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Landlords increasingly avoiding renters claiming Universal Credit, says MP

As the government once again delays the roll-out of its flagship welfare reform, worrying signs of problems within the rental market are emerging.

Nigel Lewis

As leaked government documents show the roll out of Universal Credit is to be delayed again, Liverpool MP Louise Ellman yesterday told the House of Commons during a key debate on the welfare reform that landlords in her constituency are increasingly reluctant to rent their homes to those claiming it “because they are concerned about mounting arrears and failure to pay”.

Also, Labour MP Stephen Timms asked the Secretary of State for Work and Pensions Esther McVey whether she would address the problems highlighted by recent research from the Residential Landlords Association revealing that a majority of its members are now not willing to let accommodation to Universal Credit payments.

“As the right hon. Gentleman will know, we have made various changes to make sure that we can pay direct to the landlords—that we can give alternative payments. It is only right that we do that,” she said.

Universal Credit rollout

Louise Ellman, who is MP for Liverpool Riverside, said her constituency is one of the areas where the government is rolling out Universal Credit and that 2,000 people had been transferred to it locally so far, with another 13,300 to go. Her constituency has an electorate of 73,406.

Commenting on Universal Credit, Ellman said: “The Government must stop pretending that all is well. They must halt this roll-out. There must be full disclosure of what is really happening.”

The Government must act now, Ellman said.

During the Commons debate Labour MP Jim Cunningham said Universal Credit had caused an increase in rent arrears created largely by the five-week gap between claim and payment.

Those who fall into rent arrears while they wait for their first Universal Credit payment are paid advances, said Labour MP and shadow Secretary of State for Work and Pensions Margaret Greenwood, but explained how they must be paid back and are treated as ‘loans’.

“The maximum percentage that can be taken out of universal credit for repayments is 40%,” she said. “How is someone already trying to manage on such low income supposed to cope when such a large slice of their support is taken away at the source?”.

October 19, 2018

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