The Department for Work and Pensions (DWP) has announced a change to its previous stance of how much money will be diverted from a tenant receiving Universal Credit who falls into arrears with their landlord.
Until the announcement, the department said that only 5% of a tenant’s Universal Credit could be diverted directly to a landlord to help pay off arrears.
Now they say that up to 20% of the Universal Credit can be used to help pay off rental arrears and this would be paid directly to the recipient’s landlord.
Universal Credit is the new monthly payment that replaces six previous benefits and tax credits but it will see housing benefit being paid directly to tenants instead of their landlords.
‘Financial responsibility’ under new Universal Credit rules
The government claims this will encourage 'financial responsibility' for those who rent their homes.
The DWP now says that it recognises that some tenants will fall into arrears and after several housing organisations criticised the original plan, the Department says it will introduce 'managed payments'.
This will see a claimant being offered extra support and the housing benefit element of the Universal Credit payment being given directly to a landlord.
In a statement, the DWP said that the increase of up to 20% of the claimant's Universal Credit standard allowance being paid to a landlord will help ensure that the tenant gets back on track with their payments more quickly.
The minimum amount that will be deducted from Universal Credit is 10%.
Direct payments to landlords under Universal Credit
The new rules will come into play when a tenant has racked-up two months of rent arrears and the DWP will pay the housing benefit direct to the landlord. They will also, if requested, take the steps necessary to recover any rent arrears through deductions from the remainder of the Universal Credit payment.
Lord Freud, the Minister for Welfare Reform, said: “I would encourage landlords to identify tenants who need support and put those tenants who are ready onto a direct payment.”
The DWP has also produced a pack to help landlords understand the changes to Universal Credit and its impact on rented housing.
33% of tenants claim to pay for repairs
Meanwhile, one in three tenants claim to have fixed something in their rental property rather than asking their landlord to carry out the work, according to a survey by AA Home Membership.
The organisation says that tenants are paying on average £63.20 for jobs while one in six tenants claim to pay more than £100.
The work that tenants have been paying for includes fixing faulty showers and blocked drains as well as faulty wiring and broken locks.
One in 14 claim to have paid for a boiler repair while one in seven said they had to pay for having a damaged carpet replaced.
Many of those tenants questioned claimed it was quicker and easier to do the work themselves rather than involving their landlord.
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