Social landlords to get direct payments of benefits under UC changes

The Department of Work and Pensions has written to housing associations to confirm the changes to the way Universal Credit is paid to social landlords.

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The Department for Work and Pensions has confirmed they are testing a new system to pay social landlords direct payments of benefit.

This would see landlords receiving money from the DWP at the same time the tenant receives their Universal Credit payment.

Third Party Deductions for outstanding arrears will still be channeled through the four-weekly Third-Party Creditor schedule.

The idea that is the test is successful, it would be fully rolled out to all social landlords in early 2020.

In a letter, Neil Couling – Universal Credit SRO – said: “I’m pleased to let you know that this week, we have started a small-scale test with a small group of social landlords to align the way that we pay Managed Payments to Landlords with a claimants Assessment Period.

“This means you will receive the housing cost element at the same time as your tenant receives their UC payment.

“This will also involve those social landlords in the test receiving a daily schedule of their tenants housing cost payments where there is a managed payment in place, through the landlord portal.”

The changes come after a campaign from the four housing federations – National Housing Federation, Community Housing Cymru, Northern Ireland Federation of Housing Associations and Scottish Housing Federation of Housing Associations – in which they had six asks over the future of Universal Credit.

Responding to the news, Sue Ramsden, Policy Leader at the National Housing Federation, said: “This change is welcome news and a good example of social landlords and DWP working together to find effective solutions.

“A new system of direct payments will make it much easier for landlords to keep track of rent payments, saving them a great deal of time and resource. We look forward to the roll out of the new system in early 2020.”

Sally Thomas, SFHA Chief Executive, said: “The delay in receiving direct payments and the lack of information on the landlord portal have been major concerns that have been highlighted by our members.

“These changes were top of the Six Asks campaign we have been running with our fellow UK housing federations, so this is certainly good news for our members and their tenants.

“However, we still believe the system of Universal Credit remains inherently flawed and will continue to campaign for fundamental changes, not least the initial five-week wait and the four-year benefit freeze that have caused some tenants to be pushed further into poverty.”

Will Atkinson, Policy and External Affairs Manager at Community Housing Cymru, said: “Flaws in the Universal Credit system including a lack of information being shared on landlord portals has caused unnecessary delays for housing associations.

“This new system, built in partnership between social landlords and the DWP,  will reduce the administrative burden on landlords, in addition to enabling housing associations to provide more targeted support to tenants who fall behind on their rent.

“However there are still changes to be made and we will continue working with DWP to ensure Universal Credit works for all, including ending the five week wait for payment.”

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