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Friday, 3 August 2012

Benefit changes are in danger of causing “chaos and confusion” and could see people and charities plunged into debt, housing bodies warned this week.

Unemployment and housing benefits are due to be replaced in April next year by the new single-payment Universal Credit.

However, housing bodies this week said recently published guidelines do not explain how the new system is going to work.

They say the guidance has failed to address how families will manage their income in light of rising living costs and the so-called bedroom tax, which will see benefits cut to tenants with a spare bedroom ­– even when smaller accommodation is not available.

Social landlords and charities are also concerned that the system could facilitate domestic violence, as the full payment will be paid to an individual family member.

Universal Credit will see families getting a single payment that covers all their costs and current option to have housing benefit paid directly to landords will be scrapped.

The fear is that some people will use the rent element of their Universal Credit to pay for other costs and fall behind with their rent.

The Scottish Federation of Housing Associations (SFHA) said it has several concerns about the DWP’s draft regulations for Universal Credit and Housing Benefit, which are supposed to outline in detail how Universal Credit will work.

The government has not for example explained who will be classed as “vulnerable” and therefore be able to access more support.

Maureen Watson, SFHA policy director, said: “A comprehensive definition is needed to ensure that people with literacy, numeracy and confidence challenges are not disadvantaged.”

The benefits system will also include a cap on benefits at £35,000 a year for a family and £26,000 a year for lone parents.

“The impact of the benefit cap will hit households who need larger accommodation, at a time when jobs are difficult to get. This will serve only to increase child poverty and homelessness,” added Watson.

The body also raised concerns about the push to online claiming and the fear that service charges that were previously included in housing benefit will not be covered.

Watson concluded: “The DWP is making big changes to the benefits that people are entitled to, and at the same time, how they are administered.

“The government needs to work with social landlords to help support tenants who will face difficulties in coping with these changes, if we are to prevent chaos and confusion.”

The Scottish Council for Single Homeless (SCSH), a membership body for organisations and individuals tackling homelessness, submitted 21 questions to the DWP over a month ago.

It says the government has refused to respond to its concerns and that its new guidelines do not address the issues raised.

Robert Aldridge, chief executive of SCSH, said: “Most of the questions still remain outstanding. The regulations give some details but not down to the detail that people require when they are planning to change their services to meet the new system.

“The most significant thing is that there will be a single payment to one member of a household and clearly there are issues here relating to control, or even worse, if there’s a situation of domestic violence. It appears that it would also apply to an adult child living in a household.”

“The real concern is that Universal Credit kicks off and people fall through the net or services inadvertently find themselves in difficulties simply because they’ve not been able to plan in advance and are not aware of the consequence of the changes.”

Earlier this month, concerns were raised that the IT systems needed to run the new benefits system would not be ready in time.

A DWP spokesperson told TFN that the government is confident that the system will be ready to roll out in 2013.

She said: “We are committed to our welfare reforms but we are ensuring the views of groups are reflected in consultations on the regulations, so there are the necessary safeguards in place.

“We are currently working with councils and housing associations to ensure vulnerable people receive the right support through the introduction of Universal Credit and beyond.”

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