Impact of Universal Credit and the ‘bedroom tax’ on Doncaster residents revealed

The impact on Doncaster residents due to benefit reforms such as Universal Credit and the bedroom tax has been revealed.

By George Torr
Tuesday, 12th February 2019, 4:23 pm
Updated Tuesday, 12th February 2019, 4:29 pm
Numerous studies have said Universal Credit is driving more people to food banks
Numerous studies have said Universal Credit is driving more people to food banks

In a report seen by cabinet members on Doncaster Council, it’s estimated 7,500 tenants will be affected by Universal Credit, which combined six benefits into one single payment. 

An additional £24 million of rent income will need to be collected from tenants which was previously paid directly to the Housing Revenue Account from housing benefits.

People are waiting five weeks or more for Universal Credit payments when transferring over

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Documents also show over 2,000 current Universal Credit claimants will miss out by around £124 as the Government has not taken into account the extra Monday in the 2019/2020 financial year.

Council bosses said this would likely leave tenants with further debt and was a ‘direct contradiction of the principles’ of Universal Credit where ‘no one was supposed to be any worse off’. 

It aims to make claiming benefits simpler but people in Doncaster and across the country who have transferred onto the system have been hit with lengthy payment delays due to the complex administration process.

One Doncaster councillor said people ‘were taking their own lives’ because of welfare reform. 

Doncaster councillor Tosh McDonald said Universal Credit was one of the main reasons people are visiting food banks

Reports show under occupation or the ‘bedroom tax’ as it more commonly known, currently affects 2,039 tenants which has resulted in their housing benefit being reduced by £1.25 million – or £613 per person. 

The controversial policy reduced benefit payments by 14 per cent if a working age resident had one bedroom spare and 25 per cent if they had two. 

Polling in 2016 found two-thirds of the people affected are registered as disabled and many found themselves suddenly liable for the bedroom tax after deaths.

The bedroom tax still applies to tenants that claim Universal Credit but Doncaster housing chiefs said the Department for Working Pensions do not share the information leaving council bosses in the dark about how many tenants are affected. 

Universal Credit

Figures also show 91 families are affected by the benefit cap which limits the amount of welfare payments people can receive. 

This was set at £26,000 in July 2013 and has been further reduced to £20,000 for families and £13,400 for single claimants with effect from January 9, 2017. 

Labour Town ward Coun Tosh McDonald said Universal Credit was ‘one of the main things pushing people towards food banks’. 

“Because landlord aren’t being paid direct, it’s causing a problem with rent arrears and people are getting into more debt,” he said. 

“There’s a five-week minimum wait with people transferring over and that in itself is madness – we’re talking about people on very low incomes and these aren’t people who have savings to get them through five-weeks.

“I was talking to a couple of people in the St James’ flats area recently who are both on Universal Credit and both are really struggling 

“This is one of the main things that are pushing people towards food banks.

“My feeling is, like the Labour party’s official view, the idea of a Universal Credit that everybody can get isn’t a bad idea but it’s been rolled out without it being tested – there’s been people dying, taking their own lives because of it.”

Julie Crook, director of corporate services at St Leger Homes, said: “Changes to welfare benefits have a direct impact on individual tenants which usually results in them having less income.

“This can impact on their ability to pay their rent, this can also lead to an increase in rent arrears and then eventually increased property turnover and associated costs. 

“During the financial year 2019/20 there will be 53 Mondays, for tenants receiving Universal Credit this will not be taken into account when calculating their entitlement, the impact of this is that approximately £350,000 will not be paid to tenants for them to pay their rent, it is highly likely that this will result in an increase in current tenants arrears.

“This is a direct contradiction of the principles of UC where no one was supposed to be any worse off and housing benefit payments take account of 53 Mondays.

“The changes to welfare benefits will have a significant impact on housing services within Doncaster. Tenants are informed of the changes on a regular basis via Houseproud (the tenants’ newsletter) and both the council and St Leger Homes’ website.

“Councillors are kept up to date of these changes through members’ briefings.”

A DWP spokesman said they are working with landlords to make sure they understand the Universal Credit process. 

“No one on Universal Credit will be left with a week’s rent shortfall as a result of having 53 rent payments in a year," a spokesman said. 

“Having 53 rent days does not mean paying more rent over a year as most of the final payment will cover the first week’s rent for the following year.”