CIH response to select committee report on welfare reform

Published on Wednesday, 03 April 2013 11:23
Posted by Vicki Mitchem

MPs have raised concerns that universal credit could leave the benefits system more vulnerable to fraud as well as resulting in increased rent arrears.

The Chartered Institute of Housing gave evidence to the Commons and Local Government committee on the implementation of welfare reform by local authorities, which was published today.

Universal credit will replace six benefits, including housing benefit, with a single payment which will be paid direct to the claimant.

The first trial of the system starts on April 29 in Ashton-under-Lyne before the national rollout gets underway in October.

Meanwhile six projects across Great Britain have been trialling different aspects of the direct payment of housing benefit to social sector tenants.

The report also called on the government to issue a clear definitition of 'vulnerable' tenants - who will have their rent paid direct to their landlord - and provide more guidance on the arrears trigger that will switch payments back to landlords when arrears reach a certain level.

The committee said results of the six direct payment demonstration projects must be taken into account.

CIH director of policy and practice Gavin Smart said: "We share several of the significant concerns raised in this report – many of which CIH warned about in 2010 when the reforms were first proposed.

"Universal credit is a massive change for housing providers and tenants alike and it's essential that housing providers have a clear, stable timetable to allow them to put effective new systems into place.  There is still far too much uncertainty – the Department for Work and Pensions announced last week that some of the universal credit pilots are to be delayed and it's extremely worrying that such changes are still taking place at this late stage.

"Housing providers need to know how 'vulnerable' tenants – who will have their rent paid to their landlord – will be identified, and what the trigger that will switch payments back to landlords when arrears reach a certain level will be.  Government has consistently promised to provide this information and it's crucial they do so as soon as possible so landlords and tenants can properly plan ahead. The DWP also needs to make sure that all the information from the direct payment demonstration projects is made available in good time so providers can create the best possible system in the circumstances.

"There are many welfare reforms coming into force this year and although the government has issued impact assessments for some individual policies, an overall assessment is urgently needed, coupled with better guidance for landlords and tenants."

The report has also called for the government to look at the impact of the social sector size criteria – the so-called bedroom tax – on divorced parents and those with disabilities.  Gavin Smart said: "We hope the government takes this recommendation very seriously.  People who need a bigger home because of a disability will be unfairly affected by the bedroom tax and we believe they should be exempt."

Source: CIH

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