Housing benefit warning: Rishi Sunak 'has failed' as Covid debt rules change next week

6 mins read


Housing benefit claimants specifically are set to struggle in the coming weeks, with the National Residential Landlords Association (NRLA) warning thousands of private renters who have built arrears during the pandemic will face problems finding an alternative home because of damage to their credit scores. Emergency restrictions placed on the housing sector will be easing from June 1 and this will affect families who need Government support.

He said: “As the private rented sector moves out of lockdown measures, the Chancellor has failed to provide tenants with the support they need.

“This is especially the case for the majority of those in rent arrears who do not qualify for benefit support.

“Without urgent assistance, many tenants face the prospect of losing their home needlessly as landlords struggle to shoulder the cost of arrears. Affected tenants also potentially face the negative impact of damage to their credit scores.

“The Government needs to develop a financial package which ensures that benefits cover the rents of those in receipt of them. For those who do not qualify for benefit support, an interest free, government guaranteed tenant hardship loan should be established, similar to those in Wales and Scotland.”

From June 1, evictions for rent arrears in England can resume and as such, StepChange Debt Charity also called for the Government to introduce changes.

The charity urged the Government to introduce a targeted package of grants and no interest loans if tenants are to avoid losing their homes.

This could be an urgent issue for many as the Ministry of Housing, Communities and Local Government (MHCLG) has also confirmed the shortening of eviction notice periods from six months to four months from next week.

StepChange, alongside Generation Rent, Money Advice Trust, National Residential Landlords Association, PropertyMark and Shelter, will deliver proposals to MPs and officials from MHCLG and the Treasury this week setting out how the package of grants and no-interest loans could be provided in England.

These proposals include:

  • The Government should make grants available to low-income households who have built up rent arrears during the Covid pandemic.
  • The Government should back a wider programme of no-interest loans – delivered by HMRC through a student loans-type scheme or another credit provider – for anyone who has been forced into rent arrears due to the pandemic who is not eligible for a grant, including the self-employed.
  • Loans must be affordable: loan repayments should only commence once a person’s income reaches an affordability threshold of £20,000 per person annual income, which reflects the median of the London real living wage and national real living wage.

Phil Andrew, StepChange’s CEO, commented on the end of the eviction ban.

He said: “The rental eviction suspension was the last lifeline for many renters, who have been among the groups worst hit by the pandemic. The number of private renters in arrears has doubled since the start of the pandemic to 460,000 people. With evictions now resuming, many will be facing an uncertain future without additional financial support.

“Support from Government, like furlough and benefit uplifts, has been important in helping people through the pandemic, but not sufficient to keep many renters out of arrears. There are clear gaps in support which have seen a £360million black hole of rent debt build up over the course of the pandemic.

“The Government can help by creating an emergency package of grants and no-interest loans to help rescue those in rent arrears due to Covid. It will help keep people in their homes, avert mounting problem debt, housing insecurity and homelessness and will enable people to get back on their feet after a devastating year. What’s more, an extra 30,000 evictions would cost the public purse in the region of £225million, yet almost all of these costs can be prevented by investing a similar amount now.

“The housing secretary said in March 2020 that no-one should lose their home due to the pandemic – it’s time for decisive action to back that up.”



Leave a Reply

Your email address will not be published.

Previous Story

NYC EMT says he was attacked for being Jewish in Las Vegas

Next Story

Joker 2 'confirmed': Todd Phillips 'strikes deal to co-write sequel'

Latest from Blog

withemes on instagram