Rehaul of Universal Credit system will see more landlords paid directly

A new online system will ensure more landlords whose tenants receive Universal Credit are paid rent directly.

The latest government shake-up of the much-maligned benefits system will give “greater certainty” to private sector landlords who let to Universal Credit claimants by allowing them to request that the benefit is paid directly to them.


Universal Credit has been criticised by charities who said the way the benefit is distributed on a monthly basis, plus a five-week wait for an initial payment has left some claimants struggling to pay their rent.


Universal Credit is paid monthly and claimants must budget for rent, bills and other expenses from the lump sum.


Read more: Letting agents breaking existing laws on tenant fees


As a result, an increased number of landlords were refusing to rent to Universal Credit claimants over concerns they would not be paid and charity Shelter blamed the system for a spike in homelessness.


The current system allows those considered most “at risk” to apply to have their rent paid directly to their landlord under an “alternative payment arrangement” (APA). According to Work and Pensions secretary Amber Rudd, only 5% of claimants in the private sector currently have their rent paid directly to the landlord compared to one third in social rented housing.


Ms Rudd said: “People in the private rented sector already face a far higher risk of losing their tenancy.


“And I know from talking to claimants and landlords that the current system isn’t working for some of them.


Read more: How to raise the rent


“So we need to make it easier for tenants in the private sector to find and keep a good home by giving landlords greater certainty that their rent will be paid.


“Therefore I’ve asked the department to build an online system for private landlords so they can request where necessary for their tenants’ rent to be paid directly to them.”


The secretary of state for housing, communities and local government, James Brokenshire said the new measure was “an important change”.


“The measures announced today will ensure that landlords can receive rent from those on Universal Credit directly into their accounts. This important change will help strengthen the choices and opportunities available for those on Universal Credit to secure the homes they and their families need.”


Discount Landlord provides a range of specialist insurance products to help you protect your investment including Rent & Legal protection Call 0800 294 4522 to get a Quote now!

(Visited 88 times, 1 visits today)
10th June 2019