Renters on Universal Credit at risk of being underpaid housing costs

TENANTS on Universal Credit are at risk of being underpaid housing benefits after the government abandoned plans to change the way rent changes are reported.

Normally, it is up to the tenants to let the Department for Work and Pensions (DWP) know about any changes to their housing costs, such as annual rent increases, through their online journal.

Landlords are then required to verify the information to make sure tenants receive the right amount of Universal Credit to cover the rent and charges.

But there are worries that tenants forget or don't know they have to do this, leaving them underpaid and potentially in arrears.

For the past 18 months, the DWP has been running a trial that lets landlords verify multiple rent changes with Universal Credit in one go.

It speeds up the process for housing associations and councils, which are faced with the huge administrative task of updating mass changes for each tenant individually.

What to do if you have problems claiming Universal Credit

IF you’re experiencing trouble applying for your Universal Credit, or the payments just don’t cover costs, here are your options:

  • Apply for an advance – Claimants are able to get some cash within five days rather than waiting weeks for their first payment. But it's a loan which means the repayments will be automatically deducted from your future Universal Credit payout.
  • Alternative Payment Arrangements – If you're falling behind on rent, you or your landlord may be able to apply for an APA which will get your payment sent directly to your landlord. You might also be able to change your payments to get them more frequently, or you can split the payments if you're part of a couple.
  • Budgeting Advance – You may be able to get help from the Government for emergency household costs of up to £348 if you're single, £464 if you're part of a couple or £812 if you have children. These are only in cases like your cooker breaking down or for help getting a job. You'll have to repay the advance through your regular Universal Credit payments. You'll still have to repay the loan, even if you stop claiming for Universal Credit.
  • Cut your Council Tax – You might be able to get a discount on your Council Tax by applying for a Council Tax Reduction. Alternatively, you might be entitled to Discretionary Housing Payments to help cover your rent.
  • Foodbanks – If you're really hard up and struggling to buy food and toiletries, you can find your local foodbank who will provide you with help for free. You can find your nearest one on the Trussell Trust website.

But the DWP has said it is scrapping the plans after it found the system "was not suitable to use at scale".

The department is reassuring landlords and tenants that it is looking into a "new approach" to make the system easier to manage but hasn't specified what this is or when it will be made available.

The National Housing Federation has said it was "disappointing" a fix won't be found in time for April, when the majority of rents go up for housing associations and council tenants.

A solution to the issue is already long overdue.

The DWP had initially promised to introduce a new system to speed up the process by April 2019 but it didn't even being testing the process until August that year.

Sue Ramsden, policy leader at the National Housing Federation, which represents housing associations, said that scrapping it will mean residents won't be getting the right amount of benefits to pay the bills.

She added: "Housing associations will continue to work with residents until this comes into effect, so they are aware of the importance of telling DWP once their rent has changed."

A DWP spokesperson told The Sun: "Ahead of 2021 annual rent changes, we have looked again at the end-to-end process and will be writing to landlords to share details of a new approach, which we believe offers significant improvements for both landlords and claimants. 

"Testing with landlords to bulk-upload rent changes via the portal showed that it was not suitable to use at scale with large numbers of landlords and claimants."

A new system that allows rent payments to be paid directly to landlords was launched last year to help millions of tenants who have fallen behind on rent.

Universal Credit families are also at risk of losing their homes due to soaring rents and they now have to pay hundreds to top up housing benefit.

Back in April, the DWP temporarily suspended rent arrears from being deducted from Universal Credit payments to support families through the first coronavirus lockdown.

Unfortunately, it has not rolled out the help again during the third national lockdown.

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