Why are local authorities Paying Housing Benefit directly to tenants?Make Text Bigger
I have recently written to Wellingborough Council as follows and would be interested in the views of other landlords (in particular those with a detailed understanding of the relevant legislation):
Why are local authorities Paying Housing Benefit directly to tenants?
It has recently come to light that Wellingborough Borough Council has been paying housing benefits directly to my tenant without my knowledge. The tenant has spent the housing benefits money and now owes me in excess of £3000 in rent arrears and court fees. Despite the fact that the tenant has fraudulently squandered the housing benefit that was due to me Wellingborough Borough Council are unwilling to cooperate even in providing me information about the payments that have been made or any new address for the tenant that will enable me to pursue the debt through the courts. This is a wholly unacceptable state of affairs.
The Legal entitlement to housing benefit is for the sole purpose of subsidising rent for a tenant who lacks the means to pay rent. The sole legal beneficiary of the money allocated for this purpose is the tenant’s landlord.
Your staff have stated to me that:
1. The council is not obliged to inform the landlord that housing benefit is being paid to the tenant. The council will however inform the landlord under some circumstances.
2. The tenant is not obliged to pay housing benefit on to the landlord. The council will however pay the housing benefit directly to the landlord if the account is 8 weeks or more in arrears but (implicitly) only then on the basis that the landlord is aware that housing benefits are being paid.
3. The council will not provide details of the tenant’s new address to the landlord under circumstances where the tenant has deliberately failed to inform the landlord of an award of housing benefits and failed to pay the awarded sum to the landlord.
The stated reason for withholding information from the landlord is to avoid breaching the data protection Act. Since the tenant has provided the landlord’s details to the council it follows that the landlord is aware of the tenant’s details and vice versa. By informing the landlord of the housing benefit award the only new information provided to the landlord is the fact of the housing benefit. How can it be a breach of the data protection Act to inform the landlord that he is to be the legal beneficiary of a sum of money via a housing benefit award whether or not the sum is paid directly to the landlord? Conversely it could be considered to be a breach of the data protection Act to hold the details of the landlord without the knowledge or permission of the landlord.
Moreover the council has a duty of care to confirm the validity of the rental agreement supporting the claim which would necessitate contacting the landlord. In any event by paying housing benefit directly to landlords under particular circumstances such as 8 weeks of arrears the council is implicitly acknowledging that the imparting of information about a housing benefit award to the landlord does not constitute a breach of the data protection act.
By deliberately withholding the tenant’s new address from the landlord under circumstances where the tenant is fraudulently concealing and withholding the housing benefits from the landlord the council is complicit in that fraud and the further perpetration of fraud onto the next unsuspecting landlord. The effect of this policy is to force landlords to subsidise housing needs that are the responsibility of the council.
It follows from the above that Wellingborough Council is knowingly exposing the landlord to losses.
Wellingborough council owes a duty of care to both the landlord and the taxpayer to ensure that housing benefit is received by the landlord to whom it is owed.
By definition tenants receiving housing benefit will be short of money which will inevitably result in many tenants electing to illicitly withhold some or all of this money from their landlord.
The implementation of a policy to pay housing benefits directly to tenants is a demonstrably reckless abandonment of the local authority’s duty of care to landlords and the taxpayer. The breach of duty of care is worsened by failing to inform the landlord about the payment of housing benefits.
The effect of this ill conceived, short sighted and borderline lunatic policy is entirely counter productive:
1. Tax payer’s money is illicitly squandered by tenants
2. Landlords are faced with unnecessary financial stress
3. Landlords will refuse to rent to tenants receiving housing benefits reducing the available housing stock further and leading to more cost for the tax payer to house such tenants in Bed and Breakfast accommodation.
What are the intended benefits of this policy (and to whom)?
Please can you urgently review your policy and respond to me with your intended course of action. I have copied this letter to the member of parliament for Wellingborough.
Please now provide with the following information which I trust you will cease to withhold:
1. The date the application for housing benefit was made
2. The date the housing benefit was awarded
3. The date and amounts of all housing benefits paid to date
4. Any/all new address details that you have/will have for the tenant
I hold Wellingborough Council liable for my losses and costs in this matter. Please can you now compensate me for my losses and costs:
Rent arrears £3,295.00
Court fees £ 190.00
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