New DWP proposal will trap people in their homes, and in debt

New DWP proposals to protect landlords’ rental incomes are in danger of trapping people in their homes, creating a modern day version of a debtor’s prison.  

Last year Lord Freud committed to protecting landlords’ rental incomes under Universal Credit.  To do this, DWP propose that tenants in rent arrears have 40% of their core benefits deducted until rent arrears are cleared – that’s 40% taken from JSA, Income Support or  Standard Allowance under Universal Credit.

DWP have not put forward a rationale for the 40% rate.

But the 40% rate should definitely ring a bell, because it’s the same punishing rate people are sanctioned by if Jobcentre Plus decide they aren’t trying hard enough to get a job. So is it the case that people in rent arrears simply aren’t trying hard enough to pay their rent?

Housing benefit claimants hit by the bedroom tax are expected to make up the shortfall from other income, but with JSA just £72 a week for a single claimant, this is a genuine struggle.  Half of those hit by the bedroom tax are now in rent arrears.

People also move into arrears because of the welfare system’s inefficiency - many of the rent arrears cases Shelter see at the court desks are caused by housing benefit delays.

The proposed debt rules will take no account of household circumstance, which is risky both for the household and the landlord.

Read more...