Government to reconsider direct payment of housing benefits
Posted by Gary Winter
Management of list property may be made easier for landlords following the government's decision to reconsider its plans for the direct payment of housing benefits to recipients.
Under the government's proposals for a 'universal credit' system, a number of different benefits would be combined into a single payment that would be paid directly to the individual.
The original plans included housing benefit within this universal credit, meaning it would become the recipient’s responsibility to pass payments on to their social or private landlord, rather than the money going directly to the property owner as is the case now.
This led to concerns that it could increase instances of tenants falling into arrears, while studies also indicated many of those receiving the benefits would be happier to see their landlord receive payments directly.
Now, welfare reform minister Lord Freud has announced that the government is to review the impact of paying housing benefits directly to tenants and is to reconsider giving them the choice to decide whether the money should go to them, or to their housing provider.
The news was welcomed by Alan Ward, chairman of the Residential Landlords Association (RLA).
"Given its commitment to individual responsibility, it seems remarkable that the government has so far denied tenants the ability to decide how their housing benefit is paid.
"The RLA has led a campaign, along with groups representing tenants, social housing providers and mortgage lenders to champion the rights of tenants to choose. We welcome the minister's decision to establish a review of direct payments."
A recent Policis poll of 1,000 social housing tenants carried out on behalf of the National Housing Federation found that nine out of ten prefer the security of knowing that their housing benefit is being paid directly to their landlord.
Meanwhile, according to the National Landlords Association, 35 per cent of private rented sector landlords let properties to recipients of Local Housing Allowance, equal to 420,000 landlords.
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