Why Aren’t We More Worried About Withdrawal of Benefits?

by Readers Question

13:31 PM, 11th October 2013
About 7 years ago

Why Aren’t We More Worried About Withdrawal of Benefits?

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Why Aren’t We More Worried About Withdrawal of Benefits?

I am interested that I can’t see any response to, or comment about, George Osborne’s announcement last week to withdraw benefits to claimants – first for 1 month, then for 3 months. Am I the only landlord with social tenants?!

There are serious implications.

Here is an extract of a letter I am sending to Right Hon GO, and to Kris Hopkins, the NLA and any one else who will listen. If you have social tenants I’d urge you to do the same.

As a landlord in the private rented sector I house many tenants who are on benefits.
I know from experience that when a tenant’s benefits are withdrawn, all benefits are withdrawn, including housing benefit/local housing allowance.

In my experience this is always without notice to the landlord. The first that they will know is when the tenant does not pay their rent, or if they are on direct payment, when direct payment does not arrive.

However, I am sure that you will appreciate that in the meantime the mortgage and other bills still have to be paid by the landlord.

My concern is this.

Unless an element of the benefits is ring-fenced to pay the equivalent of housing benefit or local housing allowance, landlords such as myself, who house social tenants on benefits, could see rent payments not being made when benefits are withdrawn.

Under the current legal system there is a defined process by which landlords have to operate in order to gain possession of the property. In practice this can take anywhere months and, in exceptional circumstances, up to a year when a tenant does not comply with court orders and a bailiff needs to be appointed.

It is therefore entirely conceivable that if benefits are withdrawn from a claimant that the landlord will be left with a property with a non-paying tenant.

I would also like to point out that even if an element of the benefit were ring fenced to provide for rent, this would have to be paid directly to the landlord, otherwise I have no doubt that many tenants would use the money in lieu of job seekers allowance or whichever benefit has been withdrawn.

I would therefore urge yourself and Mr Hopkins to consider one or more of the following:

• In the event that benefits are withdrawn, either for one month, three months, or even longer, that an element of that benefit is ring fenced and paid direct to the landlord so that the tenant’s rent is covered.
• That legislation be passed to allow landlords to obtain fast track possession of the property where a tenant is has benefits withdrawn.
• That legislation be passed whereby mortgage lenders be required to waive mortgage payments where a tenant has benefits withdrawn and cannot, or will not, pay their rent.

Again I would urge you to consider these, as sadly, from experience, I know, and I am sure that many other landlords who house social tenants will agree, that the ‘punishment’ for not complying with the terms of claiming benefits will not fall upon the claimant, but will fall upon the landlord.

I would also urge the government, and particularly Mr Hopkins, to decide once and for all how you perceive the private rented sector, specifically in terms of housing social tenants through private landlords.

It seems to me that there is a lack of understanding within government as to the pressures and problems that private landlords face in housing tenants on benefits.

In this age of austerity where few council houses are being built, and the responsibility for housing social tenants’ falls mainly upon private landlords, it would be nice to think that the government support our efforts. Sadly, however, that does not seem to be the case as ideas are put forward, and legislation passed, which does little to help and much to hinder.

If it is still the intention of the government that social tenants are housed primarily by the private rented sector then can I humbly suggest that greater consultation is made with those at the sharp end who house social tenants, and that the ideas and legislation put forward encourage private landlords and not discourage.

Regards

Petergeorge osbourne



Comments

Anthony Endsor

23:07 PM, 11th October 2013
About 7 years ago

Just don't take on benefits tenants in the first place. That'll solve the problem for Landlords. Give the Councils the grief instead. Why should Landlords always put up with it?

Dunsaw

23:38 PM, 11th October 2013
About 7 years ago

Reply to the comment left by "Gary Nock" at "11/10/2013 - 15:02":

Gary there are responsible tenants in receipt of benefits.

Some councils have vetted tenants who they support with a bond or rent guarantee scheme. The emphasis should be on responsible tenants who care for your property.

I have been on the other side and it is not fun knowing that you will look after a property but have landlords turn you down.

I was surprised to realise that one of my landlord friend had never had accommodation problems in his life. Wow some people are lucky!

David Sweeney

0:28 AM, 12th October 2013
About 7 years ago

Reply to the comment left by "Jonathan Clarke" at "11/10/2013 - 16:00":

Letting to claimants, or not, is a landlords prerogative. However, we should note that there are a large number of landlords, like Jonathan, who make a conscious decision to focus on this sector, and do very well out of it. So it does not have to be a disaster. I guess the key is to go in with eyes open and ensure you manage your risks - that includes ensuring your knowledge of the benefits regulations and your relationship with the benefits department is up to scratch.

Mick Roberts

9:29 AM, 12th October 2013
About 7 years ago

This Govt han’t got a clue, they don’t realise Welfare there as a safety net for some people.
I’ve just had a letter back from Lord Freud, he’s not answered the question whatsoever about where is the provision for direct payment of LHA/HB to Landlord, in regards to the recent benefit cap come in, to keep roof over their heads & mortgage paid.

They are running with the majority or workers who may change their mind one day, should they ever need welfare. I’ve said before, if Govt voted to scrap Income Tax, I suspect majority of people would vote for that too-‘Cause they don’t see the bigger picture.

I’m a HB Specialist in Nottingham, things have got much worse this year.

Cracking words Jonathon, Gratification Postponement one of my favourite sayings.

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