Bailiffs Called In To At Least 280,000 Homes Over Council Tax Debt

Local authorities in England referred at least 280,000 households to bailiffs over council tax debt in the first year of the pandemic, and asked for more than 115,000 people to have their benefits deducted to clear their arrears. Councils adopted widely differing approaches to council tax arrears as the economy froze and unemployment rose during 2020-21, with some councils suspending all debt-recovery action while others continued to pursue thousands of households. Councils passed 281,380 households to bailiffs in 2020-21 – with at least 93,031 of cases relating to council tax arrears that built up during the course of that year, rather than previous years. Read more on the Observer website.

https://www.theguardian.com/money/2021/aug/08/bailiffs-called-in-to-at-least-280000-homes-over-council-tax-debt

Covid Arrears Leaving Thousands Of Renters Unable To Move Home

Thousands of private renters who have built arrears during the pandemic are struggling to find a new home because of damage to their credit scores, according to a new survey. The research, from the National Residential Landlords Association (NRLA), found that approximately 210,000 tenants may face severe difficulties in getting landlords to let to them in future. Ahead of emergency restrictions easing in the private rented sector on 1st June, results from the survey show that 7% of renters have built arrears since lockdown began in March 2020. Read more on the Property Reporter website.

https://www.propertyreporter.co.uk/finance/covid-arrears-leaving-thousands-of-renters-unable-to-move-home.html

Eviction Orders Being Issued Despite UK Government Covid Pledge

Eviction orders are being issued to tenants who have run up rent arrears because of the pandemic despite a promise by the housing secretary, Robert Jenrick, that “no renter who has lost income due to coronavirus will be forced out of their home”. The government quietly changed its eviction ban last month to allow landlords to throw out tenants who had fallen into arrears as a result of Covid. Until January, landlords could not evict tenants because of rent arrears amassed since the first March lockdown. They could only act if nine months’ arrears had built up prior to the pandemic. Read more on the Guardian website.

https://www.theguardian.com/society/2021/feb/28/eviction-orders-being-issued-despite-uk-government-covid-pledge

Social Housing Rent Arrears Up £100m Since Coronavirus Outbreak

New data from HouseMark estimates that the level of unpaid rent is £100m higher than it would be at this stage when compared against previous years, with this being attributed to the coronavirus crisis. The report illustrates how the pandemic has affected social landlords’ finances and operations, it shows that in April alone median arrears increased by 10%. This means that on average landlords missed out on 3.29% of their total rental income for that month. The figures are based on a survey of 131 social landlords managing nearly 1.4 million homes, with arrears losses projected across the whole sector. Read more on Inside Housing.

https://www.insidehousing.co.uk/news/social-housing-rent-arrears-up-100m-since-coronavirus-outbreak-66581?utm_source=Housing60&utm_medium=email&utm_content=article_link&utm_campaign=H60

Help to Buy Scheme – Parliamentary Written Answer

John Healey: To ask the Secretary of State for Housing, Communities and Local Government, how many and what proportion of Help to Buy, Equity Loan customers are in arrears.

Esther McVey: At end November 2019 1,983 Help to Buy customers or 5.8 per cent of the total due to be paying interest fees, were in arrears. The large majority of customers in arrears are only one or two payments behind and this debt very largely reflects short-term administrative issues with direct debit set-up at the start of the interest fee paying period. Total interest fee arrears of £189,000 at end of November 2019 represent 2.7 per cent of total amounts charged to customer accounts.

http://www.parliament.uk/business/publications/written-questions-answers-statements/written-question/Commons/2020-02-03/11448

Help to Buy Scheme – Parliamentary Written Answer

John Healey: To ask the Secretary of State for Housing, Communities and Local Government, how many and what proportion of Help to Buy, Equity Loan customers are in arrears.

Esther McVey: At end November 2019 1,983 Help to Buy customers or 5.8 per cent of the total due to be paying interest fees, were in arrears. The large majority of customers in arrears are only one or two payments behind and this debt very largely reflects short-term administrative issues with direct debit set-up at the start of the interest fee paying period. Total interest fee arrears of £189,000 at end of November 2019 represent 2.7 per cent of total amounts charged to customer accounts.

http://www.parliament.uk/business/publications/written-questions-answers-statements/written-question/Commons/2020-02-03/11448

Council Tax Debts In England Soar 40% In Six Years

Council tax debts in England have soared by nearly 40% in six years, Guardian research has found, with charities warning these arrears now rival credit card debts as their biggest concern. Amid warnings that “heavy-handed” collection tactics are putting severe pressure on those already in financial difficulty, households face a fourth consecutive year of above-inflation council tax rises as local authorities attempt to recoup money cut from their budgets by central government. The annual band D bill will rise by an average of £75.60. Read more on the Guardian website.

https://www.theguardian.com/money/2019/apr/12/council-tax-debts-soar-in-six-years-charities-warning-arrears

DWP Just Quietly Revealed The Staggering Scale Of Misery Caused By Universal Credit

The DWP has revealed the extent to which Universal Credit is throwing claimants into arrears, debt, and poverty in the results of a claimant survey on its flagship benefit. The survey was carried out between March and September 2017, in two waves. The first wave was with 1,014 claimants, three to four months into their claims. The second was with 1,004 claimants, five months later. Overall in both waves only 25% of claimants said they were “keeping up with bills and credit commitments without any difficulties”. 72% either struggled from “time to time” or constantly, fell behind or were having “real financial difficulties”. Read more on the Canary website.

https://www.thecanary.co/uk/analysis/2018/06/09/the-dwp-just-quietly-revealed-the-staggering-scale-of-misery-caused-by-universal-credit/

Universal Credit Goes Back To Its Future

Universal Credit is going back to its future – making what used to happen under Housing Benefit (HB) happen again. The DWP has scrapped the tenant consent clause so landlords who can prove arrears of two months or more can claim direct payments –  as used to happen under HB.  The DWP has confirmed to the RLA that landlords will no longer need tenants’ consent when applying for Alternative Payment Arrangements (APAs) – which allow the housing element of Universal Credit to be paid directly to the landlord. Until now a landlord would need the ‘explicit consent’ of the tenant to do this.  Read more on the RLA website.

Universal Credit Changes Welcomed, But More Is Needed To Restore Confidence

Changes to Universal Credit have made landlords more willing to rent homes to claimants but the Government needs to do more to address their concerns. Research has found that 36 per cent of private landlords have more confidence to rent to tenants on Universal Credit as a result of changes announced in the Budget. However, the same survey found that 73 per cent of landlords still lack confidence that they can recover arrears that can occur when tenants move across to universal credit. Read more on the RLA website.

Universal Credit: Rollout Speeds Up But Leaves Problems In Its Wake

A parliamentary committee has re-launched an inquiry into Universal Credit after receiving evidence of the problems encountered by tenants from councils. Here are two of the problems that need addressing urgently:

1.Rising arrears are putting landlords off - The main council housing bodies say 85% of tenants they surveyed on UC are in arrears compared to 39% of tenants overall.

2.UC does not work for all types of housing - Some problems are due to design – such as the waiting days rule, where households have to wait seven days before they are eligible for benefits. Some are unintended, such as the delays and administrative errors in issuing direct payments to landlords for tenants who struggle to pay their rent. Other issues are due to UC being inherently problematic for accommodation for homeless families. UC is not designed for temporary accommodation, but the DWP has insisted that homeless families should still claim housing support through UC. Read more on the Shelter blog.

Landlords Refuse To Take On New Universal Credit Claimants

At a meeting of the Great Yarmouth branch of the Eastern Landlords Association last month, members said they would not take on new tenants in the process of making a claim for Universal Credit. Chairman of the association, Paul Cunningham, said some claimants were waiting ten to 12 weeks for their first payment, forcing them to go into arrears. He also said there have been a number of evictions solely down to Universal Credit issues. He added: “The introduction of Universal Credit in Great Yarmouth last April has proved to be disastrous with landlords now refusing to take any such claimants and evictions rising due to arrears caused by the system.”  Read more on the Great Yarmouth Mercury website.

Freud Says Universal Credit Figures ‘Incomprehensible’

Lord Freud has defended Universal Credit, hitting back at research that shows more tenants are in arrears because of the policy. In direct response to figures produced by the National Federation of ALMOs, which found 86% of those on UC were in arrears, he said: “The figures at the moment are not particularly comprehensible. 79% of those 86% were already in arrears going into Universal Credit. What we are seeing is a population going in and out of work and finding it hard to have a payment going in. The ALMOs have a system of rent in advance but all benefits are paid in arrears. What we are trying to disentangle from that is how much of them are book arrears and how much are new arrears.” Read more on 24housing.

Universal Credit Tenants In Arrears Increases To 86%

The percentage of council tenants on Universal Credit in rent arrears has increased to a “critically high” 86% over the last year, sparking “extreme concern” among councils. The National Federation of Arms’-Length Management Organisations (NFA) and the Association for Retained Council Housing (ARCH), which together represent more than one million council homes in England, carried out annual research into Universal Credit claimants and found the percentage of council home tenants in receipt of Universal Credit who are in rent arrears has increased by seven percentage points – from 79% in March last year to 86%. This compares to 39% of tenants in arrears who do not receive Universal Credit. Download a copy of the research from the Housingnet website.

Minister Reveals 'Trusted Partner' Landlords

The government has revealed the social landlords piloting a scheme to stop vulnerable Universal Credit claimants falling into debt. The DWP have released a list of councils and housing associations taking part in the ‘Trusted Partner’ pilot, to allow ‘trusted’ social landlords to receive vulnerable tenants’ benefit direct before they fall into arrears. Universal Credit directs housing benefit towards the claimant. This has concerned housing associations, which say that some vulnerable tenants will be unable to manage their finances and fail to pay their rent. Under current Universal Credit rules, landlords can apply to have the housing benefit directed straight to them instead of the claimant, but by then the tenant has commonly fallen into arrears of eight weeks or more. Read more on Inside Housing.

Landlord Reveals Findings Of Direct Payment 'Pilot'

A housing association is calling for changes to Universal Credit, after its unofficial ‘pilot’ showed tenants receiving housing benefit payments direct are more likely to fall into arrears. Circle Housing has now published the findings of research, undertaken by Sheffield Hallam University, which tracked how tenants are likely to cope under the government’s flagship welfare reform. Circle’s HB2U scheme piloted paying 349 tenants their housing benefit directly, instead of to their landlord. The results showed that rent collection rates fell 4.1 percentage points to 96.8% for the 349 tenants who received their housing benefit directly. Rent arrears also increased to 2.5%. Read more on Inside Housing.

Social Landlord Possession Claims Fall

Possession claims issued by social landlords have continued to fall as housing associations and councils work to prevent tenant rent arrears from building up. Figures released by the Ministry of Justice show there were just 21,160 claims for possession issued for social landlord properties in April to June this year. This is the lowest figure for any quarter since 2010. The overall number of social landlord possession claims issued in the first six months of 2015 is 48,636, down on the 55,232 issued last year. Social landlord possession claims initially rose from 90,217 in 2010 to 113,175 in 2013, but dropped to 105,645 last year. Download the stats from the GovUK website.

Britons See 41% Of Monthly Pay Vanish On Their Rent

Rising private rents mean Londoners spend on average half of their pay to have a roof over their head, the highest proportion in the UK. But the rest of the country is not in a much a better position, with the average rental cost across the UK taking up 41 per cent of take-home pay. The report comes as squeezed private renters are struggling to meet payments after years of blistering rent rises. Recent separate data shows arrears soared to their worst level in more than two years last month to 9.9 per cent of all rent payable in August, up from 8.4 per cent in July. Across the UK overall, the typical monthly salary is £2,266 and the average rent is £935, meaning renters on average sacrifice 41 per cent of their pay for accommodation. Read more on the Daily Mail website.

DWP Urged To Review Universal Credit 'Issues'

The Department for Work and Pensions (DWP) should review issues with universal credit, the Social Security Advisory Committee (SSAC) has said. SSAC, which advises the government, said changes to payment of housing costs are ‘a constant source of anxiety for landlords, housing associations, claimants and claimant advisers’. Under universal credit, benefit for housing costs is paid direct to households, as opposed to social landlords, in most instances. The SSAC report said: ‘We believe this [direct payment] policy needs close monitoring to ensure that arrears are kept in check and landlords are not discouraged from offering accommodation to benefit claimants.’ Download the report from the GovUK website.

Reduced Benefit Cap Could Be the Killer Blow for Social Housing

The big housing story of the moment is the expansion of the right to buy, but the imminent cut in the benefit cap from £26,000 to £23,000 could have a far more devastating impact upon social landlords and tenants. In London, social landlords who have embraced the affordable rent programme – which can see social tenants charged far higher rents – could be very badly hit by an increase in arrears once tenants receiving housing benefit see their support cut by £3,000 a year. The overall benefit cap is popular among the wider public, but most people don’t realise that it only applies to those who, often through no fault of their own, are paying a high rent. Read more on the Guardian website.