07 November 2003
A housing association that tested a new way of paying benefit is pleading with the government not to end direct payments to landlords overnight.
The Department for Work and Pensions is proposing to start paying housing benefit to tenants instead of directly to registered social landlords. A major pilot is due to start in Blackpool later this month.
But London and Quadrant Housing Trust, which began a similar scheme with selected tenants last year, says the effect of an across-the-board switch would be disastrous and lead to some associations turning away tenants in receipt of benefit or leaving the sector completely.
In Croydon, rent arrears rose from 3.9% to 7.5%, while the average sum owed by tenants rose from £250 to £450. After initially promising not to punish tenants who were in arrears because of the change, London and Quadrant was forced to get tough and evict four families.
Problems arose because banks refused to offer some tenants accounts with direct debit facilities. The performance of local authority housing benefit departments was also patchy.
'Clearly the picture is not a good one,' said Mike Donaldson, L&Q's director of corporate strategy. 'The only way that a landlord can get the money back is through eviction and that's not going to help anybody.'
L&Q, which offered to pilot the new system for the DWP, said landlords should choose which tenants are placed in charge of their own benefit. 'Landlords should have more say on who gets rent and who does not,' added Donaldson. 'So far, that's fallen on deaf ears at the DWP.'
PFnov2003
