New universal credit rules could see landlords or tenants incur extra costs
Fewer service charges to be covered by benefits
Proposed new rules could lead to fewer service charges being covered by housing benefit, sector experts have warned.
Draft regulations for the universal credit, expected to come before parliament in the autumn following a consultation, redefine which service charges are eligible to be covered by housing benefit.
Currently regulations list 10 types of service charge which are not eligible. The new regulations turns this on its head and instead lists just three types of charges which are eligible.
As a result of the change, lawyers and housing consultants warn that a host of service charges could no longer be covered by benefit. This would mean extra cost to tenants or landlords, or a reduction in services for tenants.
Housing association Riverside has received informal legal advice stating that 13 different types of charges would become ineligible under the new rules. These include charges for the maintenance of communal gardens, fire safety equipment, communal heating and lighting, lifts, door entry systems, children’s play areas, white goods, furniture and rubbish collection.
The National Housing Federation said it had been in discussions with the Department for Work and Pensions about the change and is due to meet officials on Tuesday.
John Bryant, policy leader at the NHF, said: ‘We have some very real concerns about the draft that has been published and whether it is going to deliver [the government’s] stated aims of not changing the balance between eligible and ineligible service charges.’
Chris Smith, a housing benefit consultant, said he was concerned about the wording of the new regulations. ‘It is clear that [the draft regulations] are intended to drastically reduce the number of services that will be included in benefit for housing costs.’
A spokesperson for DWP said more detail will be outlined in future guidance but the department did not intend to change current principles on service charges.
Universal credit will replace a host of benefits, including housing benefit, with a single payment from October 2013.
- services that are necessary to maintain the ‘fabric of the accommodation’
- the cleaning of communal areas
- and the cleaning of windows that tenants are unable to clean