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Thursday, March 06, 2014

Universal Credit direct payment worries

Here's a worrying update from trials of the new Universal Credit over in Wakefield.

A pilot scheme where 1000 tenants living in public sector rented housing were paid their Universal Credit as a direct payment led to a £241,000 rise in rent arrears.

These results probably come as no surprise to many landlords.

The results were reported at the Chartered Institute of Housing South East Conference by the  Chief Executive of Wakefield Housing who went on to report that from the 1,000 tenants involved in the pilot, 400 had to be dropped after reaching eight weeks of rent arrears.

The aim of direct payment of Universal Credit was to encourage people to take responsibility for their finances. It strikes me it will help nobody other than the 'paydayloan sharks', who all must be rubbing their hands with glee with the potential roll out of this policy.

A Department for Work and Pensions spokesperson said: ‘Direct payments are an important part of universal credit to make it easier for people to move into work, but we’ve been clear from the outset that we will take steps to ensure vulnerable people are protected."

‘This is exactly why we ran the Demonstration Projects to help us put the right protection in place for both tenants and landlords, and why the findings have been so very useful.’

Let's all hope that the Government gets realistic. Otherwise the already diminishing number of private sector landlords willing to rent to tenants receiving benefit will diminish even further.

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Anonymous said...

A massive 40% now face eviction because of this scheme. Is that fair?

Doug said...

The landlords of a massive 40% of the tenancies in the scheme now face the hassle/expense of tenancies gone wrong, after having decided to help out the local authorities by making their accommodation available to scheme participants.

The PRS is heavily relied upon yet largely unacknowledged and unappreciated. It is no wonder many landlords insist on working, financially independent tenants. I do, and all my flats are in grim, provincial, depressed, social security-dependent areas.