Scotland ready to pay housing element of Universal Credit direct to landlords

Now UK government is being urged to follow the Scottish government lead.

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Tenants in Scotland will have the choice of having the housing element of their Universal Credit payment sent directly to their landlord – an option available to social housing and the private rented sector.

Now, the Registered Landlords Association (RLA) is urging the UK government to follow Scotlands lead.

RLA vice-chairman Chris Town said: “Allowing tenants to choose to have their rent paid directly to landlords will enable them to better plan their spending and will prevent many from falling into arrears.

“It will also give confidence to landlords to rent to those on benefit giving tenants more choice.

“We strongly urge the UK Government to follow Scotland’s lead.”

The Scottish government plans use its new social security powers for the first time to increase the frequency of Universal Credit payments.

Universal Credit itself remains reserved, but ministers will use new powers to give claimants the option to be paid fortnightly instead of monthly.

The government also plans to offer to pay housing benefits direct to landlords rather than via claimants.

Opposition MSPs welcomed the move, but said the government should do more.

Holyrood is taking on a series of newly-devolved welfare powers – from personal independence payments to carer’s allowances – and a new social security agency is being set up with a Social Security Bill is set to be introduced this year.

Though the DWP will retain overall control over UC,  the Scottish government is to take on powers to introduce some flexibilities over payments.

Ministers plan to use these powers to give new claimants in areas where a digital planning system has been set up the option of twice-monthly payments, instead of the current monthly system.

Meanwhile, tenants will have the choice of having the housing element of their Universal Credit payment sent directly to their landlord.

Social Security Minister Jeane Freeman said this option would be available to tenants in the private rented sector as well as those in social housing with an increased frequency of payment being the key to many claimants.

She said: “When you’re on a very tight budget as people on benefits are, then it is very hard to budget that amount over a whole month.

“Knowing that a payment is coming to you, for the benefit that you are entitled to every fortnight, makes that budgeting exercise easier for those households and that means you can make better decisions and be more in control of your finances over those two-week periods.”

Freeman said any Scottish government change to the Universal Credit was dependant on what the DWP “could cope with.”

In particular, she said ministers were working to change the current situation where a single benefit payment was made to a single person within a household after lobbying from women’s groups.

She said: “We’re in discussions with DWP about how they can deliver that change for us. So I’d hope that that further change will be something that we’ll be able to do in the near future.”

Confirming that a number of organisations had made the case for the Scottish government to top up the benefit, Freeman said she was “sympathetic” to such claims.

“But I have to make the point that the UK government is cutting welfare spend by £2bn in Scotland by 2020.

“We are currently spending £100m every single year to mitigate the worst effects of those benefits in a context where our overall Scottish budget has been cut by 9.2%.”

Further consultation will be carried out over coming weeks to assess views on the draft regulations.

John Blackwood, chief executive of Scottish Association of Landlords, welcomed the option of direct payments to landlords.

He said: “This should help protect tenancies and minimise rent arrears which will benefit both the tenant and the landlord. It is only fair that private sector tenants have the same option to choose direct payments as tenants in the social sector.”

However, Scottish Conservative MSP Annie Wells said the transition to some benefits could take until 2020 to complete and urged the Scottish government to use more of its powers.

She said: “They’ve asked for a hold-off for three years to take all these powers on board. It’s alright complaining and not governing, but we need to see them actually governing and using the powers they were given.”

Labour’s Iain Gray welcomed the changes, but also highlighted that Westminster will continue to administer some devolved benefits for some time.

He said: “We have this situation where the Scottish government have delayed taking on the powers over most benefits for three years, and we’re not very sure about when the flexibility they’ve talked about is going to come in.”

Scottish Greens social security spokeswoman Alison Johnstone said the rollout of Universal Credit was “clearly causing serious problems” in parts of Scotland.

She said: “We look forward to seeing the Scottish government’s plans for use of its ‘new flexibilities’ on Universal Credit in more detail because it’s becoming increasingly clear that the DWP remains unlikely to improve how it operates.

“The changes the Scottish government propose are welcome and will make life easier for people receiving Universal Credit. It’s important we make the most of every power coming our way.”

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