Member Article

Welfare pilot proves government must change course

A North East property expert believes results from a pilot project prove the government must rethink planned welfare changes “before it’s too late”.

Sweeping changes which come into effect this October will see 6 current benefits – including housing benefit and income support – replaced with Universal Credit, a single monthly payment.

As part of the changes, housing benefit will in future be paid direct to tenants, rather than directly to their landlords as is currently the case.

Feedback from six areas across the UK were housing benefit is already being paid directly to tenants showed housing organisations taking part in the pilot voice concerns about rising rent arrears and that the process was a “very resource intensive exercise” which lead to other services being “compromised”.

Quotes from tenants receiving the benefit, meanwhile, expressed their fears about how the changes may affect them, including:

“I would find it very hard if my children were hungry and the electric gone, knowing I have money in the bank for my rent, they go hungry or I pay rent, very tempting not to pay rent and feed my children” “I suffer from substance abuse and would not be good on the scheme as I’m in a lot of debt… why put temptation in front of my eyes”

Ajay Jagota of KIS Lettings, who manage properties for 700 landlords from branches in South Shields, Sunderland, North Shields and Welwyn Garden City believes the results of the pilot show the government need to rethink the changes.

He said: “It’s not that I’m opposed to direct payments in principle, it’s that this research makes clear that they should be an option not an obligation.

“The research is full of powerful and compelling testimony that not only are direct payments completely unsuitable for some people, some people just don’t want them.

“I don’t know why the government believes these payments have to be universal, to me it makes a lot more sense to have a more flexible system where people have an option about how they personally want to receive their benefits and to pay their rent.

“It’s clear from this research that the government has no option but to introduce a quicker, mandatory, trigger for when payments revert to going directly to the landlord – in my view after 4 weeks of rent arrears.

“I think they should the government should also take a long hard look at introducing direct payments alongside an education programme. If tenants had to go on a short course before qualifying for direct payments not only would the government be equipping them with the people with the skills they need to make a success of the scheme and to run their households better in general, it would also highlight the households where direct payments are unsuitable or unwanted.

“There is no point having a piloting new ideas if you’re just going to plough on regardless of what the pilots tell you. It’s clear to me that the government should be listening both to these housing organisations and to private landlords - who have been dealing with issues like these for several years – before it’s too late”.

This was posted in Bdaily's Members' News section by Ajay Jagota .