DWP make major Universal Credit update as Liz | European Markets

The Division for Work and Pensions (DWP) has delivered a essential replace to Common Credit score claimants who’re additionally renters, saying that it’ll review the present system which allows landlords to mechanically declare a portion of tenants’ advantages for rent arrears.

The choice to scrutinise the protocol follows a important Excessive Courtroom verdict final month that slammed the prevailing setup as “unfair” and “unlawful.”

At current, an automated process greenlights requests from landlords to subtract up to twenty% of a claimant’s month-to-month Common Credit score payout to settle excellent rent with none session involving the tenant or the DWP—a coverage that has sparked fears of deepening poverty among the many most weak by accruiting extra debt.

This automated deduction strategy was challenged in court docket by Nathan Roberts, a Common Credit score recipient and law graduate.

Roberts confronted over £500 being snipped from his benefit by his landlord for alleged rent arrears during a period when he contended along with his landlord over purported uncared for repairs.

Nathan was beforehand receiving £1,218 month-to-month from Common Credit score, which included a commonplace allowance of £364.74, a £459.64 housing part for rental prices, and a £390.06 incapacity top-up resulting from his disabilities. Nevertheless, the DWP knowledgeable him that he would no longer obtain his housing part, and an extra deduction of £44.74 can be made to clear supposed rental arrears.

Though claimants can problem such selections, it entails a prolonged inner course of, probably leaving them unable to reverse the deductions for a number of months.

Nathan contended that the DWP had permitted the deduction with out consulting him on its influence and didn’t notify him concerning the deduction utility initially, experiences the Mirror.

He additionally maintained that he had no arrears and was in a “genuine rent dispute” along with his landlord over the property’s habitability. Throughout the listening to, the decide famous that in disputes over repairs, withholding rent is perhaps the tenant’s “only leverage which a tenant has,” and DWP decision-makers might inadvertently undermine the tenant’s protections.

He emphasised the “real-world impacts” on tenants who, even after efficiently difficult the choice by way of prolonged inner DWP appeal processes, couldn’t reverse the deductions for months, leaving them on decreased advantages. The Work and Pensions Secretary confirmed this week that the DWP wouldn’t contest the court docket’s resolution.

The federal government division is set to scrutinise the present process and discover more equitable strategies to make sure that landlords are paid their due rent, while additionally safeguarding housing benefit recipients from sinking into debt. This initiative arrives amid the DWP’s efforts to “fix the broken welfare system to make it fairer and ensure it improves living standards which will unlock economic growth”.

On Tuesday, Work and Pensions Secretary Liz Kendall emphasised the division’s dedication to correcting enduring points within the advantages infrastructure. She asserted: “The automatic approval of landlords’ requests for tenants’ benefits to be deducted is one of these.”

Kendall continued her stance on reform: “As well as urgently reviewing this system, I am bringing forward major changes to the health and disability benefits system so that it works for everyone, underpinned by the biggest employment reforms in a generation. We will continue to listen to people’s concerns, and transform our benefits system to one of fairness, not punishment.”

Sir Stephen Timms MP, the Minister for Social Safety and Incapacity, additional remarked on the need for overhaul: “The benefits system needs urgent reform and we are taking action across the board to do this – whether that’s tackling the huge accumulation of debt by Carer’s Allowance recipients through no fault of their own, or this automatic deduction of benefits purely at the request of a landlord.

“Mixed with our efforts to Get Britain Working and our upcoming health and incapacity advantages reform, all of this may result in higher assist for many who need it, and open doorways for many who can work.”