How Universal Credit Will Incentivise Rent Debt

rent-bookA perverse incentive in the Universal Credit pilot scheme has already emerged which will mean that social housing tenants who go into rent arrears will be able to have the housing element of the new benefit sent direct to their landlord.

Universal Credit will feature Direct Payments, meaning that council or housing association tenants will receive a monthly cash payment towards their rent.  At present Housing Benefits for social tenants go directly to social landlords in most cases.

This senseless move is based on yet another of Iain Duncan Smith’s pet obsessions, which is that housing benefits going direct to tenants will teach claimants to manage their money.

Housing Associations have been horrified by the changes, issuing warnings that they expect rent arrears to soar.  The DWP’s panicky response to this has been to decide that claimants who fall two months in arrears will automatically have payments switched back to landlords.

This means that tenants concerned about the impact of Direct Payments can simply avoid paying their rent for a couple of months.  This will automatically trigger their benefits to be directed back to their landlords, removing a stressful and senseless burden for already struggling claimants.

To be extra sure that their tenancy is not affected, claimants can keep hold of the cash and as soon as the two months are up then simply pay off the arrears.  Alternatively they could arrange to pay back the money owed in installments and use the two month’s housing benefit as an interest free loan.

It is not clear if tenants will be switched back to Direct Payments once rent arrears are paid off.  If they are then they will just have to stop paying their rent for a couple of months again.  As long as there is a continuous willingness to pay, and arrears stay around the two month mark, then few social landlords will launch formal eviction proceedings.  And just in case they do, the canniest tenants will make sure the rent is safely in the bank to be handed over any time the situation gets a little too hot for comfort.

In fact with Housing Associations also set to take a hit due to the new payments system, it would even in be their interest to support tenants to go into short term arrears. Social landlords are likely to ignore rent arrears once they hit five to six weeks, knowing that the trigger point, which will  clear up any future rent problems, is just a fortnight away.

This is exactly the kind of perverse incentive that the Government promised would be brought to an end due to welfare reforms.  In truth it will be the first of many as 50 year’s of steady development in the Welfare State is thrown away overnight in favour of Iain Duncan Smith’s endless back of the envelope crazy schemes.

The DWP have made clear that this arrangement may not stay in place as Universal Credit is fully rolled out.  The alternative however could leave some social housing providers on the brink of bankruptcy as the most marginalised tenants – who may have well documented drug, alcohol, gambling or debt problems, are given a huge monthly cash sum intended to pay their rent.  The reality is for some this will be a temptation they are unable to resist and lead to huge rent arrears.

Ultimately this will mean more evictions, which will be devastating for those tenants most in need of help, and hugely expensive for both social landlords and the tax payer alike.  Those evicted are likely to be shunted into the far more costly private sector or even face the extortionate rents charged by temporary accommodation and hostels.

Iain Duncan Smith and Lord Fraud are about to learn a stark lesson which will no doubt teach them exactly why the welfare system was quite complicated.  Unfortunately by the time that happens it will be too late for all of us, as the Daily Mail inspired delusions of two desperately out of touch rich men plunge millions of claimant’s lives into chaos.

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117 responses to “How Universal Credit Will Incentivise Rent Debt

  1. If its not broken,,,dont fix it!! why change a system that is already working it makes absolutely no sence..are they mad???(stupid question I know).

    • They want some benefit claimants to waste the rent payments. Once that happens they can use it as an excuse to remove the housing benefits from everyone.

      Teaching fiscal responsibility is not the agenda here.

  2. Imagine looking into your bank account and finding over 2 fucking grand in there!
    Which is possible with the prices of the rents in London.
    Very tempting for some.

  3. I’m so sick of these millionaire scrounging dictators!!

  4. One of the problems of paying housing benefit directly to tenents is that private landlords often ask for garantors before agreeing to rent a house. It is the garantor who would be pursued for rent arrears. This will disincentivise people from becoming garantor for friends/family in need. Well done IDS you’ve found another way to bring misery to the disadvantaged.

  5. Pingback: How Universal Credit Will Incentivise Rent Debt...

  6. Speaking of Universal Credit, in the case of a payment the DWP might miss, and at a later date decide they owe, they have, in the past, made a lump sum payment. Would such a payment be affected by the cap? Can they effectively avoid the responsibility of repaying money they owe, by including it in the month`s UC payment, and claw back much of it?

  7. These are the same numpties who simultaneously want to micro manage the finances of people on low incomes by introducing payment cards for day to day living AND give them substantial amounts of cash for housing costs. Oh just fuck off back to Chipping Norton is my response. The UC omnishambles is guaranteed to be spectacular. Sadly a lot of innocent people are going to get hurt before it implodes.

  8. I have to say it again: we assume that a lot of social tenants are either feckless or addicted or both – exactly what the stereotype says we are. It will hardly generate sympathy for our plight if you say they will use the rent money as an interest-free loan or play the system by regularly getting into debt and then repaying it or spending it on drugs straight away. Private tenants don’t do that (well, most of them anyway) despite facing the same demands on their income and their rents are much higher making it all the more tempting to steal the money so let’s not assume that arrears will be accrued by the social tenants as a matter of principle.

    This brings back the striver vs skiver debate: if someone fails to pay their rent despite getting the housing benefit and they get evicted, then shouldn’t the house go to someone who knows how to live within their meagre means, as a matter of social justice? I am dying to move out of my private let, got nil points on my social housing application and private lets are either too expensive or do not allow DSS.

    At the moment, if someone told me there’s a council house available and the current tenant is in arrears through their own negligence, I would evict them with my own two hands before you could say universal credit.

    • From what you’re saying you are as bad as the Tories, Just because they haven’t paid their rent does it mean its been spent on drugs? There could be 1001 other reasons including DWP cock ups. Ive now been a month with nothing so do you want to come round and kick my wife, my 3 kids and I onto the street. I’m no Skiver, up till 18 months ago I’d always worked then I became ill. Atos decided I’m fit for work 5 weeks ago so i’ve been left with nothing for over 4 weeks now because between Atos, Job center and the DWP they can’t decide what i’m entitled to

      • Billy, please read my comment again.
        1. The point of my post was that most tenants are going to pay their rent because they are NOT what the stereotype says they are. The topic of arrears is irrelevant in my opinion: most will pay, no problem.
        2. I said I would carry out the eviction if the current tenant was in arrears because of THEIR OWN NEGLIGENCE (DWP/council error or delay is just that – it has nothing to do with you). My landlord would evict me if I was three months’ late with rent or if I was persistently behind with my payments (unless housing benefit was paid late). Do you think it’s fair that someone squanders their rent money but is not evicted while hundreds of families live in substandard B&Bs or inadequate accommodation because there is no sufficient number of social houses available?

        I know what it’s like when DWP screws up and you and your family are left to suffer. I take it you did ask for reconsideration of the decision to deny you ESA and then appealed? I hope the problem gets resolved very soon. All the best to you.

    • UKIP are Fascist Bastards

      Workshyscrounger, that’s such a bloody tory argument and based on an ideological distinction between the ‘deserving’ and undeserving poor’. It’s also sadly the direction in which social landlords are increasingly moving, but the point of social housing is not just cheaper rent. Given there’s so little of it to go round, one of the reasons some people are allocated social housing over others is because they’re less likely to access and manage in the private sector and are therefore at greater risk of homelessness. That doesn’t mean they’re irresponsible or whatever other words you wanna use to describe them. There can be a whole range of reasons why people get into rent arrears. When rent is paid directly to people who are addicted to alcohol and drugs, they’ve been known to spend it on alcohol and drugs. That’s not because they’re irresponsible but because they’re addicts. That’s not a stereotype but a fact. Another group, care-leavers are, for a whole range of reasons, more likely to get into rent arrears than those raised by their families. Again that’s a fact, not a stereotype, and one of the reasons why they’re offered social housing. The fact that a large number of rough sleepers are care-leavers is another. People with children are given social housing over those without because it’s harder for families to find somewhere to live and the consequences of their homelessness is greater – Kids living on the street are taken into care. Too many people blame homelessness on the individual and that’s why I think Universal Credit is part of a much bigger Tory-plan to destroy social housing.

      • Here’s my reply. It got too long for a comment: http://wp.me/p3kXkS-4j

        • Without wishing to nitpick – “save up”?

            • wss – we agreed earlier (I think) that the current levels of entitlement being paid within JSA/Tax credits (and as far we know, Universal Credit) do not constitute a safe, basic income and there is typically a shortfall of around 3 days in every fortnight (or up to 5 in a month). A recent FOI request which asks for clarification of today’s levels proportionate to 2005 as a percentage of the average income which would suggest that some people have serious concerns about the levels at which benefit are currently being set. In relation to the need for citizens to be able to maintain body and soul and continue to live on a low income under 2013 costs-of-living. (A long-winded way of saying “The amounts are inadequate”). 2/3 days in 14 without money for essentials = up to 20% of the time.

              Everyone’s circumstances have variables and factors which may affect their total resources (they may be a gardener with access to an allotment, be part of a couple or pool resources regularly with a friend; have support from friends and family) but if we take the above combination of benefits (& for some this is JSA alone of £71.70 or £53.[?]) as the only available cash sum – then your question doesn’t make any sense. (Saving up can only happen once basic needs have been met – as can pursuing other life goals). ‘Maslow’s Hierarcy of Needs’ (Theory of Human Motivation) outlines this idea.

              Or if you prefer, if the money can’t be made to stretch across the fortnight/month, and this is true for much of the time, a rational person is unlikely to put money aside (withhold it from themselves/their family). Without disposable income people are unable to save for a rainy day/holiday/Xmas etc. (Which explains why they tend to focus on finding work which will pay them as much as they are able to negotiate – traditionally within what they/their GP considers to be their ability to work).

            • Off all the choices available, saving up is the best option for me (have no stuff to sell, no family support, cannot afford loans – payday or crisis; begging, stealing and drug dealing are also out of question). I think it’s most rational to spread the shortfall over as big a period as possible rather than hope that someone will rescue me at the last moment.

  9. To recommend thrift to the poor is both grotesque and insulting. It is like advising a man who is starving to eat less.
    Oscar Wilde, (1854 – 1900)

    • (Whatever you believe to be their intention) the government have chosen now to foist upon the most vulnerable group of people in society (who are already subject to a regime of sanctions/conditionality and trying to live on a fast-decreasing income in very real terms) what is, relatively-speaking, a vast sum of money – on a regular basis. (Real, not monopoly money). With the expectation that almost all of these people, almost all of the time, are strong enough mentally to somehow be able to separate out their own/their children’s unmet needs from the fact of the money that they fully understand does not Actually Belong To Them/is already ‘spoken for’ But Is In Their Account. This, in spite of the fact that it is set to regularly show up on their balance statement – very likely at a time when the kitchen cupboards contain very little, which is likely to be the case for at least several of the days in any one month.

      There does seem to be at least an elements of rubbing salt into a wound and it does also feel (in advance) exactly like dangling a loaf of bread above the head of a hungry man (& his family if he has one) next to a large sign reading “Do Not Touch”.

  10. Reblogged this on TheCritique Archives and commented:
    In short, IDS is a paternalistic klutz.

  11. The only people the new system will benefit is the banks. People may end up a few pence short on a direct debit and suddenly that £30 the bank can take when they like, meaning next month they are short for 2 separate DD so that will be a £60 bank charge, Its all ridiculous and wrong, Why did they bother surveying X amount of tenants as 80% of those surveyed said they would rather their benefit was paid straight to their Landlord to save the worry and risk of it being used elsewhere but still they do their own thing. We no longer live in a Democracy we are living under tyrants who are only interested in their own greed

    • Simple answer, if they insist you set up a direct debit do so, then cancel it the next day, problem solved. I just use them at the moment for certain things with fixed costs I know about at leave that money in the bank. All the rest of the cash comes out and I pay in cash everything else. Not letting the banks have use of even the smallest amount. Only a couple of insurances and my interwebz.phone are Direct Debit.

  12. “This is why the UK Government will never truly impose proper anti-money laundering controls, because to do so would be to undermine the system which keeps foreigners’ dirty and criminal money from travelling through the City of London, and enables Cameron and Osborne’s school and University chums to wax fat on the proceeds, whether from legal fees, accounting services, banking advice, or just plain old-fashioned relocation services!”

    http://rowans-blog.blogspot.co.uk/2013/04/russian-money-laundering-in-london.html

  13. “Dance on Thatcher’s grave, but remember there has been a coup in Britain”

    http://johnpilger.com/articles/dance-on-thatcher-s-grave-but-remember-there-has-been-a-coup-in-britain

    • Landless Peasant

      Pilger is spot on:

      Perhaps it is too easy to dance on her grave. Her funeral was a propaganda stunt, fit for a dictator: an absurd show of militarism, as if a coup had taken place. And it has. “Her real triumph”, said another of her boys, Geoffrey Howe, a Thatcher minister, “was to have transformed not just one party but two, so that when Labour did eventually return, the great bulk of Thatcherism was accepted as irreversible.”

  14. One concern I have regards folks who go into arreas then have Housing Benefit paid direct is they could have substantial amounts taken off their Universal Credit payments to help pay back the lost rent, much the same way folks sometimes find thmselves paying up to £20 a week on fuel meters, etc.. Leaving ppl with even less to live on.
    This system of 4 weekly payments as also the inclusion of housing costs is going to cause great chaos for all those involved and who rely on on social security.
    Govt thinks that is how to make folks more responslbe. Yeah. sure! Many low paid ppl get paid every 2 weeks . So this we all get monthlty pay is garbage. Also, this talk of budgeting, well, it’s easy when you earn the pay of these politicians. Anyone on min wage, would need at least 30 hrs just to get near to £200. and most jobs advertized don’t even come close to that now.
    This Government at Westminster is waging war on the people.

    • Landless Peasant

      I’ve never had a salaried job, was always paid weekly, in cash. And sometimes I’ve done casual work that was paid daily. Much better.

  15. Why is it so terrible to expect adults to take responsibility for managing their own finances?

    Besides, this method of payment is already happening in some areas. I rent privately and my local council pays housing benefit (which incidentally doesn’t even cover the full cost of my poky one room bedsit) directly to me.

    It’s quite handy, actually. Yes, I occasionally ‘borrow’ from the housing benefit if an unexpected expense comes up and I’ll consequently get a week or two in arrears. But with a modicum of self discipline I always manage to get back on track. If I didn’t, I’d get chucked out. And I’d only have myself to blame.

    Having said that, I can see there’s a case for introducing safeguards into the system whereby people struggling with addictions could have the option of asking for rent to be paid directly to their housing provider. In some cases it may even be helpful to pay Universal Credit weekly rather than monthly, to reduce the risk of vulnerable people running out of money long before the end of the month.

    But we’re surely talking about the exceptions here, rather than the vast majority of claimants? And doesn’t it make sense to structure the system around the needs of the majority then build in safeguards to protect the minority – rather than building the whole system around the assumption that benefit claimants are incapable of managing their money or their selves?

    It’s assumptions like that, after all, that lead to politicians suggesting we should all be given benefits payments cards since we obviously can’t be trusted with cash. Or that we should all be sent on expensive and utterly ineffectual Work Programmes since we obviously can’t be trusted to manage our own Jobsearch strategy. Oh, wait, that’s already happened….

    • Thank you so much for that – I thought I was all alone thinking that.

      • You’re not on your own by any means – but it’s quite complicated. I am not 1000% sure but I think it possibly becomes more complicated if there are dependants, so wouldn’t think it’s likely to not be just a few exceptions who struggle. There are substantive differences between managing tiny amounts of money four-weekly rather than fortnightly – articles have been written recognising this. The bedroom tax has just come in. So has council tax ‘support’ (another bill). Income in real terms is falling fast, everything from bus fares to soap powder to gas to water to lighting to shoes to food has increased rapidly in price and benefits don’t even begin to match this. Things don’t look promising.

        • “wouldn’t think it’s likely to be just a few exceptions”

        • I am just worried they will introduce the benefit payment cards if we all keep on going about it. If I can only shop in the big supermarkets, I won’t be able to afford as much as I can now. I didn’t know the monthly budgeting is meant to be harder that fortnightly. Personally, I can’t wait for it. I will read on about it.

          • I know what you mean and its a fair point, but we shouldnt make demands on their terms. Being able to have your rent paid direct to your landlord is a sensible way of administering it for everyone concerned when it comes to social housing tenants (for those who want it), and may encourage more private sector landlords to rent to claimants. It’s a world away from food stamps which is a purely punitive measure, which as you say will make it harder to budget and survive, not easier,

          • wss – it’s only from my own experience that I (started to) believe the smaller the amount of money (per week/month/overall) available to live on, it’s harder to stretch it out over a longer period of time than several shorter periods. (I didn’t do well in maths at school so maybe take anything I say about this with a large pinch of salt). When I was in work, I didn’t feel this way (even in a fairly low-paid (NHS) job+tax credits/paid monthly/using direct debits etc – if sometimes struggling a bit in the run-up to pay-day). But when it comes to living on JSA/Tax credits currently, which bear no relation at all to the costs of living & etc. – it feels easier (for me) to have small amounts ‘little & often’.

            My neighbour is long-term unwell and has lived on a low income for many years panicked a bit when the switch from weekly to fortnightly benefit payments happened a few years ago (they’ve introduced the change in stages). Then, of course, they/we got used to it & now it seems ‘normal’. The article I read (it was one, not loads) seemed to confirm my thought that there’s often a shortfall towards the end of week two (but at least there’s the knowledge that only a few days left til next payment, so even if it’s difficult, it’s somehow ‘not the very end of the world’ – there are possible ways to manage and money coming in on the horizon (!). The article I read also talked about there ‘frequently’ being a 2/3 day shortfall and said that averaged over 4 weeks the shortfall will effectively double – so 2 lots of shortfall added together – if it was 2/3 ‘more difficult’ days in the fortnight, it could be 4/5 in a four-week period, before next 4-weekly payment limps round.

            Your point makes sense that some things are cheaper and do make more sense to buy monthly (for me it’s travel tickets) – weekly they’re not always affordable and end up buying daily instead – which costs more over time. (if that makes sense). So food-shopping wise, there probably is also a logic to having the money in one amount – it’s just that ‘life on benefits’ seems somehow to lend itself more to doing almost everything ‘little & often’ (I don’t know if that’s just a mindset) – it’s more a ‘fear of running out completely’ (not going to go on about this any more as people will have their own experiences of this/what works best for them).

            • The way I see it is that, apart from the transition period (when you do not get the fortnightly payment and have to wait for the monthly one to kick in, nothing really changes assuming you get the same amount of money.

              Once the monthly payments come in, I can either budget weekly (and have eg one-day shortfall), fortnightly (two-day shortfall every two weeks) or budget monthly (£150) (and have a monthly shortfall of four or five days in one go). No matter how you budget, the shortfall over a year will be the same: 52 days in my example. The point is to stick to one of the budget models and not touch the rest of the money in the account. Also, to save up for the transition period – thankfully we have at least until next April to do that.

              As for little and often – I think it is a mindset. We used to buy all our shopping on a weekly basis and two months ago switched to a big fortnightly shop (across ten stores depending on their offers) and it seems to be working better for us. You just have to plan more carefully and know eg how much pasta or toilet roll you use and err on the side of caution. We noticed that even if we pop out for bread and milk, we are tempted to buy other things, change our meal plan and overspend.

              We also have this concept of “imaginary debt”. We could afford to spend more that £35 a week we plan for (probably around £38) but the extra £3 allows us to do some unplanned shopping and still not end up in real debt. So when we come across some great reductions or use more bread or milk than normal, it comes in useful.

    • It’s a question of pragmatics. How do you identify the people who might have problems before they get into trouble, surely the best way of doing that is to make it a matter of choice for claimants – which is allowing people to be responsible for their finances and just giving some a useful tool to ensure they stay out of arrears.

      Practice in the private sector regarding this has been different from place to place, I’m private sector and my rent goes direct to my landlord, because thats the only terms under which they would accept housing benefit and let me move in. Direct payments for everyone means it will be even hard to find private sector accommodation.

      • I know which option I’d always choose and did opt for when offered the choice – out of some sort of gut-feeling initially and then borne out by experience. There is no wriggle-room and getting any sums wrong around the time when rent is in account/needs to go out of account is just not worth it.

        • something survived...

          They should offer everyone a choice so they can please their landlord and fit their own circumstances. Some private landlords demand direct payment and others the opposite. Also if you have a big expense or a big debt, then you need to dip into HB cash just to keep treading water, so you need control of the HB money. They ought to stop banning us from saving money though, how are we supposed to save for anything big? Remember, the government loans are gone and grants too, so the only loans now available, are definitely going to be taken out of our benefit, leaving us with not enough to live on or pay our rent, so we’d be worse off for taking the ‘loan’.

    • Good post. Key is we should expect adults to manage their own fnances. but you don’t need to be claiming any state benefit. If you think about it, managing ones finances takes great skill, discipline, effort and good organisation. Unmanageable debt or irresponsible lending, is just as bad. The issue is generally, taxpayers could feel rightly pissed off if we allow ‘social’ housing tenants to ‘borrow’, what is, taxpayers cash, to subsidise further, their basic needs. Yes, there are folk with addictions. Do we not need to have a more important debate about what kind of society we want? Should we not allow people to hit rock bottom? Sometimes that is what it takes for them to turn their life around.

      • Dr Carol, in all honesty, there are very many people who spend large chunks of their time thinking about how best to “manage money”. Adults should definitely be able to manage their own finances, but the difficulty is that (some) adults are now being ‘expected’ to perform magic miracles (as in ‘The Miracle of the Loaves and Fishes’). Not everyone has that kind of ability (some do come closer to it than others and make it appear easier, hence the many money-saving tips/low-cost meals ideas increasingly shared online and in other places. Good organisational skills (that old chestnut) as well as needing to be an excellent bean-counter are trait which many of the X million under-employed, unemployed and low-waged-but-working (potential, trainee) Managers of the Unmanageable already pride themselves on.

        In addition, worry not – “Should we not allow people to hit rock bottom?” is regularly at the top of the agenda in debates among the great & good at Tory HQ and is top of the ‘Preferred Method of Encouraging Responsible Money Management for Adults’ arm at the government’s Nudge Unit. This is very much the direction of travel for policy-making vis-a-vis social security/housing benefit payments.

        Even without being a mathematical genius, common sense still says that there are only so many ways to divide an unrealistic sum of money into an unrelated number of days and make ends meet.

      • UKIP are Fascist Bastards

        Dr Carol, I agree that managing money is not an easy skill to learn but don’t really get the other points you’re making in your post? We’re all ‘taxpayers’ in one way or another but many people simply don’t receive enough to live on and we don’t all have equal access to borrowing when we’ve run out. Isn’t is better for someone to borrow from their housing benefit in order to feed their children or buy them new shoes than from a loan shark or wonga? They’ll still have to pay it back but at least the debt doesn’t get out of control with special interest rates for the poor. I think we do need to have more debates about the kind of society we want but for me, it’s one that’s more compassionate and humane than one that allows people to ‘hit rock bottom’ in the hope they might manage to pick themselves up again. Do you think an addict has more chance of turning his/her life around with or without housing?

        • So is the money being “borrowed” for shoes or booze then because I am losing track. The way I understood Carol’s comment is that people with addictions should be allowed to hit the rock bottom. Otherwise we are just enabling them. Before you call me a Tory, please read this: http://wp.me/p3kXkS-4j

          • rock bottom for people with addictions usually means dead.

            • It certainly does for some. For others it’s enough to lose their job, partner or house to face that they are addicted and need help or to look for that help. The less you have left, the less excuses there are.

          • Either or both (shoes need replacing when they wear out; most people need them; also significant numbers of people live with the effects of alcohol-dependency). It was never known how the man who slept in a neighbour’s garage for several weeks last year reached that pass. He could have been “irresponsible”, ‘just’ had very bad luck at some time (or been the victim of injustice, needed support and didn’t find it, been through a major life-event or other circumstance). It probably wasn’t where he’d imagined spending nights on end earlier in his life. If someone, somewhere was thinking about him, wondering how/where he was, perhaps there would have been a crumb of comfort if they had known that someone had at least given him shelter and he wasn’t being exposed to the worst of the elements etc. But it’s a great big ‘at least’.

            If we choose to see creating a similar (or a worse) situation for others as a ‘reasonable’ response to their ‘unacceptable behaviours’, in the same way ‘imposing a sanction’ has at some stage become acceptable to mainstream society, (justified as ‘cruel to be kind’ and ‘helping to motivate’), wouldn’t that be crossing the Rubicon? (albeit DWP are already on the other side).

  16. Nobody has mentioned housing benefit in context to sanctions!

    • One payment.. one thing to stop… prepare for the fun and games to begin. I think they want things to kick off to bring in their draconian police state though, you can see them itching for it to happen. The Secret Courts and Secret arrest powers they are bringing in smacks of Stasi tactics.

    • Landless Peasant

      They’ve just stopped my Housing Benefit anyway, and for NO reason. I’m now in rent arrears through no fault of my own. The DWP have incorrectly informed the Housing Benefit that my claim has been closed, when it hasn’t. I haven’t even been sanctioned. The Manager of the H.B. said he thinks they do this now & then to “punish people”.

    • UC is not only paid monthly it’s also paid in arrears, so the debt trap opens up immediately.

  17. stasi or nazi tactics same difference.

  18. Paul

    Housing benefit is income based,so if you have been sanctioned you have a nil income and therefore entitled to housing benefit.. Then the fun starts when local councils withhold hb payments and housing associations and landlords threaten to evict.

    • My ESA was suspended (not sanctioned) a number of times (for various reasons – change of circumstances, failed medical followed by an appeal, etc). My housing benefit was always suspended as well so as to “prevent possible overpayment”. It remained suspended until ESA decisions were made even though the council had all the relevant documents needed to make their decision. I guess with the UC, it will remain the same – everything gets suspended. You might get a back-payment though!

    • Yip Guy Fawkes. My sis to Glasgow CC to court, took nearly 8 mths. She won!

  19. ” safely in the bank ” ?

  20. Wozzamatter?

    There is a serious shortage of social housing. What can be done about it? Build more social housing? No, that would cost too much money. I have a better idea. Why not give rent benefit directly to the claimants? That way, I estimate around 20% of them will spend the rent on other things and will fall in arrears. The councils will then evict them, therefore freeing up the properties. Hey presto, social housing shortage problem fixed!

    Paranoid? Me? Never!

  21. Iain Duncan Smith will be remembered in a small paragraph of history as the bungling, incompetent oaf who created homelessness on an unprecendented scale and increased crime and social problems to record levels. Nice one Smithy.

  22. workshy

    You are missing the point even if housing benefit suspended, you still entitled to it even if they refuse to re-instate benefits because you had nil income at the time so were therefore entitled to housing benefit.

    • fawkes..one has to answer in reems of finical disclosure..to PROVE one is in need of hb and ct benefits…after bens are stopped…questions like…after this date…explain your daily outgoings…ie explain how you manage without an income!

  23. can’t wait for it to come in, it’ll clear my rent arrears overnight, and it’ll take them a lifetime to get my council tax off me….

  24. I’m sure you will be very happy wizzing wizofwoz.

  25. You mean NOT able to have their rent sent directly to Landlord.

  26. OK… I see what you mean there. Sorry.

  27. Anomie shrugs

    Conditionality – setting the agenda for mass evictions – bedroom tax, direct rent payments and precarious JSA eligibility all designed to create a transient cohort.

    The ruling class have signed on to that conditionality agenda the debate should now revolve around the consequences of welfare reform.

  28. so…min wage is poverty level income…therefore benefit relief income is at extreme poverty level..and on top of this our income spend choices are being squeezed..even harder by uc…and now, housing payments made directly to tenant…to help me manage my finances better…!

    anyone who survives on £71/wk…is a supreme being of financial management, already…in my view…

    this to me leads to another valid point…mp’s et al are also all arguing that they could live on less..as they are supreme beings of financial management.. and i am not,”all in it together..” this must be at true reckoned pro-rata levels/rates..volunteer to do so!

    they should therefore live by example…and drastically cut their own incomes..and expenses….i will give them the opportunity to show me how it is done….

    i also wonder what the combine catering costs are for the echelons of public bodies….?
    actions are always speaking louder than words….come on mp’s…show me how it is done!

    ps…one cannot owe oneself vitals…vitals have to be continuously maintained…or one goes into survival mode…

    after all reward comes from serving…parliment who do you serve now….? . or is it do as we say, and not as we do?

  29. Anomie shrugs

    @overburdenddonkey,

    You have to budget your vitals nudge, nudge, wink, wink!

  30. The “nudge” unit now becomes the “boot” unit.

  31. Anomie shrugs

    So who funds (or has been funding) this psych ops nudge unit?

  32. Murray

    by the time the private sector have taken their salaries the tax payer will be putting money in to keep it going – nil profits.

  33. Obi Wan Kenobi

    Off Topic – But still IDS:

    How the welfare secretary got a ticket to free-ride.

    Iain Duncan Smith joins the prawn cocktail set at White Hart Lane.

    One assumes Iain Duncan Smith, the work and pensions secretary, enjoyed the £2,400 worth of hospitality that he and his son received as guests in the directors’ box at Tottenham Hotspurs’ game with Arsenal on 3 March. But the gesture went down less well outside the ground.

    http://www.guardian.co.uk/politics/2013/apr/30/hugh-muir-diary-duncan-smith-spurs

  34. Hi all,

    I am a Private Sector tenant on the JSA and in a difficult/strange situation – I had low income and was receiving through direct payments: £110 per month of Housing Benefits .

    I lost my job and I requested full housing benefits. They were awarded to me and since I was over 2 months in rent arrears, were to be paid to my landlord.

    I went to the Council and gave the HB adviser my landlord’s banking details that she entered in the system right in front of my face. I asked for written confirmation and was given a confirmation the arrears were to be paid to my landlord. Additionally,my landlord and I received a letter from HB confirming change of payee – direct payments to be paid to my landlord and giving a date for the payments to be received.

    Well, the first payment installment was sent directly to my account – I have been an honest and hardworking person all my life – but I’m in such debt that I used the money to keep bailiffs away in my country of origin and pay off urgent debt – I am in Council Tax arrears and have to pay over £100 on the JSA – I have been living on my bank overdraft for a year £1500 overdrafted – Now my landlord is chasing his money and constantly asking for his payments.

    I am looking for a job and keep hoping I will get something soon!

    My question is: what are my options legally? Can they cut off all benefits, even though they made a mistake and sent out written confirmation for the payments to go directly to my landlord?

    Anyone has been in that situation?

    I’m thinking about giving my 2 months notice to my landlord and get out of this country altogether, though the U.K is the only place where I have a bank account and a vague chance to get a job.

    What do you guys think?

    • Landless Peasant

      Perhaps you could get a Budgeting Loan from DWP, if there is still such a thing? Then use it to pay what you owe to your Landlord, but don’t say that’s what you need a loan for, say it is for a new bed, or a cooker or something. If you get a Budgeting Loan it will be deducted in increments from your JSA.

      As for the Bank overdraft, if you cannot afford to pay it off then don’t. I’m still paying off a Bank overdraft from 13 years ago, at £2.00 per month, but at least the interest is frozen.

      As for leaving the UK, I wouldn’t blame you if you have somewhere to go. I’d go too if I had any money or a place to stay (or even a Passport!).

    • UKIP are Fascist Bastards

      Indebted, not sure what you mean when you ask if they “can cut off all benefits”. You’ll continue getting your benefits but even then, it sounds as if you don’t know how you’re going to pay off your rent arrears since you have too much going out. If your landlord wants to evict you because of the arrears, he’ll have to apply to a court for a judge to decide and that will take time. You could argue then that the reason you’re in arrears is because of the mistake by Housing Benefit and show proof. But there’s a good chance you’ll be held responsible for spending the rent money on other debts. You’re only defence could be that you actually spent it without realising – that is, you were expecting your HB to go to your landlord so you thought the money in your account was yours. Best thing to do first though is try to negotiate a re-payment plan with your landlord based on an affordable amount and taking account of your other debts. Google NationalDebtLine and give them a call for help with this. Also google phone number for ‘Shelter’. It can be hard to get through but they can tell you much more about housing law.

  35. Obi Wan Kenobi

    The fake jobseekers’ questionnaire reveals a new kind of nanny state.

    This bogus test is a blatant attempt to ‘shape’ people and makes a mockery of Tory indictments of government bossiness.

    A questionnaire filled out by jobseekers at the behest of the government has been shown to be “fake”. It supposedly tested one’s strengths, but the results were the same regardless of the answers submitted. Since jobseekers were told to fill it in on pain of losing benefits, they are quite angry about the dupe. But why were they conned?

    http://www.guardian.co.uk/commentisfree/2013/may/01/fake-jobseekers-questionnaire-new-nanny-state

    • Landless Peasant

      Everyone feel free to contact the Tories and ask them what they’re playing at:

      http://www.conservatives.com/Information/Contact_Us.aspx

    • Obi… Its all about the feel good factor,the results were meant to make the skiver feel better about himself,thereby make him go out immediatly and get a job,because all employers are screaming out for feel good employees,and want to give him a job,so he can make a happy contribution to society. So the time spent being duped was not entirely wasted.

    • Cos the numpties at the DWP have more money than sense, & would rather waste it on garbage like their fake personality test, than actually iuse it for , um, let’s say, job creation…

  36. Update: My landlord just confirmed he received partial payment of the rent arrears into his account and asked me to chase with the Council.

    I owe as of today, £1542 of which I received £ 1150. I take responsibility for the way I handled the money but still think I’ll get a job soon and will be able to clear my debt.

  37. Indebted

    If you spent the rent that was supposed to be paid to your landlord then you are liable to pay this amount to your landlord, but this should not affect you receiving benefits once they have sorted out that further rent payments have to go to your landlord, not you.

    Perhaps you could sue the dwp for getting you into debt by sending you the rent payments after they had put it in writing that hb would be paid to your landlord?

    Such a precedent could be copied when uc comes in by those who would rather their rent go straight to landlord.

  38. obi wan…a con is a psychological mechanism designed and intended stretch one’s attention as far away from the truth as possible….an almost feasible lie… scattered with grains of truth…

    say if ids presents an anonymous cv to an employer would he stand a chance of getting a job..? ask him!

  39. United StereoTypes of Unemployment (U.S.T.U.)

    08456088501 is the number for Canterbury BDC, all benefit enquiries for the South East.

    The options have changed since the last time I rang it. Option #2 “to inform us of a death..”

    Is this the 2nd most popular option then?

    • something survived...

      It would be the first if more of us rang up to announce a death in advance. Not ours – that of IDS.

  40. IDS has already stated that he does’nt understand why people gamble instead of being greasy pole climbers like himself. Hope seems to be a concept that is beyond him because he is incredibly wealthy anyway.

  41. I like to add that perhaps he is trying indirect euthanasia tactics to kill off those who cant manage their funds or have access to creative accountants so depleting the surplace population like any self righteous nazi would do instead of helping them.

    • All Facist parties have come to power historicaly, when their countries have been in deep ressession,such as we are now,note the rise in support for ukip.

  42. IDS wouldn’t care, he wouldn’t be around to face any Nuremburg type trials.

    • Gone are the days when you could march off to war,all the undesirables of society,thereby reducing the unwanted population by some millions…

  43. i can only dream of a mass civil rights movement!

  44. frank begbie

    So why did the government introduce direct payments to landlords in the first place?
    So that people wouldn’t get into arrears with their rent payments.
    And now they want to go back to the old system.
    So whats the REAL reason for doing this?
    Obviously its all about freeing up houses.

  45. Can’t help thinking of a friend of mine, who of course lives in the real world. Working part-time she is paid weekly. She pays her portion of the rent monthly. The housing benefit is paid every 4 weeks, and the Housing Association charges her rent weekly. She manages ok, but sometimes struggles to remember the difference between monthly payments and 4 weekly payments. Just a thought, but has anyone thought of asking (social) landlords to charge rent on a per month basis?

  46. To enlighten some of you on here not all residents receive rent payments direct as most of councils & HA’s insist on rents are paid to them direct, as we have had ours always paid direct to them and I’m not happy too pay out of my universal credit as you are have to pay your rent through the internet & not direct or by D/D to your landlords? all other bills are to be considered are less important and not their concern? If you run short of money the Government are saying use payday loans / wronga / credit unions, so one ends up deeper in debt and no way out? and its a yes to franks begbie’s comment it is to free up houses?

  47. This will drive up rents as Social housing landlords seek to recoup rents not paid, and the cost of evictions. The lack of joined up thinking from IDS and this present government is staggering. What time is the bloody revolution, because I don’t want to miss it.

  48. I don’t want my rent paid to me! Not because I lack financial ability I managed perfectly well when I was we’ll enough to work. But in the last year I’ve had 1x3m and 1x4month slots where housing benefit has been suspended/delayed for no particular reason and was later sorted.

    However if I have to set up a direct debit to housing association it would still be coming out and I would be the one stuck with fines and charges as well as nothing to live on since if universal credit is delayed then that’s all your income..

    Dont really want to be checking the exact date to make sure the money’s gone in and out so I can spend what left.

    • This universal credit policy has never been thought about,by anyone who does not have money available to them,obviously if anyone who was familiar with the plight of the poor, things would be entirely different. and this policy would never had seen the light of day…

  49. what is the actual point of paying claimants the rent money and not the landlords. i always thought it went directly to the landlord to avoid misuse or fraud. is there a logical reason for the change?

  50. Everything that is happening is part of a much larger picture. This was obvious when the Squatting rights where abolished just before the change of the system. My view is, its to free up housing to give housing to other people from other countries. I think the government have given up on its residence and just wants to build a country on New beliefs with fresh minds that they have gained by showering them with a better quality of living and that’s the key. What we have here is still much better standards than many countries and that’s how the Government will rise. That way they have the new society built with new people who will continue to vote them in. We have very little money in this country…. Why would MPs be going abroad encouraging families to send their children to school here? Why would any government want to blow out the Hull of an already sinking ship? So they can build another. The more people that enter the country the more diluted the voting will be and that’s all part of the plan and as long as there is mass immigration from poverty elsewhere the Government wont be changing at all.

    • Foreigners cannot vote in the general election and EU nationals can only take part in local elections. Considering the new Immigration Bill (including immigrants being pushed to the bottom of social housing lists, lack of access to benefits and having to pay for healthcare), I don’t think the government is particularly keen on immigrants.

      When it comes to the sinking ship – they don’t really care because they won’t sink with the rest of us. They won’t even get wet.

  51. Financial scenario has been damaged due to recession which hit upon everyone unknowingly. Not only people but also financial institutions big or small have been collapsed due to the unexpected recession.

  52. They don’t pay your full rent say ur rent 400 they will only give you 265 so it going to be people homeless any way should just stick with the old system

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