The UK Government has outlined a number of changes it wants to make to the welfare system. It proposes to introduce the changes through the Welfare Reform Bill currently going through Parliament at Westminster. These changes have significant implications for tenants and social landlords. If you rely on Housing Benefit to help you pay your rent, you need to be aware of a number of changes which are being made to:
· How your Housing Benefit payments will be made
· The amount of Housing Benefit you might be entitled to in future
The changes to Housing Benefit will not happen all at once; they are being phased in over the next few years. The Scottish Federation of Housing Associations is working closely with other like-minded lobbying groups to fight for some of these changes to be dropped before the Welfare Reform Bill becomes law.
What is changing?
All working age benefits will be replaced with a Universal Credit, with a cap of £350 a week for single people and £500 a week for couples on the total household benefit a household can receive.
Your Housing Benefit will be rolled up into the Universal Credit, which you will receive as a monthly lump sum, in arrears.
96% of tenants currently choose to have their Housing Benefit paid directly to their landlord. Under the Universal Credit, they will no longer have that choice and will have to manage their rent money themselves.
A Housing Benefit cap will be introduced on social rented homes which are defined as being ‘underoccupied’ – i.e. where there are more bedrooms than that size of household is deemed to require
Increased Housing Benefit deductions will be made for claimants who have non-dependents (grown up relatives or lodgers) living with them
There will be changes to Working Tax Credit (including a drop in help with childcare costs)
People in receipt of Incapacity Benefit and Severe Disablement Allowances will face reassessment
Disability Living Allowance will be replaced by Personal Independence Payments.
Council Tax Benefit may be abolished, to be replaced with some other (as yet to be determined) local form of support, while elements of the discretionary Social Fund (Community Care Grants and Crisis Loans for living expenses) will also be replaced by (as yet to be determined) local support.
How will this affect tenants?
The benefit reforms will hit some of the poorest and most vulnerable people in our society the hardest.
An estimated 1 in 5 tenants will see their incomes reduce when the new Universal Credit is introduced - in some cases, tenants may see very significant reductions in income.
Rates of non-dependent deductions have already been increased significantly from April 2011 meaning that a household with a non-dependent on the minimum wage for a 40 hour week will lose £48.45 a week in Housing Benefit. That’s £10.25 a week more than compared to 2010-11 rates. An estimated 5,590 tenants in Scotland may be affected by this measure.
A third of working age tenants underoccupy their tenancies by at least one bedroom – these households stand to lose an average £11 a week in Housing Benefit. The proposed change will affect between 31,500 and 42,900 social housing tenants in Scotland who are of working-age and claim Housing Benefit. These measures are likely to cost housing association and housing cooperative tenants in Scotland between £18million and £24.5million over a year.
Universal Credit will set a cap on benefits to working age households, which will affect an estimated 1,700 housing association tenants across Scotland, who will see their weekly incomes slashed in the order of between £66 and £93 a week.
What can I do about it?
The SFHA is currently fighting for changes to be made to the Welfare Reform Bill.
As your landlord, Albyn is concerned about these changes, and we have signed up to the SFHA’s Housing Benefits campaign.
We would encourage you to do the same – you can register your support either online at www.sfha.co.uk or by coming into the office and signing the petition.
