Rent arrears rise predicted by housing associations

New research shows 90% of Scotland's housing associations expect their tenants' rent arrears to rise next year

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The vast majority of Scotland's housing associations are predicting that rent arrears will rise next year because of changes to benefits.A survey of Scottish Federation of Housing Associations (SFHA) members said many were worried about the introduction of the "bedroom tax".

Under the plans, social housing tenants' benefits will reduce if their home has one or more spare bedrooms.

Last year, 36 of 120 associations reported increased rent arrears.

Under proposals from the UK government, if social housing tenants are said to have one spare room, their housing benefit could be cut by 14%.

If they have two extra rooms or more, the cut would be 25%.

These changes are estimated to impact upon about 100,000 Scottish households.

The survey of SFHA members found 112 out of 120 believed changes like the introduction of the "bedroom tax" and the Universal Credit would increase arrears.

The SFHA said they were concerned at the impact the changes would have on low income families - and the impact any increase in arrears would have on investment in social housing.

'At risk'

Start Quote

We are providing councils with £155m this year to support people and vulnerable groups who might be affected by these changes”

End Quote Department for Work and Pensions spokesman

Dr Mary Taylor, chief executive of the Scottish Federation of Housing Associations, said: "The SFHA is concerned that most housing associations are predicting increased rent arrears. Housing policy has up until now provided long-term homes for people taking into account their future needs as well.

"If tenants cannot pay for the bedrooms that they were allocated and no longer need, that presents a risk to rental income.

"The under-occupancy penalty is unfair on tenants. Any increase in rent arrears could put funding for housing associations at risk, with a knock-on effect on their ability to build the homes that are urgently needed today."

Responding to the SFHA survey, a spokesperson for the Department for Work and Pensions said: "Our reforms are about restoring fairness to the benefits system.

"We are carefully working with councils and housing associations in Scotland as our welfare reforms are being introduced to ensure vulnerable people are protected.

"We are providing councils with £155m this year to support people and vulnerable groups who might be affected by these changes.

"We need to ensure a better use of social housing when over a quarter of a million tenants are living in overcrowded homes and two million are on housing waiting lists across the country."

Scrapped

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It is completely unacceptable that vulnerable people in Scotland should bear the brunt of this ill-considered and damaging tax”

End Quote Margaret Burgess Scotland's Housing and Welfare Minister

The benefits system is reserved to the control of the UK government.

Publication of the SFHA's survey comes the day after the Scottish government said it wanted the "bedroom tax" scrapped as it would impact disproportionately on people with a disability.

Scotland's Housing and Welfare Minister, Margaret Burgess MSP, said: "It is completely unacceptable that vulnerable people in Scotland should bear the brunt of this ill-considered and damaging tax.

"Our clear position is that this punitive and unfair policy should be scrapped. However, the UK government seems determined to press ahead and the current constitutional arrangements mean there is nothing we can do to stop them."

Shadow Secretary of State for Scotland Margaret Curran MP said: "The bedroom tax is a cruel and unfair attack on people across the country.

"The UK government just don't get it. They're giving millionaires a tax cut at the same time as penalising some of the poorest people in our country."

UK Welfare Secretary Iain Duncan Smith has instructed officials to "look again" at how the changes would impact on those with a disability.

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