credit, your home will be at risk, your children will be thrown into poverty and you will end up getting your groceries from a food bank.

Universal Credit is, of course, the Conservative government’s flagship social security benefit and the symbol of the Tory policy to make claiming benefits so difficult that people either take any job available to them, no matter how bad the pay and conditions, and then fight like rats in a cage to get something better, or simply die off due to starvation or suicide.

No wonder Luton is treating its rollout as a major disaster.

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Will direct payment cost social landlords £1.27 BILLION PER YEAR? – SPeye Joe

housingbenefit

Here’s a piece that builds on the warning that social housing tenants are likely to default on their rent if they believe their landlords are failing to carry out important maintenance work. Yr Obdt Srvt has experience of this but we’ll let Joe Halewood’s article speak for itself first:

This week Moodys, the ratings agency, getting very twitchy and saying that Universal Credit with its monthly payment of benefit to tenants and its direct payment of housing benefit to tenants rather than to social landlords as now, will see costs increase by 6.6%.  In a piece in Inside Housing it said that Moodys…

“…warned that the payment of benefit for housing costs to tenants ‘is likely to increase the risk of non-payment or underpayment of rent’. It pointed to an average 6.6% fall in rent payments recorded under Department for Work and Pensions demonstration projects trialling the payment of direct benefit.”

6.6%?

Inside Housing didn’t comment on this (now there’s a surprise!!) but they should and everyone involved in social housing should sit up and take notice. The national rent roll, the sum of all social housing rents is about £19.5 billion per year (4.1m rents at circa £90pw) so 6.6% of that is £1.27 BILLION PER YEAR

Welfare reform (sic) policy will directly lead to £1.27 BILLION less paid in rent to social landlords each year!!

If, as is widely reported, the bedroom tax has seen about £140 million or so increase in arrears to landlords then direct payments risk at £1.27 Billion is more than EIGHT times a greater financial risk.

An officer from the Welsh Assembly’s fair rent tribunal, with lawyer in tow, visited Vox Political Towers earlier this week (Mrs Mike having appealed against a bid to increase the amount of rent considered ‘fair’ on the building).

As the grounds of the complaint were mainly to do with the landlords’ failure to uphold their side of the contract (by not carrying out repairs, and with work such as grounds maintenance (grass cutting) taking place far less frequently than agreed), this was a perfect opportunity to point out, not only that awarding an undeserved ‘fair rent’ will merely add a burden to the taxpayer in housing benefit, but also that Universal Credit payments to tenants will mean a huge loss of income for social landlords as tenants withhold the money while they wait for the repairs they deserve.

There was no response other than acknowledgement of the comment but when this bomb drops – and it will – at least the authorities will not be able to say they weren’t warned.

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The spirit of Scrooge is haunting the DWP

Reginald Owen as Iain Duncan Smith in 'A Christmas Crisis-loan'.

Reginald Owen as Iain Duncan Smith in ‘A Christmas Crisis-loan’.

Here’s a tale of festive woe from the BBC News website:

More than 32,000 people have not received benefit payments in time for Christmas due to a Department for Work and Pensions “administrative error”.

The cash was due to go into bank accounts on Christmas Eve but will not now be paid until Friday, 27 December.

Most of those affected are first time claimants or people expecting one-off payments such as crisis loans.

The DWP urged them to call the department or a Jobcentre by 5pm to arrange payment within three hours.

A spokesman said the problem had only affected a “limited number” of claimants, totalling 32,200.

“The vast majority of regular benefit payments have been made on time this Christmas,” the spokesman added.

“However due to an administrative issue, a number of one-off or more irregular payments will now be paid on the 27th December, rather than the 24th.

“We have procedures in place to ensure that anyone who has been affected by this and who contacts us today (24th December) will get their benefits paid, usually within three hours.”

Some of those affected include new claimants waiting for their first payment, those owed arrears, people who have applied for Social Fund crisis loans and “in a very few cases” pension-related arrears.

The categories of benefits affected include Jobseekers Allowance, Employment Support Allowance, Social Fund and pensions.

We could all put a name to that “administrative error”: Iain Duncan Scrooge – I mean, Smith.

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Housing association speaks out over Bedroom Tax

131222perkins

It seems the chief executive of a local housing association has taken issue with yr obdt srvt over the Bedroom Tax.

Shane Perkins, of Mid Wales Housing, wrote to the Powys-based County Times after I used that paper to expose an illegal action by the county council’s ruling group, aimed at preventing discussing of a motion for the council to adopt a ‘no-eviction’ policy.

The motion asked the council not to evict tenants who fail to pay their rent because of the Bedroom Tax. Councillors who are also private landlords were forbidden from speaking or voting on the motion as they stand to benefit if social housing tenants are forced to seek accommodation with them as a result of the vindictive policy, and this meant 30 councillors had to leave the chamber.

Members of the ruling group, realising there was a real possibility of the motion being carried, then claimed that any councillors who are social housing tenants should also be barred from taking part – a move that is against the law (to the best of my knowledge). My understanding is that a ‘general dispensation’ allows councillors who are council tenants to take part in debates on, and vote on, matters relating to council housing.

Mr Perkins, writing in the paper’s December 20 edition, suggests that it is almost impossible to establish whether or not a tenant has fallen into rent arrears solely as a consequence of the “pernicious” (his word) Bedroom Tax, and claims that the motion was “a meaningless ‘political’ statement”.

He makes the point that it may be possible to apply the policy where the tenant has never previously been in rent arrears, but this would be unfair on other tenants who are similarly affected now but had fallen into arrears for other reasons in the past. He asks why tenants who struggle to meet their rent payments should not receive a financial subsidy or reward for being a good and conscientious tenant; and also points out that the cumulative effect of other regressive changes to benefits is also likely to affect the rent payments of vulnerable people and, to be consistent, Labour’s motion should encompass them also.

He says all social landlords, including the council, will seek to advise and support tenants who are in financial difficulty, but “in the final analysis, if a tenant fails to pay their rent, the ultimate sanction has got to be eviction.

“To do otherwise would be irresponsible, as ultimately the cost of one tenant not paying their rent is borne by all those tenants that do pay, and spiralling arrears will ultimately affect the viability of the council’s housing, which will serve none of its tenants.”

It would be easy to pick holes in his arguments. The whole point of government policy is to make sure that nobody gets a penny more than the Conservative-led Coalition decides they should have – and this government wants to drive people into poverty – so there will be no rewards for hard work. The Labour Party, and non-political groups, has campaigned ceaselessly to force the government into assessing the cumulative impact of its changes to the benefit system, but the government has refused all such calls, knowing as it does that such research would reveal the monstrous truth about its attack on the poorest in society.

If Mr Perkins is really interested, then he should encourage his own MP to support the call for such an assessment in the debate on the ‘WoW’ Petition, due to take place in the House of Commons in the New Year. I helped write that document, which calls for (among other things) “a cumulative impact assessment of welfare reform”. Labour is supporting the motion. I would suggest, therefore, that any criticism of Labour for making a “meaningless ‘political’ statement” is unfounded.

As for the difference between tenants affected by the Bedroom Tax who have never been in arrears before, and those affected by it who have – this should be something a social landlord can track, especially if they are actively seeking to “advise and support” tenants. This support should include examination of a tenants income and outgoings, before and after the Tax was imposed.

The simple fact is that Mr Perkins would move offending tenants into smaller houses if he had any, but he doesn’t. He would not be talking about eviction if he did. He never built them and we must conclude that he never saw the need. Perhaps he believed that the welfare state would continue to support his tenants.

William Beveridge, the architect of that system, in the report that bears his name, said the British government should fight what he called the “giant evils” of society, including Want.

How could Beveridge know that, 70 years later, the British government would be actively increasing Want, wherever it could. That is what the Bedroom Tax, and the benefit cap, and all the other cuts brought in by this spiteful Conservative-led Coalition are about.

These measures are crimes against the citizens of this country – citizens who have paid into the State, generation after generation since the 1940s, believing that it would look after them if the spectre of Want cast its shadow at their door.

Mr Perkins describes the changes as “pernicious”, but if he allows a single tenant to be evicted then he will be a willing accomplice.

That is what he is saying when he tells us he is prepared to use this “final sanction”.

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Mail and Telegraph silent as research proves Rolnik right

[Image: Anti-Bedroom Tax and Benefit Justice Federation]

[Image: Anti-Bedroom Tax and Benefit Justice Federation]

This is how the right-wing media try to stifle popular protest against their masters – by trying to distract attention away from the facts.

There can be no doubt about what today’s big news story is: According to the Daily Mirror, hundreds of thousands of families have been put into rent arrears because of the ConDem government-imposed Bedroom Tax – and, according to the Independent, 50,000 of those people are now facing eviction.

Isn’t that exactly what the United Nations special rapporteur on adequate housing, Raquel Rolnik, was saying at the end of her recent tour of Britain to investigate the effect of the Bedroom Tax (often wrongly described as the spare-room subsidy. A subsidy would give money to people; this takes it away)?

Article 25 of the Universal Declaration of Human Rights (to which the UK is a signatory) includes housing as part of the “right to a standard of living adequate for the health and well-being of himself and of his family”.

But Ms Rolnik said that in Britain “the most vulnerable, the most fragile, the people who are on the fringes of coping with everyday life” were being hit hard by the policy – and called for it to be abolished.

In response, the Daily Mail (in particular) attacked Ms Rolnik – on the grounds that she was “a dabbler in witchcraft who offered an animal sacrifice to Marx”. How this relates to her Bedroom Tax investigation has yet to be explained.

The alleged newspaper published a series of character assassination pieces on the internationally-respected United Nations special rapporteur, in which it criticised her for staying in a £300-a-night hotel (booked on her behalf by the United Nations and nothing to do with her personally), and for being born in a country (Brazil) that it described as “violent” and “slum-ridden” (an accident of birth).

It also quoted some stupid Tory lucky-to-be-an-MP called Stewart Jackson, who said she was a “loopy Brazilian leftie”.

But none of its claims about her mission – or those of the Tory MPs it quoted – were true. All were refuted within a day of being voiced.

Today, the Mail thinks it is more important to tell us that the B&B owners who refused to let a gay couple stay on their premises have been forced to sell up because of lack of business.

That other bastion of Conservatism, the Torygraph, tells us that Conservative MPs are on a mass outing to Chipping Norton today. How wonderful for them.

One couple for whom Chipping Norton isn’t wonderful consists of Toni Bloomfield (25), who lives there with her partner Paul Bolton (42) and his four children.

“I have to pay £98 extra a month since the bedroom tax came in,” she told the Independent. “We’ve got a four-bedroom house and Paul’s four children, aged between two and eight, live with us. Before the school holidays we were struggling and now we’re nearly three months behind on rent.

“The children get free school meals and feeding them through the holidays was tough. Paul and I are only eating in the evenings two or three nights a week to make sure we can put enough food on the table. We’re not working, but not out of choice. Trying to find a full-time job here is a nightmare.”

Chipping Norton is the home of David Cameron, when he isn’t pretending to be the Prime Minister, and lies in his constituency of Witney. If people in the Prime Minister’s constituency can’t get on in life, what hope does anyone else have?

It would be interesting to hear more from Mr Bolton and Ms Bloomfield. What is it like, living below the breadline in the home of the infamous ‘Chipping Norton set’? Do they rub shoulders with Jeremy Clarkson down the supermarket (when they can afford to go)? If so, would they kindly suggest to him that he lay off the drink for a while, as it’s encouraging him to say silly things about standing for election?

The information supporting the story was supplied by campaigning group False Economy, which submitted Freedom of Information requests to local authorities across the UK. Of these, 114 replied, providing the figure of 50,000 tenants threatened with eviction.

As not all local authorities responded, the newspaper stated that the total number of affected council tenants was likely to be much higher.

Separate research by the National Housing Federation swells this number by 30,000 housing association tenants, the Independent states.

Clifford Singer, campaign manager for False Economy, said: “Together with the raft of other benefits cuts the Government has forced through, both this year and previously, the bedroom tax is driving tenants and families who were just making ends meet into arrears, and pushing those who were already struggling with the cost of living into a full-blown crisis.”

The Daily Mirror‘s report estimated 330,000 families to have fallen behind with their rent, including around 165,000 who always paid on time in the past.

The reality of the situation is that it shows how badly wages have slipped since Margaret Thatcher came into power with all her silly neo-liberal drip-down economic theories. The Bedroom Tax is a threat because working people do not earn enough to pay the rent along with all their other overheads. This is why the Housing Benefit bill has blown up to huge proportions; if only the unemployed were claiming it, it would be manageable. Employers are to blame – partly.

And who really benefits from Housing Benefit? Not the tenant! No, the people who really receive Housing Benefit are landlords. This is why some, including this blog, have called for it to be renamed ‘Landlord Subsidy’. So part of the blame must also lie with them and the amounts they charge – especially for council houses, where the money never really leaves the local authority’s bank account; it would go out, only to be paid straight back.

So we can say that the debt into which these people have fallen is not their fault; working people should be paid enough to be able to cope, and the unemployed should be able to rely on the state to support them until they can get back on their feet – without the state, itself, going into debt.

It has been created because, somewhere along the line, somebody has been taking too much money for themselves.

What is really to blame?

Greed.