DWP pilots scheme to recoup universal credit arrears

Government officials are trialling a scheme to make it easier for landlords to recoup universal credit rent arrears by scrapping requirements to post letters.

The trial, which started last month, is being conducted by a number of social landlords including Golden Gates Housing Trust and the Department for Work and Pensions (DWP).

Under Iain Duncan Smith’s universal credit, which combines six benefits into one, tenants are paid their benefit for housing costs directly instead of to their landlord. Landlords have expressed concern that some tenants will be unable to manage their money and will fail to pay their rent.

If a tenant is in two months of arrears, their landlord can apply to have the rent payment switched back to them under an ‘alternative payment arrangement’ (APA).

However, until now, landlords have only been able to do this by sending a letter through the postal system. Housing associations have complained that this system is cumbersome and slow.

Under the pilot, landlords are able to send their APA requests through a secure email system. They still receive notice of rental payment from the DWP through the post.

Carmel Morris, senior financial inclusion officer at Golden Gates Housing Trust, said the initial results of the pilot were promising but that the DWP still had ‘a way to go’ on improving the administration of universal credit.

The pilot is the latest move by the DWP to make it easier for landlords to secure APAs. Last weekInside Housing revealed that First Choice Homes Oldham has begun trialling a government-backed scheme under which ‘trusted’ landlords will be able to secure APAs automatically without having to submit an application to the DWP. However, the DWP can withdraw ‘trusted partner’ status if it deems a landlord is putting a large number of tenants on APAs to secure its income.

In February, Inside Housing revealed that social landlords were experiencing long delays recouping rent payments from the DWP after applying for APAs.

The DWP declined to comment.

The above article was written by Heather Spurr for Inside Housing.

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