Universal Credit. 20-30% don't pay the rent.

[CogitoErgoSometimes]

Article

Anyone pick up on this story? As part of the move to Universal Credit where claimants are given a sum of money each month and expected to manage it, a pilot study showed that about 20 - 30% of recipients failed to pay the rent on time. Given cash rather than the money going directly to the landlord, a surprising number defaulted on the rent. Extrapolated up a 20 -30% failure rate would be disastrous and plans are having to be drawn on how to support people in running household budgets and setting priorities.

I'm largely a supporter of UC as I think the current system is over-complex. I also realise that money-management doesn't come naturally to many. But if such a large percentage of people would struggle to manage a monthly benefit income this way, how would they make the transition to paid employment?

[Fifis25StottieCakes]

93% of new housing benefit claimants are in work, if they move they will loose their jobs if they cant afford to pay the transport to get there or cant find a new job in the lower rent area. Some claimants have already been moved out and guess what the towns they have moved to don't want 'undesirables' there and are moaning about the lack of housing.

[Leithlurker]

Ok Xenia lets have a flat tax of 45%. I trust you will have no problem with that

[Leithlurker]

Also as Fifi has said a large number of those on cb and hb will be working, so if they are not to be susidised by tax payers who will do their jobs?

[Fifis25StottieCakes]

That's the problem Leithlurker, the way they have done the reform is unfair as it covers such a wide variety of people. If your in work in a high rent area and claim HB to top up your rent your stuffed. Simple fact it the housing was sold and not replaced. RTB landlords have snapped up a lot of the local authority housing so you end up paying double what the council tenant next door pays. Great if your lucky enough to have a council house, not so great if your in a private

[Leithlurker]

I agree fifi, the outrage about people living in overcrowded and bad housing will soon drown out all this crap we have about hb. Who will the cost fall on to fix these new slums, why the tax payer of course. Thanks maggie say the rich.

[Xenia2012]

I imagine it is rather left wing but the BBC radio special this week - The State of Welfare is probably worth listening to

www.bbc.co.uk/iplayer/episode/b01p0fpg/The_State_of_Welfare/

[Wallison]

Lots of good points here. I would only add that isn't the £1.2bn figure fraud and error?

And the housing benefit bill is actually more than £20bn, every year. That's what it is costing us to house the poor including the working poor, because council houses have been sold off and the people who would previously have been in them are now renting privately - in some cases as Fifis said renting the exact same house that they could have got a proper secure council tenancy for, except that now they owe double what the rent would be, which they claim in HB which then goes to the landlord to pay for his investment. It's crackers.

[Fifis25StottieCakes]

I think some figures i read this week said housing benefit is 20bn. The majority of the welfare bill is pensions followed by HB. The actual amount going to claimants is not that much of the whole welfare bill.

I read an interesting article regarding the under 25 welfare bill, i will see if i can dig it out. Off the top of my head HB going to the council was 730m and housing benefit going to private landlords was in the billions. The HB which goes to the council is sort of recycled once the costs are taken out for running the properties where as the majority of the money was going to private landlords and not back into the system.

[MiniTheMinx]

Said like that Wallison it sounds like private land lords are stitching up the tax payer.

[Fifis25StottieCakes]

Yes the 1.2bn will be error as well

[MiniTheMinx]

Fifi, are social LL classed as private or the same as Council ? money that goes to social LL wouldn't be recycled would it?

I read somewhere that a freedom of information request has repeatedly been turned down, in relation to the accounts of the largest social housing LLs. It is proposed that social LL have huge black holes in their balance sheets. Many councils sold their housing stock at silly prices. In Mid Sussex they sold to (I think it was downland, could have been more than one) downland housing for less than £5,000 per house. Begs the question why are social LL in debt?

[Fifis25StottieCakes]

Im not sure where the money from social LL's go, you mean like housing associations. I would imagine it just goes into their accounts unlike the council. Yes there are houses next to me which went for 8,000. My mam bought hers in the 90's for 14,000 kept it the 3 years and sold it for 112,000. she then moved to a private estate. The house is in the next street to me. Someone bought it and it got repossessed. I seen one of the BTL LL's boards go up and had a dig about. It sold at auction for 72,000 and was up for rent for 600pcm. Mines the same house off the council and my rent's 360 pcm. There's loads of ex council houses on my estate bought up between 2 BTL LL's, they must wait for the auctions. Not sure where the 18bn from RTB went but it doesn't seem to have gone into replenishing the housing stock.

[JakeBullet]

What if you were housed in a crappy part of London (or wherever) and built up family and support networks there? Then say that area suddenly becomes the new and trendy place to live so house prices rocket?

Just making the point here that many of those renting and claiming HB in expensive areas might not have said "ooh that's a trendy and expensive part of London; I'll live there and top up my rent with HB".

Chances are they have been there for years.

I am not in an expensive area but I am a Carer with a disabled child who has family support locally. If I was in an expensive area in the same circumstances I would be well hacked off with people looking down their noses and judging me for daring to live near my support network.

Just saying.

[Wallison]

That's a good point, JakeBullet. Time was when nobody wanted to live in Soho or Notting Hill or any number of places where house prices are now sky-high. Why should someone who works nearby, whose kids go to school there, who has friends and neighbours around them, have to move just because people like Xenia think they're not worthy of their postcode?

[Fifis25StottieCakes]

The 2 cheap flats i was looking at were £250 pw in a council tower block. Do a property search for London, the rents are huge. Think i searched in google ex local authority flat london. They are not in nice areas they are like that all over. So a family of 4 gets £252 pw in benefits to live on, any property over £250pw will take you over the £500 cap. I don't think they will be able to move everyone in London out, it's not possible when you consider i found 2 flats on 2 searches for £250 pw. People are going to end up in massive arrears/homeless and private LL's wont touch HB claimants for this reason

[Fifis25StottieCakes]

Not to mention the people in the areas they are moving them out to, people have already been moved out as far as Manchester. It will create an affordable housing shortage in these areas. There was a man and his wife had a nervous breakdown. SS ended up at his door and he took the 4 kids back, they rehoused him to a bigger property as they said he would be overcrowded where he was He's now been moved miles away to a town outside of London away from his support network

[Xenia2012]

The R4 programme which I have listened to part of, says Beveridge set up the welfare state on the basis you took out what you paid in but there was a very minimal safety net. Also at the time most men died at or before retirement and yet we have not adapted the system to take account of men living to 75.

They compare a hard working man who is out of work with 4 children now and gets about £1650 a month including housing benefit. He would have about half as much in 1942 but a lot of things people now think are essential were not in those days.

What is this "support network" which people seem to need. No one has given me a support network. Most of us work and keep ourselves. We dont' have acres of unemployed local relatives to cook our dinners or look after our children or hold us when we cry.

[Wallison]

Xenia, somehow it doesn't surprise me that you don't have any friends, but for most of us these things are important.

[Fifis25StottieCakes]

He worked Xenia, he lost his job and his support network i.e friends and family and has 4 young girls to look after. If you cant see anything wrong with that then im speechless

[Leithlurker]

So you had no help Xenia and that's all the justification you need for saying others should not Ooookkkkaaayyy.

However you make a bad fist of making a good point, and that is that the welfare system, and please not welfare is not benefits. It is housing, NHS, Education, and Housing. The pillars of security as he called them, has stayed in the same moral and attitudunal focus as when they were written in the 1940's. This is why disabled people are being assessed for work that they cannot do that they will never get even if the work was their. It is why we get the attitude often seen here that the poor should be grateful for their poverty and be accepting that everyone else should get to dictate what they buy, where they buy it from, and what kind of lifestyles they should lead. It also allows people to say things like drug addicts should not get benefit, housing, health care as they "do not deserve it" Drugs were an issue back in the 1940's but no where near as bad or endemic as they are now.

Housing was meant, in fact Beveridge specificly said that council housing should be for everyone, not just the poor, absolutely for the income tax inspectors, bank workers, and essential workers. Why, because it creates communities that everyone has a say in. In short the beloved market, capatalism, and most of all the unchanged moral views of the middle classes have been the main reason why welfare is now seen as the problem.

As w3as said earlier, pensions are the largest part of the welfare Bill, Beveridge had a solution for that too. He was much in favour of Eugenics. Perhaps he would have wanted to make sure people only got a little bit of time after their working life to enjoy retirement. Then again like the other pillars he might have been far more forward thinking and said right time for a rethink.

[Xenia2012]

The R4 programme is a good one. I'm still listening to it. The man with the 4 children who had many more than he could afford with the foreign wife who seems to think she is entitled to a lot more seems to have a better attitude than his wife. I do think if he cannot get a job then he should be minding the 4 children whilst she does. Most people are only out of work for up to a year so one hopes as he's keen he'll get something. He certainly did not sound like a scrounger but the basic benefits levels is much more than Beveridge expected.

I doubt Berveridge in 2012 would have suggested men of 65 with 20 years to live who are healthy should be killed off. I imagine he would suggest pension age be increased as it is being to 67.

I am not against a welfare state and indeed most people aren't although a lot of people think the incentive to work has been lost. I think it used to cost 4% our income and now it costs 14% the programmes said - that is presumably benefits and state pension. If Beveridge set it up so that most people middle class people would pay most of its costs and never benefit from it as they would not need it then perhaps we should be going to a system where you do not take out at all unless you fall on hard times for new entrants to the jobs market, not those who have worked for 50 years paying their stamp so they get their pension which would mean they had been misled for a lifetime.

[MiniTheMinx]

Xenia, you are keen on eugenics aren't you?

[Fifis25StottieCakes]

This government can tweek the benefits as much as they like, they will never balance unless they build more social housing or cap private rents. There's land now with planning permission for 14,000 new homes. There's also many empty properties which could be brought up to standard and be used as social housing. Its common sense really. They can move people and cap as much as they like, it's just going to cost them more. ATOS appeal's have already cost 25 million in 6mnths. Not sure how much they have saved.

IMO this is all a knock on effect of the failure to build more housing as planned with funds raised from RTB.

[Xenia2012]

Eugenics? No. I am sure I share most people's views on the subject. Obviously most people in the UK are in favour of aborting down's children and many would support techniques which means couples with a genetic problem can conceive only children who are healthy. This current generation is one of the first in history to be less healthy than its parents because of who much worse our diets and exercise amounts are than 50 years ago so I suppose we are making the species worse and worse at present.
In fact we all had fewer processed foods, a bit less food, intermittent fasting a lot of problems would go.

[Wigeon]

People on this thread might be interested in the recent report by the Work and Pensions Select Committee on Universal Credit implementation. They took written and oral evidence from a wide range of organisations, and the report was written on the basis of this evidence. The report is rather long, but the summary isn't .

I have suggested twice to MNHQ that we invite someone (eg Citizens Advice) on a webchat about UC, but I didn't receive a reply to either email. Maybe if others thought this was a good idea they could also email?