Let tenants choose over housing allowance payments, says NLA
Owners of UKproperty investment portfolios in the private rented sector want tenants to be given the chance to choose whether or not they receive housing benefits themselves or whether they go straight to landlords, it has been claimed.
It comes after the government confirmed that proposals to allow housing benefit to be paid directly to the tenant would be put into practice.
However, under the new system, housing benefits would revert to being paid to the housing provider should a tenant begin to fall into arrears.
According to Lord Freud, who developed the new system, steps will be taken to "build safeguards into the system to minimise the impact on social landlords' incomes and reassure lenders".
But according to the National Landlords Association (NLA), this fails to take into account the role that private rented landlords play in providing properties for those who receive housing benefits.
"We call upon the government to remember that private landlords are vulnerable to the effects of rent arrears," said NLA chairman David Salusbury.
"Thirty-five per cent of landlords let properties to recipients of Local Housing Allowance, representing an estimated 420,000 landlords, so it is important that they are considered within this proposal."
He argued that tenants should be allowed to choose how they receive their housing allowance, pointing out that research shows that nine out of ten social housing tenants would like the security of knowing their housing benefit is paid directly to their landlord.
"It is vital that private landlords receive direct payments in order to encourage the adequate supply of affordable accommodation," said Mr Salusbury.
The government's plans form part of the new universal credit system, which aims to combine various payments, including housing benefit and employment support, into one sum paid directly to recipients and therefore simplify the way benefits are calculated and delivered.
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