Landlords are now able to apply directly for alternative payment arrangements (APA) for tenants on Universal Credit.
The Department for Work and Pensions (DWP) has issued a statement revealing that since the end of last month, landlords have been able to ask for an APA to be set up provided they can prove the tenant is in arrears of two months or more.
Previously they needed the tenant’s consent to apply, meaning many landlords were left struggling with rent arrears.
The Residential Landlords Association, which says it was instrumental in the change, is also claiming that 73% of landlords still lack confidence in renting to Universal Credit tenants because of fears they won’t be able to recover arrears.
Its claims come with a Parliamentary debate due this morning.
Critics of Universal Credit, which rolls up various benefits into one, has proved contentious because of the delays claimants have faced before they receive their money.
Chancellor Philip Hammond was forced to make changes to Universal Credit in his Budget last November, announcing that claimants would be eligible from the day they apply, rather than after seven days, while housing benefit will continue to be paid for two weeks after a claim.
But the RLA says more reforms were needed and has pointed to examples of its members’ experiences.
It highlighted the case of Brandon Taylor from Lowestoft, Suffolk, who provides homes to rent to around 130 Universal Credit claimants, of whom 70% are struggling to pay their rent in full and on time.
One tenant on Universal Credit ran up £2,848 in rent arrears but when Taylor applied for an alternative payment arrangement to enable payments to be paid directly to him, he says his requests to DWP were ignored.
The RLA also cites the experiences of Sue Thompson and her husband Phil who rent out properties across north-east England. Many of their tenants are in receipt of Universal Credit.
Thompson said that although the Government has slightly reduced the time between applying and receiving Universal Credit, many tenants in arrears means that many are forced to “beg, steal or borrow” to keep going.
RLA vice-chairman Chris Town said: “We welcome today’s debate and hope that MPs from all parties will agree that a few pragmatic changes to the way Universal Credit is delivered will lead to considerable improvements for both tenants and landlords.”
Yesterday, a DWP spokesperson told EYE: “The majority of claimants are comfortable managing their money, but we are increasing support to help people who need it to stay on top of their payments. From April, people in receipt of housing benefit will receive two weeks’ rent when they move on to Universal Credit.”
Today’s debate, in Westminster Hall, looks at the impact of Universal Credit on the rental sector. It is led by Liberal Democrat MP Stephen Lloyd.
Hopefully Propertyindustryeye will be able to give us a report/summary on what is covered in the debate.
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