With public spending at an all time high, the government is trying out a
series of hard-hitting reforms in an effort to claw back some money. The
cessation of Child Benefit payments to more affluent parents has been a
popular topic of discussion in the last few days, but reforms are also in
the works for Housing Benefit, which is causing many landlords some
concern.
One recent trial scheme encouraged landlords to offer concessions on
their rents in return for having Housing Benefit paid directly to them
rather than the tenant. Caps to Housing Benefit have affected a lot of
tenants in the private sector, as many are no longer able to afford
larger accommodation, so any concession made on the monthly rent is
likely to be most welcome.
Lord Freud, the Welfare Reform Minister, has declared the trial scheme a
huge success and claimed that in London around one third of landlords had
willingly reduced the rents on their properties in return for direct
payments.
“There has been no mass exodus of people moving out of city centres or
widespread homelessness because of our housing reforms,” he was quoted as
saying at the NLA annual conference.
However, in a recent survey of more than one thousand landlords, more
than 60% said they were unwilling to reduce rents in return for direct
payments and many expressed concern over the government’s failure to be
clear about when exactly landlords could demand a direct payment—the
government has refused to guarantee the current policy of releasing
payments direct to landlords once a tenant has fallen 8 weeks into
arrears. As such, more than 90% of those surveyed said they would think
twice about letting to tenants on benefits.
