Government to overhaul landlord benefit deduction scheme

Government to overhaul landlord benefit deduction scheme

9:30 AM, 26th February 2025, About 2 months ago 32

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The government is to scrutinise a controversial mechanism allowing landlords to request rent directly from tenants’ benefits.

It follows a story on Property118 and recently in national media about Nathan Roberts successfully challenging deductions from his benefits.

They had been automatically redirected to his landlord for arrears and ongoing rent, despite a dispute over property repairs.

Now Work and Pensions Secretary Liz Kendall says a review will address growing unease that the practice, intended to prevent evictions, might instead be placing tenants into financial hardship.

The decision follows the Department for Work and Pensions (DWP) choosing not to appeal the court ruling.

Under the current setup, a digital system greenlights landlord applications to withhold up to 20% of a claimant’s monthly Universal Credit without input from either the tenant or the DWP.

This has sparked concerns over fairness and transparency.

Approval of landlords’ requests

Ms Kendall said: “I am determined to right the wrongs that have persisted in the benefits system for too long.

“The automatic approval of landlords’ requests for tenants’ benefits to be deducted is one of these.”

She added: “As well as urgently reviewing this system, I am bringing forward major changes to the health and disability benefits system so that it works for everyone, underpinned by the biggest employment reforms in a generation.

“We will continue to listen to people’s concerns, and transform our benefits system to one of fairness, not punishment.”

Benefits system needs reform

The Minister for Social Security and Disability, Sir Stephen Timms, said: “The benefits system needs urgent reform, and we are taking action across the board to do this – whether that’s tackling the huge accumulation of debt by Carer’s Allowance recipients through no fault of their own, or this automatic deduction of benefits purely at the request of a landlord.

“Combined with our efforts to Get Britain Working and our upcoming health and disability benefits reform, all of this will lead to better support for those who need it, and open doors for those who can work.”

The DWP says it now plans to explore alternatives, ensuring landlords receive due payments while safeguarding claimants from spiralling debt.


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Cider Drinker

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9:58 AM, 26th February 2025, About 2 months ago

It’s not paying one’s bills and spending rent money on alcohol, drugs and unnecessary luxuries that causes financial hardship.

Landlords face financial hardship if rent isn’t paid.

This will lead to people having financial problems AND no place to call home.

Gromit

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11:13 AM, 26th February 2025, About 2 months ago

... another reason not to take tenants on benefits.

TheMaluka

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11:20 AM, 26th February 2025, About 2 months ago

Tenants have to produce a tenancy agreement before the DWP will pay the rent, which can then be used for anything. What a self-destructive system, and one which deters landlords from housing Benefit Tenants. As my Benefit Tenants leave, usually be winning a Darwin award, they are replaced by working individuals.

Freda Blogs

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14:36 PM, 26th February 2025, About 2 months ago

I hope they'll also redress the imbalance whereby tenants don't have to pay rent to LLs even though they've received the money for it?

I suspect not - the disdain with which Ms Kendall says "this automatic deduction of benefits purely at the request of a landlord" speaks volumes about her opinion of us.

Robin Wilson

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14:48 PM, 26th February 2025, About 2 months ago

There are tenants who instead of passing on the housing benefit to the landlord as rent, will instead use it to buy airline tickets to go and visit their relatives in USA and Tenerife. What does Ms Kendall propose to do about that? If landlords were fraudulent you would never hear the end of it, but for tenants they can have all the rights they want, even unlawful ones.

TheMaluka

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7:50 AM, 27th February 2025, About 2 months ago

Reply to the comment left by Robin Wilson at 26/02/2025 - 14:48
Robin the point is that using the rent money for personal pleasure is a tenant's right, the little darlings are doing nothing wrong in the eyes of the government.
Yet another reason not to take benefit tenants.

Markella Mikkelsen

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9:00 AM, 27th February 2025, About 2 months ago

Agree with all the comments above. I don't take benefit tenants any more.

If Ms Kendall wants to overhaul the benefits system and make it fairer, then the housing element of the UC (which after all is there to pay housing) should be paid direct to the landlord.

This one simple action will reduce the risk of eviction and LL may once again start considering benefit applicants.
How difficult can this be?

TheMaluka

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9:04 AM, 27th February 2025, About 2 months ago

Reply to the comment left by Markella Mikkelsen at 27/02/2025 - 09:00
How difficult can this be?
Too difficult for cabinet ministers!

Cider Drinker

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9:12 AM, 27th February 2025, About 2 months ago

Reply to the comment left by Markella Mikkelsen at 27/02/2025 - 09:00
If government did a U-turn to encourage landlords to accept tenants on UC, who in the right mind would accept tenants on benefits? We would always know that the rules could be changed at the stroke of a pen.

Gromit

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11:42 AM, 27th February 2025, About 2 months ago

Reply to the comment left by Cider Drinker at 27/02/2025 - 09:12
They'd also need to remove the repayment sanction on rent paid directly to Landlords if the Claimant (tenant) made a fraudulent claim.

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