Campaigns Welfare Reform and Homelessness

Work and Pensions Select Committee demands answers on Universal Credit rollout

Natalie Williamson of the RLA at the Work and pensions select committee
Natalie Williamson
Written by Natalie Williamson

RLA senior policy officer Natalie Williamson gave evidence to the Work and Pensions Select Committee this month – examining the troubled roll out of Universal Credit. Here she talks us through the session – and shares the RLA’s proposals, which would improve the system for landlords and tenants alike.

The RLA has given oral evidence to the Work and Pensions Select Committee on the proposed acceleration of the Universal Credit Full Service Roll out scheduled for October 2017.

Having already submitted written evidence to the previous Committee in the last parliament we were asked to present any updates to the newly formed Work and Pensions Select Committee, with Rt Hon Frank Field MP re-elected as Committee Chair.

We are pleased to see that the Work and Pensions Committee have resumed their inquiry on Universal Credit and we were keen to take the opportunity to share some of the experiences of RLA members and private landlords and the UC system.

Members of the committee, especially Rt Hon Frank Field MP, were very keen to hear about how PRS landlords were finding the transition to Universal Credit  – with his constituency in Birkenhead seeing almost 20% of homes coming from the private rented sector.

On the first panel were representatives from Southwark Council, Councillor Jane Corbett, Assistant Mayor of Liverpool, Your Homes Newcastle and Plymouth Community Homes.

These panellists explained to the committee the problems that they were experiencing with the rollout so far.

Southwark Council were one of the first councils to operate under the ‘full service’ and were able to share their insight after switching across to a fully digital service.

They clearly expressed their concern around the increase in rent arrears since switching across to the full service currently at £1.3 million extra in rent arrears.

This is despite Southwark Council being named as a ‘Trusted Partner’ where information can be shared to help identify those tenants that would benefit from direct payment of their housing costs to the landlord.

They also have access to the ‘Landlord Portal’ which although Southwark feels can be improved  – they did agree it has made certain elements of the UC process easier.

All representatives on this panel were in agreement that the waiting times and delays in payments were causing not only an increase in rent arrears but also hardship and stress for their tenants.

Plymouth Community Homes, currently running under the ‘live’ service area where just single claimants are eligible for Universal Credit noted that that they have seen an increase in choosing to borrow from family/friends rather than taking up the option of an advance payment.

Debt was a key issue for both sets of panels with many claimants having to borrow money whilst they wait between six – seven weeks (if lucky in some cases) for their first payment.

It was later evident as the session went on that the demand for food banks was also on the rise and Wirral Food Bank explained how the roll out of UC had seen a big impact on demand for their services in the second session.

Your Newcastle Homes (YNH) highlighted a concern shared by the RLA in our original written evidence that that local Jobcentre staff did not have enough knowledge of housing or the ability to identify vulnerabilities where someone might struggle with income and to secure their payment of rent.

However, YNH has been able to use ‘co location’ in the ‘live’ service areas by placing staff in local job centres and have formed good working relationships with DWP staff which has seen positive outcomes for them.

They said it is all around the “universal support delivered locally” model, an investment that they have had to make to try to protect rental income.

This is a key point that we later emphasised  – that the local delivery of benefits is key to a good relationship between landlord, local authority and tenant. This isn’t the case with Universal Credit as it is administered nationally.

All panellists sat in the first session agreed that there are challenges to all housing providers with Universal Credit however, private landlords are at a distinct disadvantage when it comes to access to information to prevent arrears from escalating and are now starting to find the market unworkable.

Councillor Jane Corbett, Assistant Mayor of Liverpool told the Committee that in Liverpool they have a Welfare Reform Group led by Private Landlords where representatives from the council’s benefit maximisation team and Registered Social Landlords sit to try to share information and work together.

This is their own initiative as they simply do not have the information to know who is claiming UC and who is not and so a plea for more effective data from DWP was made.

Plymouth Homes also said that a meeting had been set up with private landlords and the DWP in their area, because a number of private landlords have already said that they will not take Universal Credit claimants, stating that there ‘is the fear factor over having to wait for payments and other issues’.

In this session it was clear to see that Rt Hon Frank Field MP was starting to realise that if social landlords were suffering such a big increase in rent arrears amongst other problems, with the trusted partner status, Landlord Portal and other support services in place – how were private landlords coping who don’t have access to any of these things?

For the second session, the RLA sat alongside two representatives from the Citizen’s Advice Bureau, Wirral Food Bank and the Scottish Federation of Housing Associations. This session focussed on delays in payments, increase in the reliance on food banks, the Scottish Flexibilities and how DWP can make the system work better for private landlords.

Here all panellists agreed to recommend halting the roll out of Universal Credit until more work is done to iron out the glitches and snags that stakeholders across all sectors are facing.

Key to this is looking at the delays in payments to claimants, including the seven-day ‘waiting days’ plus the average six-seven weeks that it takes for payments to reach tenants which almost immediately puts them at eight weeks arrears and at risk of eviction.

Citizens Advice Bureau said that they are ‘ringing the alarm bell, because we are seriously concerned that there are still deep flaws in the system that have not been resolved. At Citizens Advice we see a third of people waiting over six weeks, with 10% waiting over 10 weeks.’

Addressing the panel CAB told the committee that the six weeks wait is by design; it is not a delay, it is part of the way Universal Credit works.’

Wirral Food bank expressed its worry that Wirral is still part of a pilot but goes fully digital on 15 November. Their main concern is the proximity of the changeover to Christmas, with the six to seven-week minimum delay and the impact that that will have on the food bank in terms of the resources especially over that lead-up to Christmas.

This is where Rt Hon Frank Field mentioned his call for the ‘Christmas truce’ on Universal Credit  – this is essentially pausing the rollout in the short term. You can find out more about this here.

We told the committee that arrears are also continuing to escalate with direct payments not being processed quickly enough.

The RLA also stressed the playing field between PRS landlords and social landlords needs to be fairer.

We said there needs to be better access to information around tenants’ claims and better support when applying for direct payments needed for PRS landlords, as Data Protection issues often block sensible enquiries PRS landlords may have, with their tenants’ welfare ultimately at stake.

This could include developing a portal for private landlords, similar to that available to the social housing sector.

The association also suggested developing a trusted status model for the PRS, so that private landlords can also see which tenants may benefit from direct payments.

We emphasised that the current LHA system works well because of the local administration of one housing benefit, not six benefits rolled into one, and good working relations between landlords and councils.

There are also inherent rights for landlords for redress and information with the current system – where UC is a discretionary system.

The committee was told warning signs are already there with a 10 percentage point increase in rent arrears in just a year from 27% in 2016 to 38% in 2017 since housing costs were paid directly to the tenant under Universal Credit –  and warned that ultimately PRS landlords will no longer rent to tenants on benefits if the system isn’t improved urgently.

We agreed with CAB that awareness around Advance Payments for those claimants struggling with delays in payments was low and certainly up take of this was low in the PRS.

The panel was keen to ask us about the Scottish flexibilities planned from October 2017,  that will see more regular payments (every two weeks)  and direct payment to the landlord of rent if the tenant wishes in Scotland.

The RLA is supportive of direct payment to the tenant and put this forward to the committee as a responsible decision for the tenant to make if they don’t feel that they can effectively manage money to pay their rent.

The Scottish Federation of Housing Associations however warned that the system is not yet ready for full service roll out  – let alone added flexibilities in Scotland.

Overall the Committee welcomed the perspective of our members and we are very encouraged to see that Rt Hon Frank Field has already written to Secretary of State for Work and Pensions after the evidence session with a number of key concerns saying ‘We were concerned to hear about a lack of support from DWP for private sector landlords who have UC claimants as tenants-a substantial change from the locally administered Housing Benefit system’

You can read the letter in full here.

The Rt Hon Frank Field has also written to David Gauke MP with a number of additional questions on delays, advance payments and the helpline that you can read here.

The committee has now re opened the Inquiry for updates and is seeking written submissions on the following areas – waits for payments, advance payments, impact on and communication with local authorities and landlords, Alternative Payment Arrangements, the effects of planned Jobcentre closures and the proposed flexible arrangements in Scotland.

We would encourage as many members as possible to respond to this call for evidence as it is clear that the Work and Pensions Committee is taking our concerns in the PRS very seriously .

The deadline is 13th October. You can submit your response here.

You can read the RLAs original submission to the inquiry here and our updated evidence submission here.

We would also advise any members that do have tenants currently receiving benefits to help with their rent cost to be prepared for Universal Credit as this is a large-scale change, not only to the way that payments are paid to the tenant, but the systems and procedures that landlords will have to get used to.

We run a course of Universal Credit that you might find useful. You can find out more including dates and costs here.

You can also always contact the Landlord Advice Team and the Policy Team who will also be happy to advise and support you.

About the author

Natalie Williamson

Natalie Williamson

Natalie Williamson is the Senior Policy Officer for the RLA and has worked for the Association since 2013. With almost ten years experience in Housing policy and research since graduating from the University of Manchester in Philosophy and Politics , Natalie leads on the RLAs Health and Safety , Welfare and Fuel Poverty Policy areas.

Prior to working for the RLA Natalie worked for a DCLG appointed National Body for Home Improvement Agencies and worked with multiple Government Departments on policies to enable older people and those living with disabilities to remain independent in their own home. Whilst working here Natalie wrote and had published a good practice guide ‘Supporting People in Private Rented Sector Housing’.

Since taking up her position at the RLA Natalie has worked hard to change the narrative of private landlords by working on research projects on welfare and homelessness and also delivered the RLA Safe and Secure Home to help Landlords achieve safe housing for their tenants.

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