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Social landlords face huge admin burden over Universal Credit issue
Social landlords have warned they face a huge administrative burden next year unless the government implements reforms to the way rent changes for tenants claiming Universal Credit are processed.
Major housing associations have told Inside Housing that they could incur extra costs and see resources diverted from mitigating the impacts of Universal Credit, unless the government makes swift changes to the way rent changes are recorded, and allows them to update information in bulk.
The Department for Work and Pensions (DWP) told housing associations in February that it would enable them to record rent cost changes in bulk on behalf of tenants claiming the new benefit system from April. But Inside Housing understands these changes were never put in place.
Currently, the DWP requires individual claimants to declare when their rent and service charges change in their Universal Credit online journals, with benefit entitlements calculated accordingly.
But there are concerns that many tenants do not know about this requirement and do not register the changes, leading to them being paid the wrong Universal Credit housing costs.
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In England, where social rents were cut by 1% in April, this could mean tenants are being overpaid and will later need to pay back the difference.
Rents increased in Scotland and Wales, meaning tenants could be receiving less than their entitlements.
Landlords have been contacting all of their tenants receiving the housing element of Universal Credit to ensure they recorded any rent change correctly – but have warned this might not be possible next April when the number of claimants increases considerably.
Under the legacy benefit system, councils are responsible for updating rent data.
David MacKenzie, managing director of Cube Housing Association, part of Wheatley Group, said the landlord was able to verify rent changes for 99% of its 4,300 affected tenants in April – but that next year, the figure will be closer to 7,500.
He warned the “big administrative task” would “only get more difficult” as the number of claimants rise.
“We think it’s vital that the rent increase process is automated, as it was previously, to allow us to focus staff time on helping mitigate the impact of Universal Credit on people’s lives,” Mr MacKenzie added.
Sue Ramsden, policy leader at the National Housing Federation (NHF), said: “The delay to this being implemented has created extra work for staff and a degree of confusion over what was happening.”
She added that the NHF has been assured by the DWP that the government still intends to allow the bulk transfer of rent data “after further testing”.
According to official statistics, there were 505,638 social tenants receiving Universal Credit housing entitlement as of February 2019, with around 30,000 new households joining them each month.
Ian Clutton, tenancy sustainment manager at PA Housing, said: “At PA Housing we have over 2,300 households claiming Universal Credit, most of whom would have needed to log changes to their rents and services charges through their Universal Credit journals in April 2019.
“Some households will still not have recorded a rent decrease and will now be being overpaid, and not all households whose service charges have increased will have updated their journals, meaning that they will be being underpaid.”
He said PA Housing is continuing to monitor rent accounts to identify where tenants have not updated their journals.
Bill Irvine, of UC Advice & Advocacy, said: “I believe that the DWP administration has really failed housing associations and councils in this area.
“This is something that councils have been delivering every year for the last 20 years without upset.
“Next year, as the Universal Credit roll-out continues, the numbers are going to get larger and the cases are going to get more complicated unless they can come up with a workable solution.”
A spokesperson for the DWP said: “The bulk upload service is currently being tested and further plans will be announced in due course.
“It remains the claimant’s responsibility to notify all changes of circumstance including housing costs, and the bulk upload service is not intended to replace this.”
