Fears grow over impact of Universal Credit rollout

More than 5,000 families in Enfield are now claiming the controversial all-in-one benefits payment, reports Stephen Cox

Universal Credit poster

Government posters promoting the rollout of Universal Credit have been popping up around Enfield in recent weeks

The introduction of Universal Credit (UC) in Enfield may make it more difficult for claimants to find private rented accommodation, landlords and voluntary organisations have warned.

UC replaces housing benefit, working tax credit, and a variety of other benefits, with a single monthly payment. Because UC is being paid directly to claimants, it means landlords are not guaranteed prompt payment of rent, and the system’s growing reputation for causing delays to benefit payments is increasing wariness about renting to claimants.

The first claimants from Enfield were transferred to UC last year and since then 5,168 households, as of October 2018, have been moved to the new system – around one-in-seven of the total number eligible.

Chris Norris, director of policy and practice at the National Landlords Association (NLA), said: “The private-rented sector plays a key role in providing much needed affordable accommodation to tenants on low incomes, including those in receipt of housing support. Currently, only 19 percent of landlords in outer London let to those receiving any form of housing benefit.

“While the NLA supports the concept behind Universal Credit, it is clearly divorced from the realities of many tenants’ lives. Many landlords now view letting to tenants in receipt of housing benefits as high risk, because they simply do not have the confidence that rent will be paid to them on time.”

UC is increasingly controversial, with the Secretary of State for Work and Pensions, Esther McVey, last month admitting that families could be made up to £2,400 worse off each year.

Local voluntary groups in Enfield have echoed these concerns, with Enfield Citizens Advice Bureau (CAB) reporting that 740 local families have sought help from them.

Jill Harrison, chief executive of Enfield CAB, told the Dispatch: “Housing is expensive. I understand the argument that helping claimants to budget is a good thing, but many landlords are already reluctant to rent to people on benefits.

“Fears they might not be paid might lead to some landlords refusing claimants as tenants. After all, if your kids are hungry, you would be tempted to put them first.”

UC already applies to most new claimants and is being gradually rolled out to existing claimants. The benefit is paid monthly in arrears, and there is a five-week gap between the end of the old benefit and the start of the new. New claimants can apply for an advance, but this is a loan which must be repaid within the year.

Jill said: “Many clients are in irregular, minimum wage, zero hours contract work. They’re not likely to have savings to tide them over. Any loan is a bad idea.”

She thinks it is inevitable that there will be many struggling to cope in the transition. “Making everything online sounds good. But people may not have good English. A lot of our clients just need help understanding how to answer the questions or prove identity.”

A recent report in The Observer said that almost two-in-five households in receipt of benefits lose an average of £52 a week switching to UC. The Trussell Trust, a national foodbank charity, claims foodbank usage has risen by half in boroughs where UC has been rolled out. North Enfield Foodbank was asked for figures for this article but stated that it doesn’t record which clients seeking emergency help do so because of UC.

A spokesperson for the Department of Work and Pensions said: “UC replaces an out-of-date, complex benefits system with cliff edges that disincentivised work and often trapped people in unemployment.

Under UC, evidence shows people are moving into work faster and staying in work longer than under the old system.

We have made improvements, including increasing advances to 100 percent, removing the seven-day waiting period, and paying people’s housing benefit for two weeks while they wait for the first UC payment.”