The changeover to the new combined benefit, Universal Credit (UC)which can include an element for housing costs is continuing. Meaning more people are receiving help towards their rent through UC, rather than the old Housing Benefit.
The Department for Work and Pensions (DWP) who are responsible for UC have been looking again at landlord concerns around tenants not using the money meant for housing costs, to pay their rent. How do landlords report that there is a problem? Can they get the rent money safely paid to themselves and can anything be done to clear arrears that have already built up?
These issues have always been recognised by UC rules. There is the facility for landlords to request that future payments are made to the landlord, if the tenant goes into rent arrears. Further, as a separate issue, landlords can also request that deductions are made from the other elements of the tenant’s UC to pay off any arrears that have already built up. Not something you could do under the old Housing Benefit rules, so this represents a real plus for landlords.
But following feedback and real experience about how these rules are working in practice, the DWP have been adding some improvements to the process for reporting problems. In particular, the form used for this has been redesigned. It allows for more information to be provided and includes space for free text, allowing for extra detail about anything that might be relevant. Previously, you could only return the form to the DWP by secure email, but you can now do this through an ordinary non-secure email account or by post. The DWP have also issued guidance on the types of claimants that they consider to be particularly vulnerable and where that vulnerability will be a factor in making decisions to pay the landlord direct. The full information from the DWP is either in (or hyper-linked to, from) the document below:
Revised UC47 rent arrears APA request form and process improvements vfin….
If you are a landlord with tenants either claiming or likely to claim UC, I would strongly recommend that you download or save a link to this.
We’ll be posting more information on landlords, housing costs and UC as and when it becomes available, so please watch this space.
A quick post on Universal Credit and Discretionary Housing Payments, (DHP). DHPs are special payments that can made to people who have a shortfall between the amount of rent they are charged and the amount of help they receive towards it through either Housing Benefit (HB) or the Housing Cost Element of Universal Credit. Colleagues at the Department of Work and Pensions (DWP) have asked we make sure landlords are aware of the following:
‘The Department has received a number of enquiries recently over the use of Discretionary Housing Payments (DHP) and direct payment (Managed Payment) of rent to landlords, to support claimants with housing costs on Universal Credit. DWP confirmed in its 3rd February Housing Bulletin that Universal Credit claimants who have a Managed Payments to their Landlord in place are able to receive Discretionary Housing Payments.’
In other words – if a landlord has made a successful request to the DWP for the Housing Cost Element of Universal Credit to be paid direct to themselves, the tenant can still also apply to the council for a DHP if needed. Please don’t forget though that DHPs can only be awarded when justified by the individual applicant’s circumstances. It should not be assumed that an application will be successful and DHPs are intended to provide temporary support rather than long-term solutions. For more information about DHPs or to make an application, please see our web pages.
And I will just add a reminder of my own. We’re seeing some cases where landlords are contacting the Housing Benefit team to chase up applications for tenants that they presume have applied for HB when actually, the tenant has applied for Universal Credit (including the Housing Element) and is no longer entitled to HB. Do please remember that tenants making new claims, particularly if they are single may well be going on to UC, not HB. However, if the tenant is responsible to pay their own Council Tax, they should still make an application (on our online form) to the council for help through Local Council Tax Reduction.
The number of tenants who receive the new Universal Credit benefit and therefore not entitled to Housing Benefit (HB) is steadily increasing. If you are a landlord or your work involves giving advice / support to tenants who might receive UC, you need to be aware of the following:
- UC is being introduced in stages and initially in Sandwell, only people under 25 were likely to go onto UC. This no longer applies and potentially anyone under retirement age who doesn’t have dependent children, can now go onto UC.
- We have been getting queries from landlords chasing rent for tenants they think are on HB, who actually receive UC. So the tenant is no longer our customer and we’re not the relevant people to talk to. Before contacting us – check with the tenant which benefit they are claiming. If it’s UC, we can’t help. (Although there is an exception to this for some specialist supported housing). Don’t forget though, UC claimants should still apply to us if they want help with Council Tax Reduction.
- We have seen a number of UC claims where the housing cost element (which replaces Housing Benefit) has been awarded from a later date than the other elements of UC. In other words – UC has been paid, but without the rent money, which doesn’t get backdated. We don’t know why this is and I have to stress this is speculation only, but possible causes are: Tenants are failing to provide proof of rent, such as a tenancy agreement when asked. Or they are simply not giving the DWP the right information when making their claims and clearly identifying that they have a rent liability. It’s essential that anyone claiming UC makes sure the DWP get the right information and supporting evidence at the right time.
- We often see cases where we have paid HB for a period that’s later covered by UC. As you can’t receive both benefits at the same time – the HB is treated as an overpayment which the DWP recover by making a deduction from UC. If housing costs aren’t awarded from the start of the UC claim, (as above) – this can have a significant impact on the amount of UC paid at the start of the claim.
You can find more general information about UC on the main government website gov.uk and of course, we will continue to update you about local changes.
You probably already know that when it gets here, the new Universal Credit (UC) benefit will mean the end of Housing Benefit (HB) in its current form. Instead of HB, claimants will be able to claim a ‘Housing Costs’ element in their UC, so that rent money goes to the tenant who will be responsible for keeping up to date with their own rent. This is irrespective of whether it’s a privately rented, council or Housing Association home.
The Department of Work and Pensions (DWP) accept that some tenants will have difficulty managing money or will simply not pay their rent. When this happens, landlords can apply to have the housing element paid directly and there is an online form to request this on gov.uk.
Its worth having a look at this to give you an idea of the sort of information the DWP will expect you to provide. One major feature is that it looks as if you will also be able to use it to not just request that future payments of housing costs come direct to you, but also to ask for pre-existing arrears to be recovered by deductions made from the rest of the tenant’s benefit. I must stress that at this stage we will still don’t have any detail about how this will work in practice, or what criteria the DWP might look at before considering this option. All I can say for now is ‘watch this space.’ We will try and keep you updated, as and when we can. If you get the chance though, do have a look at the UC pages on gov.uk. Apart from the arrears form, you will find a useful document called ‘Universal Credit and Rented Housing: Frequently Asked Questions.‘
I can’t promise that this will be an exciting read, but it does link to other useful documents and this is an issue that any landlord who has, or who may in the future have, tenants on benefits, really does need to keep up to speed with.