Direct payment of rent component of Universal Credit to Private Rental Sector Landlords

Tuesday, 1 October 2019 - 10:46am

Last month, we attended the DWP stakeholder meeting where one of the issues raised was Alternative Payment Arrangements (APA). As many of your will know, APAs include Managed Payments (MP) of housing costs direct to landlords, including private rented sector (PRS)  landlords.

The tenant themselves can ask for payments to made directly to their PRS landlord. What many tenants may not know is that their PRS landlord can also apply for the housing proportion of their Universal Credit (UC) to be paid to the landlord.

As you might expect, the landlord has to give a reason for asking that the housing proportion of their tenant’s UC be paid to them directly. The DWP suggests the following reasons for requesting a direct payment:

  • Arrears equivalent to two months’ rent
  • Persistent underpayment of rent

There are also other grounds that the landlord can use to make a direct payment request. These include the tenant having ‘drug/alcohol and/or other addiction problems, such as gambling’; being ‘homeless’; having experience of ‘domestic abuse and violence’; having a ‘mental health condition (like a phobia, bi-polar disorder, depression and anxiety)’. The landlord is under no obligation to provide evidence of, for example, their tenant having a mental health issue. 

APAs can play an important role in enabling vulnerable clients to manage their housing costs. Many of our members, and people living in the accommodation they provide, support the use of APAs as they can prevent clients running up arrears and reduce the risk of eviction. Guidance is available to services to help identify the need for APAs and how to apply for them. However, concerns have been expressed to us recently that more PRS landlords are requesting direct payment of housing costs when the tenant neither needs nor wants that to happen, limiting the choice and control they have.

As ever, we need to know what’s happening on the ground. What is your experience of APAs? Have any clients you worked with expressed concerns? Is there anything which could improve how APAs are being used or the process to apply for them to ensure clients are well informed?

Let us know via sue.christoforou@homelesslink.org.uk or 020 7840 4421. Any examples you are able to share will inform our ongoing discussions with DWP and help ensure vulnerable tenants are properly informed and involved about potential changes which might affect them.