Welfare Reform: The Biggest Challenges Are Yet To Come

Local authorities and housing associations are reporting that arrears for council tax, spare room subsidy and rents are starting to come under pressure, after a brief period where collection rates had not been as badly hit as had been feared. This is likely to be partly due to recipients exhausting short term financial solutions and facing barriers to downscaling to smaller properties – not least the lack of availability of such properties. There are fears that the move to direct payment under Universal Credit will put further pressure on rent arrears and spare-room subsidy collection, by placing responsibility for paying rent in the hands of the recipient, often for the first time. Transitional funding, in the form of discretionary housing payments (DHP), has softened the impact of reform. The danger is that unless it is used as part of a longer term solution, DHP can only defer the problem, especially as the funding for this in future years is set to be reduced. Read more on The Information Daily website.