99% rent collection rate for one housing associations universal credit experiment
A housing association in Salford has reported that its experiment with direct housing benefit payments to tenants has been very successful.
City West Housing Trust decided to set up a trial to see how direct payments to tenants would affect its own residents with universal credit set to fully roll out across the North West of England this year, reports 24dash.
City West found that at the end of the trial rent arrears among its 54 voulnteers dropped and rent collection stood at more than 99%. Of the 54 tenants, 43 had been hit by the governments bedroom tax policy.
The social landlord’s trial yielded far greater results than many of the Department for Work and Pensions’ own pilot schemes designed to test direct payments to tenants.
Justin Freeman, City West’s head of income management, said: “The results are a stark contrast to what we have seen across the sector in the other direct payment pilots and the experience of housing providers in the Universal Credit pathfinder areas. We’d seen a lot of reports on the impact that direct payments are going to have on social housing tenants with people struggling to manage their budgets. There has also been plenty of research about what that would mean for housing associations as they tried to keep rent collections high and manage their finances. We wanted to pull it all together and carry out our own research to show how it would impact in our communities, with our staff and our customers.”
The total costs associated with supporting customers rose from £14.91 per case per month for those outside the pilot to £60.51 per case per month for those taking part. The vast majority of the large cost increases related to staff time, the landlord said. They estimate that it would cost in excess of £1.2m to deliver such a level of report on an ongoing basis.
Justin Freeman said: “We wanted to make sure that we left no stone unturned. We gave customers all the support possible to cope with the change and manage their bills and budgets. It meant that the vast majority of the customers taking part, even those not used to paying their own rent, were able to take control of their own finances at an early stage. We helped them manage their income and outgoings so they could manage any debts and rent arrears, while still making sure they had enough money for day-to-day living costs. For those who were unable to take control of their finances effectively, we’ve learnt a huge amount and this will help us to seek appropriate Alternative Payment Arrangements under UC.”
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