Agents demand payment changes in upcoming Autumn Statement

Propertymark is urging the government to use next month’s Autumn Statement to support low-income households in the private rented sector in England and Wales by reforming Universal Credit.

The body also wants the government to reopen communication with organisations that represent landlords and agents as was the case prior to the pandemic.

Introduced in 2013, Universal Credit replaced many pre-existing benefits such as housing benefit and child tax credit and is designed to help low-income households with living costs.  

Propertymark wrote to the Secretary for Work and Pensions, Mel Stride, in January to urge the Department of Work and Pensions to reopen a Private Rented Sector forum which previously led to the digitalisation of managed payments of arrears and improved the rental sector for both landlords and tenants in receipt of benefits. 

The DWP closed the forum due to the demands of Covid and high numbers of people claiming benefits. 

However Mims Davies - the Minister for Social Mobility - has told Propertymark the government would like the forum to start again, with the first one this year taking place on November 22. Representatives from Propertymark will be attending to address concerns about 2.5m people still receiving ‘legacy’ benefits like tax credits and housing benefits.  

The DWP aims to complete the migration of around one million claimants to Universal Credit by March 2025. 

In the Autumn Statement last year, the UK government announced it would defer the managed migration of those on income-related Employment and Support Allowance to UC until 2028. It said the delay would save some £1 billion.  

In addition to calling for the safe managed migration of benefits, Propertymark’s latest document to the UK government, called on politicians to reform the benefits system by providing claimants with a choice over whether they want Universal Credit paid monthly or twice monthly to assist with budgeting. 

Furthermore, Propertymark argues that the issue of tackling rent arrears can be dealt with by turning the Universal Credit into a non-repayable grant from the first day of the claim and to end the five-week waiting time for the initial payment.

Propertymark highlighted that under the current arrangements, paying awards monthly does not reflect the lived experiences of many claimants, and it causes significant cashflow problems for them. By making the system more flexible, the UK government can support people from a wide range of personal circumstances, especially those in the private rented sector.  

Universal Credit claimants in Scotland have the option to receive their benefits twice a month.  Finally, Propertymark argues that increasing the Local Housing Allowance Rate to the 50^th percentile will ensure people have more access to affordable housing options.

The trade body’s policy officer, Tim Thomas, says: “We are pleased that the government have listened to our call to reopen engagement with key organisations. By reforming the welfare system, the UK government can ensure that claimants are more able to pay their rent and not go into debt. 

“By acting on Propertymark’s campaign aim to reopen communication with key organisations, we can support the government in safely migrating tenants on legacy benefits to UC providing it is financially advantageous for them to do so. This will further stabilise the private rental market for some of the most vulnerable tenants.”