It doesn’t take an accountant to figure out that some long overdue changes are needed to the UK benefits system as too many people are taking advantage of the cash on offer and playing the system for all it’s worth.
Take for example Housing Benefit: when a family is able to claim more than £100k per year to live in a Mayfair mansion, there has to be something seriously amiss somewhere! This is just one of the issues the government is trying to address with the introduction of the ‘Universal Credit’.
How will the introduction of Universal Credit affect landlords?
Many landlords let their properties to tenants claiming benefits. The current Housing Benefit system allows for rent payments to be made directly to a landlord, which is useful if the tenant is not a reliable payer. Unfortunately, the government plans to scrap this policy unless a tenant has learning difficulties or is mentally ill, which could lead to a rise in rent arrears.
No landlord wants to deal with rent arrears—it takes time and money to sort out. Sadly, if tenants on Universal Credit end up with a poor payment record as a result of spending their benefits down the local pub instead of handing over the cash to their landlord, they are going to have a problem finding a landlord who is willing to offer them a new home.
The Minister for Welfare Reform (Lord Freud) tried to address some of the concerns held by landlords at the recent NLA National Conference in a question and answer session, but many landlords still remain sceptical about whether the new system will work as well as the government hopes.
