Universal Credit – Parliamentary Written Answer

Stephen Timms: To ask the Secretary of State for Work and Pensions what estimate he has made of how long it will take when a universal credit claimant reaches the eight-week rent arrears trigger for direct payments to be transferred to managed payments.

Steve Webb: When a claimant reaches the two calendar month rent arrears trigger point, the landlord will be required to provide DWP with evidence of the rent arrears. Our intention will be to implement the managed payment of rent before the next UC payment is issued wherever possible, so that further arrears do not accrue.

Universal Credit – Parliamentary Written Answer

Stephen Timms: To ask the Secretary of State for Work and Pensions whether arrears will be deducted directly from a recipient of Universal Credit with rent arrears which triggers a transfer to managed payments.

Steve Webb: In cases that are converted to managed payment of rent as a result of the rent arrears trigger, arrears will be deducted from the UC award.

Stephen Timms: To ask the Secretary of State for Work and Pensions how his Department will be notified of a universal credit recipient's rent arrears.

Steve Webb: DWP can be notified of a universal credit claimant's rent arrears by the landlord, the claimant themselves or a representative on their behalf. In the UC Pathfinder rent arrears are notified to the UC Service Centre.

Stephen Timms: To ask the Secretary of State for Work and Pensions when a recipient of universal credit accrues eight weeks' rent arrears and is moved to managed payments, how long will it be before they are moved back to direct payments.  

Steve Webb: Under universal credit we will return claimants to direct payment of rent once we are satisfied that they are in a position to manage their affairs. We expect that managed payments will remain in place at least until the outstanding arrears have been recovered. One of the failings of the current system is that decisions to move claimants to managed payments of rent are not systematically reviewed. How long managed payments remain in place beyond that will depend upon individual circumstance but we expect most claimants would not be switched back to direct payments for a further six months.

Stephen Timms: To ask the Secretary of State for Work and Pensions whether he proposes that recipients of universal credit, who already have rent arrears when they claim, will be moved onto direct payment.

Steve Webb: It will depend on the claimant's circumstances. All new claims will be looked at on an individual basis to establish whether the claimant is in a position to manage his or her own affairs. Managed payments of rent will only be considered for those claimants who cannot genuinely manage the standard monthly payment and as a result there is a risk to the household's accommodation.

Direct Payment Demonstration Projects - Latest Findings

The DWP has published its latest report into the Universal Credit demonstration projects testing the payment of housing benefit direct to social housing tenants.  Among comments made by housing providers taking part in the projects were;

"Our experience shows that some of the triggers for arrears are: delays in payment, lifestyle changes, change of household and the impacts of welfare reform.” (Oxford City Council and Green Square)

"Having trialled the 12-week arrears level, we believe that 12 weeks has proved to be too long a timeline to trigger switchback, as it enables the rent arrears debt to escalate to a level which can become unmanageable, and difficult for the customer to recover from, particularly where other debts exist.”

(Shropshire Council, Bromford Group, Sanctuary and the Wrekin Housing Trust)

“The rent collection process demands considerably more effort for a lower rate of return.  Staffing levels are well above those for “business as usual” (Bron Afon Community Housing, Charter Housing and Torfaen County Borough Council)

Download a copy of the report from the DWP website.