'Change it now!' - Lettings group demands more Universal Credit reform

The Residential Landlords Association says the government’s changes to Universal Credit don’t go far enough to prevent rent arrears.

The RLA says it backs a new call from charity Citizens Advice which says a fundamental overhaul of Universal Credit is necessary because half of all claimants who seek help are at risk of being evicted owing to rent arrears and hardship.

Citizens Advice says the minimum five-week wait for a first benefit payment left huge numbers of renters unable to pay bills or obliged to go without essentials such as food or heating. Well over half have to borrow from family and friends.

Responding to the Citizens Advice report RLA vice-chair Chris Town says: “One of the main drivers of rent arrears has been that tenants cannot routinely choose to have the housing element of Universal Credit paid directly to their landlord at the start of a claim. Many tenants prefer to have the assurance that their rent is paid and their right to do this should be introduced immediately.

“This needs to be coupled with lifting the freeze on housing benefits and the housing element of Universal Credit. Housing cost support is simply not keeping up with the realities of rents in the private sector, despite them falling in real terms over the past year.”

The RLA’s most recent research shows that of those landlords with tenants on Universal Credit, 61 per cent experienced them going into rent arrears in the past 12 months. 

This is up from 38 per cent in 2017 and 27 per cent in 2016.

A report for the RLA by experts at Manchester Metropolitan University noted that caps on the Local Housing Allowance Rate have been a key driver of homelessness from the private rented sector.

The Office for National Statistics shows that in the UK, average rents in the private sector increased by one per cent in the year December 2018, much lower than inflation.