High Court rules DWP’s Universal Credit deduction scheme unlawful
1 year ago | 38 comments
Government to overhaul landlord benefit deduction scheme
9:30 AM, 26th February 2025, 1 year ago
32
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.
Tags:
DWP landlord payment review, Landlord benefit deductions UK, Liz Kendall welfare changes, Tenant debt protection UK, Universal Credit reform 2025, Universal Credit repayment rate
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Member Since May 2018 - Comments: 1999
1:00 PM, 27th February 2025, About 1 year ago
Reply to the comment left by TheMaluka at 26/02/2025 – 11:20I used to take benefits tenants many years ago but would not do it any more.
My current tenants have the right to live and work in the UK and would previously have been called economic migrants before they were given these rights. The tenants are not perfect but they are much less risk than benefits tenants. And of course it is not financially sustainable to take on either benefits tenants or homeless people if neither the government nor a charity commits to paying you.
Some of those skilled and hard-working people from the Ukraine and Poland make great tenants.
Member Since March 2023 - Comments: 1506
5:41 PM, 28th February 2025, About 1 year ago
Best one I have heard yet is that the tenant (not one of mine) had an emergency as she broke her phone, and was forced to buy a £1000+ Apple iphone – hence she couldn’t pay her rent that month, or feed herself or put petrol in her car. Thank god for food banks
Member Since September 2024 - Comments: 33
8:02 AM, 15th March 2025, About 1 year ago
As a landlord, I am deeply concerned about the current state of the system. I have $28k in unpaid rent that continues to accumulate, with no resolution in sight as the courts move at a glacial pace in evicting tenants. This situation has persisted for 16 months, and the tenant continues to live comfortably, even planning to install new high-speed internet and buy a larger TV during my last visit.
It feels like the system is fundamentally broken and irreparable. The current leadership, in my view, has failed to address these issues, and it’s hard to see any positive changes ahead.
As a result, landlords like myself will no longer be willing to rent without strict guarantees and harsher terms and conditions in tenancy agreements. There is no justice for landlords who are innocent in these situations. Even my repeated requests for direct rent payments through Universal Credit have been denied.
In my opinion, the whole system is beyond fixing, and there is a complete lack of confidence in the government’s ability to manage this issue effectively. When you have jokers running the country things become beyond repair.
Member Since May 2015 - Comments: 2188 - Articles: 2
8:54 AM, 15th March 2025, About 1 year ago
Reply to the comment left by Jagdish Patel at 15/03/2025 – 08:02Yet more reasons to avoid benefit tenants. When all the benefit tenants are homeless, perhaps the government (of whichever party) will come to realise that landlords will only accept high risk tenants with guaranteed rent in advance paid direct to the landlord.
Watch out for those flying pigs.
Member Since March 2023 - Comments: 1506
9:16 AM, 15th March 2025, About 1 year ago
Reply to the comment left by Jagdish Patel at 15/03/2025 – 08:02
What you could do is take the tenant to court for ONE MONTHS rent – use the on line MCOL service and that will give the tenant a CCJ, thus depriving them of any kind of phone upgrade, internet service upgrade or credit
Member Since February 2016 - Comments: 1056
9:38 AM, 15th March 2025, About 1 year ago
Reply to the comment left by GlanACC at 28/02/2025 – 17:41
Some years ago one of our tenants quite proudly told us he had spent December’s rent on Christmas presents and treats for his young son. For some, the roof over their head seems not to be a priority.
Member Since September 2024 - Comments: 33
9:53 AM, 15th March 2025, About 1 year ago
Reply to the comment left by GlanACC at 15/03/2025 – 09:16
Thanks, GlanACC, but how will this actually help resolve my situation? I’m buried in debt, and spending more money on CCJs to prevent tenant from getting internet won’t fix my rent arrears. I’ve reached out to numerous senior government officials, but it feels like they’re just sitting back and watching the situation unfold. In my opinion, the entire judicial system is beyond repair.
Member Since May 2015 - Comments: 2188 - Articles: 2
10:06 AM, 15th March 2025, About 1 year ago
Reply to the comment left by GlanACC at 15/03/2025 – 09:16
I always take my tenants to court for even minor arrears, incurring the minimum court fee of £35. This severely affects their financial life. I have never had a tenant defend.
Member Since March 2023 - Comments: 1506
11:01 AM, 15th March 2025, About 1 year ago
Reply to the comment left by Jagdish Patel at 15/03/2025 – 09:53
It won’t help your situation BUT if you take the tenants to court for £300 it will only cost you £35 and bugger them up for 6 years
Member Since May 2015 - Comments: 2188 - Articles: 2
11:59 AM, 15th March 2025, About 1 year ago
Reply to the comment left by GlanACC at 15/03/2025 – 11:01
Then just before the six years is up, take them to court for another £300. Buggers them for a total of 12 years.
Remember the rules are that you have to give service at the last known address, which will normally be your property, even if they have left.