Tuesday, 23 September 2014

Guidance published after landlords voice concerns regarding loss of income

DWP spells out service charges eligible for benefit

The Department for Work and Pensions has published an ‘exhaustive’ list of service charges eligible for benefit in a bid to end uncertainty for social landlords.

Housing sector figures had raised concerns that fewer service charges might be covered by benefit after the DWP published new regulations.

Draft universal credit regulations published in the summer listed just three categories of eligible charges, whereas current housing benefit regulations only listed ineligible charges.

In the wake of concerns from housing sector figures that this could lead to a reduction in service charge eligibility and therefore income, the DWP redrafted the regulations last month to include four categories of payments.

The DWP then went one step further and on 21 December published guidance specifically aimed at social landlords listing exactly what charges can and cannot be claimed by benefit.

The Chartered Institute of Housing had previously raised concerns that charges for estate management, such as communal garden maintenance, may no longer be covered. However, these charges are listed in the new guidance. Sam Lister, policy and practice officer at the CIH, said: ‘We are pleased the government appears to have listened.’

However, housing benefit consultant Chris Smith warned there is still likely to be some uncertainty.

He cited a DWP survey published in 2010 showing that more than 400 descriptions of service charges are used by landlords. He said there could be legal disputes as social landlords try to ‘shoehorn’ charges into one of the four headings in the guidance.

According to the most recent global accounts for housing associations, service charge income is worth £870 million a year.

Readers' comments (16)

  • Rick Campbell

    The devil will be in the detail -- as always.

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  • Agree with Rick, but on first glance, they appear okay

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  • Alex Brown

    Having just done a quick read through of the guidance it seems fairly reasonable, just one major area for concern,there is no obligation on landlords to tell tenant just how much is eligible for HB, they acknowledge that most give a breakdown of charges but it will be down to the tenant to assess how much to claim. First reading is that most will be fully eligible but where they are not the scope for error and sanction is terrifying.

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  • Melvin Bone

    Now someone has to explain this to the Councils to ensure a level playing field...

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  • Rick Campbell

    Good morning Alex, am up to my eyeballs in stuff at present and the old brain is not functioning well -- can you see where in-house Community Support/ visiting Warden Service is mentioned?

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  • raindrop

    "Like for Like Compared with those from another similar buidling" which we been asking our Landlord a Housing Trust coming up over two years. I spoke and wrote to the MP, Councillors and ask them to do a Risk Assessment but wouldn't

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  • Alex, I am not sure I fully agree with your initial interpretation. The Regulations do not oblige an RP to provide the eligible/ ineligible split but it seems that the guidance makes it fairly clear that this is what is expected. Sections 3.1, 4-6, 20 and 22-25 all work on the assumptions that the RP will be making the split and informing the tenant.

    I am slightly concerned (from an RP perspective) that this might be more onerous than first thought and it will either lead to some services being cut altougher or alternatively tenants will be expected to fund and legitimate but none eligible costs from sources other than HB (just because it is not HB eglibile does not mean it is unrecoverable).

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  • With the UC overall cap - the higher the Service Charge - the less cash a claimant gets elsewhere - or vice versa.

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  • Rick
    The guidance is solely about general needs accommodation and excludes exempt (supported) accomm. Support has not be eligible for rebate via HB since 2003.

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  • Rick Campbell

    Some of our general needs accommodation access the Community Support Service, Lesley, which prompted my question.

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