Housing benefit and direct landlord payments

I have always had housing benefit paid directly to me. All one needs to do is add the following clause to the tenancy agreement:

If the tenant is in receipt of Housing Benefit the Landlord must be paid directly by the local authority acting for the claim. If the Housing Benefit is not paid directly to the Landlord either during the initial fixed term or during a periodic term, then eviction proceedings may commence

and provide a letter from the tenant to the council where the following is included:

Please note that it is a condition of my tenancy that any housing benefit that I am entitled to, is paid directly to my Landlord and if the housing benefit is paid directly to me I may be evicted as detailed in the Tenancy Agreement. I request that the council assists me to secure and retain my tenancy in this respect.

For your reference, The Housing Benefit (Amendment) Regulations 2010 includes a regulation where Housing Benefit may be paid directly to the landlord. This additional clause (iv) that has been added to Regulation 96(3A)(b) is detailed below:

(iv) the relevant authority considers that it will assist the claimant in securing or retaining a tenancy

With the above, tenancy clause and the wording included in a letter to the council I have always had the benefit paid directly to me. On one occasion it was paid to the tenant who ended up being about five months in arrears and was evicted. I then contacted the council and appealed against their decision to have not paid me and also informed them that I would refer them to the Local Government Ombudsman and I ended up getting all the rent owed paid to me.

Now, that the dreaded Universal Credit is with us, I have several tenants in arrears and it appears that UV are a law unto themselves where they have an open hand to do as they like. I am looking for a resolution as to how to deal with them so if there is anyone with experience in holding them to account and getting somewhere please do let me know

Sounds as though you’re very clued up Clint.

Yes, there’s a regulation that says that councils can pay directly if this will help the tenant retain their tenancy.

It also sounds like the housing benefit offices you deal with have been better at exercising this discretion than some I’ve come across.

Absolutely agree that the key is to appeal or complain if they don’t correctly apply the rules.

I wrote the guide because in my experience not all councils are as good, and that many tenants and landlords (or even in some cases housing benefit decision makers!) are not aware of the rules.

Agree also about your comments about universal credit.

Mark

An excellent guide Mark for both tenants and landlords. Thank you.

Hi Mark

For future editions of the guide, could you perhaps include the situation where a landlord asks for 2 months rent in advance at the start of a tenancy (and this is stated in the AST), because I believe that in such a situation the Housing Benefit should be paid direct to the landlord straight away (as the tenant already has arrears of 8 weeks/2 months)? However, I find that councils are sometimes refusing this and substituting their own rule/interpretation, i.e. tenant cannot have 8 weeks/2 months rent arrears at the outset of a tenancy agreement.

Thank you.

Hi Robert

Sorry for the delayed response!

Sounds as if the council in this instance was particularly unhelpful.

I think you’re right in the scenario you described (i.e. the rent is in arrears and HB should be paid direct under Regulation 95(1)(b)) assuming of course that the tenant is contractually required to pay two months’ rent in advance, and that you hadn’t taken any rent at all (so the arrears at the time of the benefit processing were equal to or exceeding the equivalent of eight weeks’ rent).

The only exception would be if they’ve decided that for some specific reason direct payments would not be in the tenant’s/claimant’s interest.

It’s worth noting as well that councils have discretion in any event when making the first payment, to pay the landlord directly. A lot of benefit decision makers will exercise this discretion in respect of the first payment if it’s for a significant amount (as it often is of course, e.g. if there’s been any delay in processing the claim).

I would say however, that in the scenario you describe, once the first payment of HB is made to you, the tenant/claimant will no longer have arrears equal to or exceeding 8 weeks’ rent. Therefore they could choose to make future payments to the tenant.

This is why it’s important in most cases to set out other reasons why they should exercise their discretion to pay you directly (utilising the rules set out at pages 11 to 13 of my guide).

For example if you are genuinely likely to serve notice and seek possession if payments are not made to you directly, or if the tenant has particular issues making it difficult to manage their finances and ensure their rent is paid.

I would suggest that if you suffer any loss as a result of the council not complying with the mandatory 8 weeks rent arrears rule (i.e. the tenant does not pay their rent, having received the benefit) you consider making a formal complaint. You can adapt the template letter on my website to help you do this (search for ‘making a formal complaint to a council because they have not given a decision following a request for direct landlord payments’).

If you have a lot of tenants claiming HB with the same council a complaint may help alert decision-makers to the mandatory nature of the 8 weeks arrears rule, and discouraging them from doing the same in future.

I hope this helps.

Mark