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Raising the bar for the poorest in housing need

17/9/2016

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As landlords batten down the hatches as Universal Credit rolls out, rent decreases are imposed and benefit caps are introduced, accessing social housing has become harder than ever for people struggling to make ends meet. Is the government finally taking note?
 
“It’s getting to the point where we have to ask a simple question: If a social landlord won’t house people because they’re poor and struggle to make ends meet, who the hell will?” In his latest blog, Quids in! editor Jeff Mitchell this month claims the only difference between applying for social housing and taking a driving test is that someone is more likely to successfully get the keys to a car than a new home.
 
“Housing Associations have been backed into a corner by the government. These organisations have to survive but if someone doesn’t start shouting out for tenants, we’re heading back to the days of Cathy Come Home,” he adds.
 
Benefit caps, direct payments and government-imposed rent cuts have caused many housing associations to start vetting new tenants based on their ability to manage their money. As Universal Credit (UC) is rolled out, the bar will rise much further, not least because in pilots 79% of claimants were in rent arrears by the time their first benefit payment arrived, according to the National Federation of ALMOs (NFA) and the Association of Retained Council Housing (ARCH). Other research found direct payments, where the housing element of UC is paid to the tenant instead of the landlord, were unmanageable by many claimants.
 
Describing levels of debt as a “frightening fact”, welfare reform minister, Lord Freud, has ordered an enquiry into why so many tenants are falling into arrears when moving to UC. “We need to understand what the existing arrears are. They are much higher than we expected,” he said.
 
In July Inside Housing reported that Labour peer Baron William McKenzie of Luton said the roll-out of UC was “causing a build-up of debt among social tenants, creating financial hardship and reportedly driving some into the arms of loan sharks”.
 
“Our mind-sets have changed as we look toward a future where ‘guaranteed’ payment of our rent from most households becomes a thing of the past,” one housing worker in London told QIPN. “We are routinely vetting nominations for our properties in order to gain a clear insight into the household’s financial position. In short, we are ‘filtering out’ those whom we feel would be severely challenged to pay rent.”
 
Increasingly, this is the picture across the country with pre-assessment matched with support and advice. In Bath, Curo Housing runs a Passport to Housing scheme that it describes as “a free and confidential service offered by Curo to help people bidding for homes to prepare for a successful tenancy and plan for the expense of moving home”. It works with Citizens Advice locally to develop money management skills and ensure prospective tenants are on top of any debts, have an appropriate bank account and can manage a budget.
 
According to the Joseph Rowntree Trust, however, while social landlords are offering support and advice, many are also screening out any they don’t think will be able to stay on top of their money: “Housing associations are intensifying scrutiny of new applicants for new ‘affordable’ tenancies to ensure they can pay higher rents and service charges. Some of the poorest applicants (whether in work or not) are being rejected and screened out and advised to apply for cheaper homes,” its briefing paper The Impact of Welfare Reform on Social Landlords and Tenants reported.
 
It concludes: “The financial pressures on social landlords arising from welfare reform are raising doubts over their future development plans. Social landlords are trying to reconcile not only their financial viability with their commitment to house low-income tenants, but also their landlord responsibility towards existing tenants with their aim to provide more housing for those in need, particularly vulnerable groups and individuals. Housing associations have made far-reaching changes to prepare for welfare reform, but the challenges are immense and it is unclear what lies ahead.”
 
Jeff Mitchell comments: “Social landlords have been our best friends at Quids in! so I don’t believe it’s their choice to turn their backs on the founding principles of social housing that it should provide a safety net for all those in serious housing need.
 
“For some, though, it’s worth pointing out that much of their stock was originally publicly owned and I suspect there would be a public outcry if they knew the most needy were being screened out. In turn, landlords should take this back to government. It is not inconceivable that claiming Universal Credit could become a mark against a new tenant in its own right.”


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