The Universal Credit system of payments has now gone “live” in a
number of areas across the UK. It remains to be seen how well the
system works, but there is at least one positive change for landlords
worth mentioning.
Previously it was thought that all payments would be paid directly to
the tenants, with the onus on them to pay rent to the landlord.
Because of this new system it was feared that some tenants would
struggle with budgeting issues and would therefore fall into arrears
with their rent payments, thus leaving landlords out of pocket.
Thankfully a small policy change has been spotted by eagle-eyed RLA
experts and brought to the attention of landlords.
A welcome change in policy
If a tenant is in arrears with their rent payments for more than two
months, direct payments to landlords will automatically be triggered
and the tenant will receive support to help them better manage their
budget. This is a sharp about-turn on previous government policy,
which stated that direct payments to landlords would only be made in
exceptional circumstances. And even that wasn’t guaranteed.
However, there is no word as yet that this reversal in government
policy will be extended when Universal Credit payments are rolled out
across the rest of the country later on in the year. The RLA are also
lobbying for a reduction of the two-month period landlords must wait
before they can apply to have direct payments made, plus more details
to be made to landlords of how they can request direct payments from
tenants.
