This website uses cookies for anonymised analytics and for account authentication. See our privacy and cookies policies for more information.





The voice of Scotland’s vibrant voluntary sector

Published by Scottish Council for Voluntary Organisations

TFN is published by the Scottish Council for Voluntary Organisations, Mansfield Traquair Centre, 15 Mansfield Place, Edinburgh, EH3 6BB. The Scottish Council for Voluntary Organisations (SCVO) is a Scottish Charitable Incorporated Organisation. Registration number SC003558.

Councils buckling under Universal Credit arrears

This news post is about 7 years old
 

Survey reports vast majority of English council tenants on Universal Credit are in arrears

Councils in England are buckling under the pressure of Universal Credit after a survey revealed 86% of tenants on the scheme have rent arrears.

Research conducted by the National Federation of Arm’s-Length Management Organisations (NFA) and the Association of Retained Council Housing (ARCH), which represent more than one million council homes in England, carried out annual research into Universal Credit claimants and found the percentage of council home tenants in receipt of Universal Credit who are in rent arrears has increased by seven percentage points – from 79% in March last year to 86%.

In comparison, just 39% of tenants are in arrears who don’t receive Universal Credit.

Researchers said although pre-existing rent arrears is an issue for many people moving onto Universal Credit, “it does not completely explain the higher levels of arrears among UC claimants”.

The research found 50% of the claimants were in arrears before going onto Universal Credit, which rolls several benefits – including housing benefit – into a single monthly payment to claimants, rather than directly to landlords.

Increased use of loan sharks in the affected areas was also reported.

All respondents said the six-week waiting period was either “very frequently or frequently” a contributing factor in tenants falling into arrears.

Ministers in Scotland have announced the impact of Universal Credit was to be mitigated by increasing frequency of the payments and paying landlords rent directly.

Glasgow City Council published a report showing claimants' arrears could potentially impact on jobs and lead to cuts in services.

Hugh Broadbent, chair of the NFA, said: “We believe the current unacceptable waiting times and errors in processing claims are causing significant financial hardship to our tenants and communities.”

We are extremely concerned with the upward trajectory of rent arrears - John Bibby

John Bibby, chief executive of ARCH, said: “We are extremely concerned with the upward trajectory of rent arrears for Universal Credit households. Not only are numbers of households increasing as UC is rolled out, but the percentage of households falling into rent arrears and experiencing financial difficulty is critically high.

“If this trend is not reversed it will have significant impact on local authorities’ rental income streams and the long-term ability for housing departments to provide essential services to their communities.”

A spokesperson for DWP said: “The best way to help people pay their rent is to help them into work, and under Universal Credit, people are moving into work faster and staying in work longer than under the old system.

“As this report makes clear, over three-quarters of their tenants were already behind with their rent before their Universal Credit claim started.

“Our research shows that the majority of UC claimants are comfortable managing their budgets, and that after four months, the proportion of UC claimants we surveyed, who were in arrears at the start of their claim, fell by a third.

 

Comments

0 0
sue
about 7 years ago
uc are are not paying the way jsa did ie; every 28 days. therefor there are two to three days a month not being payed which when added up leaves a shortfall in paying the rent....
0 0
Adam
about 7 years ago
At Wakefield and District Housing rent arrears increased from 2% to 11%, Bron Afon community housing in South Wales reported a 50% increase in arrears, while in Edinburgh, Oxford and Southwark there is around a 30% increases in arrears. Southwark for example are predicting that arrears will increase by £14m. where UC was rolled out first https://universal-credit-helpline.co.uk/2017/02/21/welfare-benefits-reform-universal-credit/
0 0
Darroch
almost 7 years ago
Apparently 40% of the UK population are living hand-to-mouth lives and have less than £100 of savings in their bank accounts; many people in this boat are also paid on a weekly, or even ad hoc, basis and do NOT receive monthly salaries in the way the DWP claims.These people will inevitably end up in rent arrears and/or debt because of the six week (or longer) hiatus between applying for Universal Credit and receiving their entitlement. The DWP often speaks about "advances" to the neediest UC applicants which are not actually earlier payment of Universal Credit to the most desperate, but a "loan" from the DWP which has to be paid back later, quite possibly from already inadequate frozen benefits, putting them in debt to the actual DWP itself, which seems perverse.Universal Credit affects the poorest and most vulnerable applicants worst, i.e., it drives the poor and the vulnerable into debt, rent arrears and potential homelessness by design which any sane person would have to consider cruel, negligent and irresponsible. Plus, besides the growing multitude of cases of personal misery and suffering there are cancerous spin offs such as landlords refusing to rent accommodation to Universal Credit recipients, fearful of not being able to secure payment from such individuals reliably because of UC's preposterous and hideously faulty design.How long this can go on for and the DWP remain in denial is anybody's guess. Hopefully somebody will be answerable for creating such pain and misery at some point in the future. Those responsible should not scuttle away and escape scot-free like thieves and murderers in the night.
0 0
Brian
almost 5 years ago
Universal credit it terrible system I was put on the sick from work and to go on UC late last week I received a letter from the council saying I owed them money so visted them at beginning of the week they stated that they started paying the rents into peoples account I said I received no such payment this to me sounds like there going backward as this used to be done many years ago but because tenants were spending the money instead of paying it to the council they stopped and paid the council direct now it seems history is repeating it's self. This system universal credit has been out for several years and still not working I noted before I log in it says beta version so this means its new protatype
Commenting is now closed on this post