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Conservative thinktank criticises Universal Credit housing payment system
A conservative thinktank has criticised the direct payment to tenants of the housing element of Universal Credit and said measures in place to prevent rent arrears are only “reactionary”.
Bright Blue, which describes itself as an “independent thinktank for liberal conservatism”, concluded in a report published yesterday that Universal Credit’s “most contentious unique design features” are housing payments being made directly to individuals and awards being paid monthly in arrears.
The report was based on 40 in-depth interviews with Universal Credit users and found that “a clear majority”, including those not struggling to pay their rent, felt the housing element should be paid directly to landlords.
“There was a strong belief that, in this respect, the legacy system is better,” the report said.
Tenants were particularly concerned about the temptation to dip into rent money to pay for unexpected expenses.
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Under the old benefits system that Universal Credit replaces, Housing Benefit is paid directly to landlords.
Tenants and landlords can apply for alternative payment arrangements (APAs), in which the tenant’s Universal Credit housing element is paid directly to the landlords. However, Bright Blue said “awareness of APAs is low and take-up even lower”.
Department for Work and Pensions (DWP) guidance also states that rent should only be paid directly to the landlords of vulnerable claimants or tenants who are two months in arrears. Bright Blue argued the measures “are clearly reactionary and target only a small and specific group of claimants”.
The report called for Universal Credit recipients to have the power to change online how often they receive their payments and where different elements are delivered.
It also recommended that all new claimants should receive a one-off, upfront payment to help in the initial waiting period and that compensation be paid to those whose awards are late.
“Universal Credit has plenty of potential. A majority of claimants are coping with and adapting to Universal Credit,” said Ryan Shorthouse, director at Bright Blue and co-author of the report.
“However, as it has gone from idea to implementation, the initial widespread support Universal Credit enjoyed has dissipated.
“Despite welcome improvements made by the government in recent years, there are too many examples and too much evidence of significant hardship experienced by a sizeable minority of those on Universal Credit.”
A spokesperson for the DWP said: “We welcome the report’s finding that the majority of people have had a smooth move onto Universal Credit. And where challenges remain, we will continue to make improvements.
“We have recently updated guidance around direct payments to landlords and further improvements are planned to make them easier, faster and more secure.”
Update: at 17.19pm 12/03/19 a statement from the DWP was added to the story.
