Welfare Reform Minister Speaks Out On Universal Credit
Controversial welfare reform minister Lord Freud has spoken exclusively to Residential Property Investor magazine, published by the Residential Landlords Association.
Universal Credit was originally intended to be a fundamental reordering of the UK’s welfare and state benefit system, however when policy guidelines were announced, the reforms dealt private rental sector landlords a cruel blow, as it was decreed that landlords with tenants claiming local housing allowance (LHA) would no longer receive direct payments, even if they believed that the tenant was in an extremely vulnerable position.
The original intention for the welfare reform was not just about simplifying the current welfare system in the UK, it was also intended to abolish a series of benefits and amalgamate tax credits into a single monthly payment for benefit claimants.
However Lord Freud insists that the welfare reforms are about changing people’s lives for the better.
The Government claims that the current benefit system fails to treat benefit claimants like adults and the present system does not empower unemployed people to take charge of their own responsibilities.
The general consensus of opinion of the people in power was that this situation had to change because too many people had become used to the benefits system looking after many aspects of their daily lives, including paying the rent.
The national roll out of Universal credit payment system has been dogged by delays with officials claiming that this was due to having a poor IT infrastructure that would require updating in order to be able to cope with demand.
However, the delay of a national roll out of the Universal Credit scheme provides additional breathing space for landlords as reports from trial areas suggest that rent arrears have increased with benefit tenants struggling to manage their finances and are falling further into rent arrears.
In the article Lord Freud discusses the need for welfare reform, the welfare changes currently being rolled out, and the important part that private landlords have to play in helping tenants gain financial independence.
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