Posted by: Carl Brown17/08/2012
‘They won’t be able to handle all that cash, they are not used to budgeting’, it is a refrain uttered by many a housing professional ever since the government first announced that its new universal credit payment would be paid monthly direct to tenants.
Concerns have grown that landlords’ arrears will mount as tenants, used to not having to think about their rent payments, find budgeting difficult. These worries persuaded welfare minister Lord David Freud to commission pilot projects to determine the circumstances under which a direct payment is appropriate.
As Inside Housing reports this week we are now beginning to get an early picture from the pilots as landlords begin to take their first payments from tenants.
It is far, far too early to make any firm conclusions, but the early signs are good.
Staff at Family Mosaic were surprised that the vast majority of tenants already have bank accounts, meaning one hurdle to making direct payment work has already been cleared, while Wakefield and District Housing said only a ‘small’ number of their first batch of payments were not made on time.
A total of 14 landlords are involved in the project and most have been scared off talking publicly about the first direct payments by the Department for Work and Pensions, which is anxious to control how any findings from the project are presented. Many landlords have yet to obtain or assess the results from the initial payments while others are wary of jumping to early conclusions, particularly as some of them are beginning with the tenants who need the least support in paying their rent.
So there are many reasons to be cautious about the findings that are emerging. However the majority of tenants, so far, appear to be paying their rent on time.
Perhaps this shows, as Lord Freud said a few weeks ago, that landlords do not know as much about their tenants as they thought they did.
And perhaps it also shows that landlords need to have more faith in their tenants and their ability to manage their finances.
From Housing matters
Carl Brown looks at regulation, training, board members, pay and a host of other issues that impact the day to day running of social landlords