A press release from Lord Freud brings welcome news to many landlords and tenants worrying about direct payment of benefit to tenants.
Under Universal Credit the first payment of benefit will be one week after the initial assessment period of 1 month, at the earliest. This would seem to imply that many tenants in the social rented sector may be able to get direct payments as many may have rent arrears at the start of a claim.
Key points
‘Decisions about whether tenants should receive direct payments will be made in collaboration with social landlords
If arrears build up to the equivalent of 1 month’s rent the decision to make direct payments will be reviewed
If arrears reach the equivalent of 2 months rent, the claimant will have housing payments switched to the landlord, or managed payments’
Re– switching back to direct pay after-
‘Once arrears have been cleared, the DWP will work with landlords to return to tenants to direct payments. In most cases, following the tenant being offered budgeting support, they will return to direct payments within 6 months of the arrears being paid off. ‘
Direct payments to landlords won't, however, be seen as the norm.
Click here for our Universal Credit 2013 course.