Universal Credit and private landlords

Universal Credit and private landlords

10:31 AM, 15th December 2017, About 6 years ago 6

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The introduction of Universal Credit has been a hot topic for the various landlord forums over the past few months. Universal Credit is replacing the myriad of benefits currently available and replacing it with one single all-encompassing payment.

This Universal Credit payment will incorporate the current system of payment of various benefits including Housing Benefit, Job Seekers Allowance, Employment Support Allowance and Tax Credits.

The new payment will be made monthly in arrears, the ideology behind this significant change being that it will make transition to work easier for the claimant of the benefit, as it will replicate a salary payment.

How does this affect private Landlords?

In terms of rent and rental allowance, private sector tenants will either receive payment at the Local Housing Allowance rate, which can be found here, or their rent whichever is the lower amount. This will however not be made as a separate payment but incorporated into their Universal Credit Payment.

The Universal credit changes will potentially have the biggest impact on those who currently receive payments directly from the Local Authority, as Universal Credit payments will be made directly to the claimant and they will need to manage their own rental payments.

For tenants who currently manage their own payments upon receipt of Housing Benefit there will be slightly differing challenges.  These challenges will arise from the change of date they receive their payment, and the impact this may have on their individual cash flow.

What can landlords do?

Firstly, landlords should be aware of when the Universal credit will be rolled out in their area. You can check this here:

Postcode check:https://ucpostcode.entitledto….

Secondly, you should engage with your tenants to ensure they understand the importance of paying their rent and that they are aware of the changes. You should also ensure that they have a bank account in which to receive payments and have knowledge of the new benefits system. This can be easier said than done if you are dealing with a vulnerable tenant or a tenant for whom English is not their first language.

What should landlords look out for?

The controversy is mostly from claimants, as there has been a lot of press around waiting times for claimants, and tenants being left in rental arrears with debt building up. This in turn has impacted on private landlords.

Landlords should ensure they stay in regular contact if a tenant is late in paying their rent. The government have put in place a number of safeguards to help tenants manage their finances, a guide to which can be found here. However it is expected that most claimants will manage the transition to the new system seamlessly, which may be somewhat optimistic.

It’s worth bearing in mind that this is a huge overhaul of the current system and will take some time to get used to. There will be teething issues and if you experience major difficulties then it will be worth getting in touch with your National partnership team contact. Details of these can be found here.

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Mick Roberts

10:50 AM, 15th December 2017, About 6 years ago

Bedlam is ensuing.
I have 3 on UC so far, with another 70+ maybe to switch this October. Not looking forward to it.
Especially with the 3 so far a 100% failure rate. This Tory Govt have not got a clue how the lower classes live.

Bill irvine

11:29 AM, 15th December 2017, About 6 years ago

Here's a piece I wrote for RLA members in past couple of weeks https://news.rla.org.uk/bill-irvine-universal-credit-changes-and-timescales-explained/ which provides some updates & important changes, for the better, in relation to Universal Credit. Even with changes, many problems continue to exist, but the RLA and myself are continuing to press DWP and the Independent Case Examiner for further improvements and easements, just like we did between 2008 -2011 in relation to LHA. The pendulum of change is definitely now swinging in the right direction, so expect further improvements going forward.

For those Landlords with a considerable interest in LHA/UC don't delay in getting yourself educated on this new UC benefit, as it bears little resemblance to Housing Benefit (LHA). If you're aware of the areas of difficulty and how to tackle them, you should be able, in longer term, to mitigate some of your potential losses. In addition, whilst the focus is currently on the many flaws in the system, there are also some opportunities in UC for landlords interested in making the effort to become educated and adapt.

Anyone experiencing difficulties with LHA/UC can contact me through my website or e-mail

Mick Roberts

11:58 AM, 15th December 2017, About 6 years ago

Shocking in't in Bill.
I was speaking to someone quite high up in UC on Tues or Wed this week who said he'd been recently talking to u & I cannot believe this as per my log:

Only just recently after working with Bill Irvine, have they changed this, UC was not listening to tenant where they used to ring & ask in arrears, if tenant said No, they’d keep paying tenant. Tenant gonna' keep saying that forever if he gonna' get £500 FREE EVERY MONTH.

Apparently they want to refer one of my case to the Independent Case Examiner where I sent in letter Apr 16 to say my first UC tenant more than 8 weeks arrears.
Dec 17, now I've located these higher up people in UC, they have told me, the rent arrears proof I sent in Apr 16 IS ON THEIR SYSTEM. And no one has acted on it. They just paid the tenant after reading my letter. At that time, & I still am, we were novices with UC, Arrears UC47 form this address, that address non secure email rammel this & that, someone should have rang me & said the correct procedure at the time for getting rent direct was this & that.

And with LHA, & history & it was only 2008 direct payment then. HB's learn't from their mistakes, HB has the experience, just go & ask them. But Oh No, Mr Tory idiot Govt thinks they know best. In the meantime UC is costing itself & us millions. When a quick phone call to top LHA HB staff will tell them about the best way to keep roof over their heads. A 5 year old kid could tell u. Why give it Mummy when she gonna' spend it, why not just pay the Landlord? Simple as that.

Bill irvine

12:41 PM, 15th December 2017, About 6 years ago

Reply to the comment left by Mick Roberts at 15/12/2017 - 11:58

"Shocking" is a fairly good description of how DWP has handled the implementation of UC from almost day one. I penned an article for YPN in August 2011. The title of the piece was "Hitting the DWP Brick Wall".

In the narrative, I refer to similar difficulties I had encountered dealing with the DWP in relation to a Housing Benefit (LHA) issue, for a tenant living in Willsden, London whose DWP office was based in Belfast. It included the content of an e-mail I sent to Ian Duncan- Smith and Lord Freud highlighting my concerns over what can only be described as DWP maladministration, and how the issues I'd highlighted, if not addressed urgently, could scupper the delivery of Universal Credit and cause havoc to Social & PRS landlords and tenants alike. I concluded the article:

"Looking ahead to the Government’s plans in respect of Universal Credit (UC) which is designed to effectively abolish HB/LHA as we know it, and replace it with a "housing element", built into the UC proposed caps, all of which is to be administered by the same DWP, fills me with absolute dread for both tenants and landlords alike. Council administration, even with its faults, is a far better option than a DWP driven service operated from regional call centres by staff that are, by comparison, poorly trained, in receipt of minimum wages, de-motivated, and utilising systems and procedures geared more to impeding and frustrating than actually resolving problems".

If anything, I underestimated just how poor DWP would be. However, as I've been involved in this area of Social Security administration for 30+ years, I've sought out some the very good and helpful staff in the hierarchy of DWP who are sympathetic to landlords complaints. Piece by piece and with much help from the RLA we're now starting to see improvements, including the recent announcements of paying the further two weeks HB at the point of transfer; the abolition of the 7 day wait for "new" claimants; and redirection of UC "housing Costs" to landlords from day one, where their tenant(s) on LHA have their payments already safeguarded.

Still plenty to do to improve things but these recent steps are signs DWP is slowly taking on board landlords' concerns. Long may that continue!

Bill Irvine

Mick Roberts

14:35 PM, 15th December 2017, About 6 years ago

Ha ha yes Bill, I can remember your article Hitting Brick wall.

Yes the kids I deal with on the UC phones are unbelievable. My contact last week, said the managers below him should not be making the mistakes they are making in their letters to me, Part of Log:

Your staff keep saying in the letters ‘I musn’t include other tenants details in my letters’. Why not?

Who says I can’t?
If I’ve currently got TWO tenants queries, who on this planet said I can’t talk to you about two tenants at the SAME TIME? I had that with HB about 20 years ago. Yes sounds ridiculous, doesn’t it. We had to put the phone down & queue back up to discuss another tenant.
I complained, this one went to the Govt Ombudsman. And guess what? Yes, she cited unreasonable behavior & not using common sense.
Now any Landlord can ring/write/email HB & talk about all their tenants problems at same time.
I got this changed 20 years ago with HB.

You have a code, rule, regulation whatever that you MUST RING PEOPLE BACK WITHIN 3 DAYS. Not ONCE have you rang me back!

The latest letter is from XXXXXXXXXX Correspondence manager.
Can you believe his letter COMES WITHOUT A PHONE NUMBER? How are we ever going to solve this?
He has not answered my questions & has asked Mr XXXX to ring. Is he nuts? Ignorant? Stupid? Mr XXXX tenant has asked me to ring. He’s sent you permission letters. Are you ignoring these requests? How many more times have I got to write?

Yes Bill how poor could it be? I couldn't do worse if I tried.

And yes, if we get the common sense people at the top, we'd solve a lot. But kids answering the phone, it's like ringing Indian Call centre who are reading a script & not solving a thing.

You've done great so far Bill. But like u say still plenty to do. Let's hope they sort it soon.

Tobias Nightingale

12:31 PM, 17th December 2017, About 6 years ago

Reply to the comment left by Bill Irvine at 15/12/2017 - 12:41
Hi Bill Regarding the following you said - including the recent announcements of paying the further two weeks HB at the point of transfer; the abolition of the 7 day wait for "new" claimants; and redirection of UC "housing Costs" to landlords from day one, where their tenant(s) on LHA have their payments already safeguarded.'

Unless I am mistaken the change they announced was in fact if the LHA money is currently going direct to the Landlord they will be given the CHOICE for it to CONTINUE to do so, so better than the previous situation but a good deal of tenants will be tempted to make it go direct to them and the resulting situation you can imagine.

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