Demonstration projects have been running since June 2012 to try to test out how direct payments of rent to tenants might work under Universal Credit.
Initial results say- ‘Over the first four months, 6,220 tenants were paid their housing benefit directly. Against a total level of rent charged of £7,692,844 over the period, payment collection rates stood at 92%.’ ….. ’A total of 316 tenants have been switched back to payments to their landlords – either because they have reached triggers for switch back or have been switched back due to early intervention. ‘
The projects are investigating a range of elements of direct payments to provide protection for landlords and tenants including:
· different levels of support social sector tenants may need to move to direct payments of housing benefit, such as advice on managing personal finances and budgeting
· the exemptions that need to be in place for direct payments
· payment switch-backs to the landlord if a tenant falls into arrears
· the support to help tenants in arrears, to pay back their arrears and to potentially return to direct payments
· early intervention switch-backs before arrears reach trigger points.
The project will run for 1 year in total and be used to inform the implementation of Direct payments under Universal Credit. Click here for our Universal Credit 2013 course.