South Tyneside Universal Credit rent arrears rocket beyond the £1m mark

Rent arrears owed by social housing tenants on Universal Credit has rocketed beyond the £1m mark in just nine months since the controversial benefit was fully rolled out locally..

Thursday, 23rd May 2019, 17:23 pm
Universal Credit rent arrears on South Tyneside have rocketed beyond the 1m mark.

The average £662 sum owed to South Tyneside Borough Council is also nearly £170 per person higher than the £494.38 average owed by those still claiming the old-style housing benefit.

Critics fear the deficit - unearthed as part of an investigation by the Gazette and parent company JPIMedia - will increase and hit front line council services unless the Government reforms or scraps the payment system.

Universal Credit rent arrears on South Tyneside have rocketed beyond the 1m mark.

Universal Credit, introduced by the Conservative-led coalition Government in 2013, lumps six benefit payments into one monthly benefit.

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Aside from subsequent budgeting pressures, applications can only be made online with most initial payments taking a minimum of five weeks to arrive.

The housing benefit element of Universal Credit is also paid direct automatically to the claimant rather than the landlord.

Coun John McCabe has described the official Universal Credit helpline as "as much use as a chocolate fireguard".

Our investigation additionally reveals that more than two million calls to the Department for Works and Pension's (DWP) official helpline have gone unanswered since the start of 2017.

The number for the first quarter of this year - 559,613 - is more than 230,000 higher already than the 329,317 figures for all of 2017.

The helpline - rated bottom by claimants ringing the DWP about 10 different types of benefits - has been labelled "as much use as a chocolate fireguard" by a leading South Tyneside councillor.

Labour's Coun John McCabe, chairman of the council's people select committee, which examines the effects of Universal Credit, said: "It is absolutely useless. I have people coming to me at my ward surgery to say they cannot get through or that they have been given contradictory advice."

The Gazette and parent company JPI Media is investigating problems triggered by Universal Credit.

Full service roll out - which means everyone making a new benefit claim is placed on Universal Credit - arrived on South Tyneside last May.

Since then the number of people receiving the single payment across the borough - including those not paying rent to the authority - has more than tripled to 7,203 as of March.

A Freedom of Information request to the council showed that 1,719 Universal Credit tenants owed £1,139,199 to the authority at around the same time.

Arrears for the 3,204 housing benefit tenants who owe rent add another £1,584,017 to the overall deficit.

Coun McCabe said: "The figures do not surprise me as we've been fearing the worst since before it was rolled out.

"It's only going to get worse and affect more services unless it is seriously reformed or preferably scrapped.

"While we want tenants to pay their rent, I have a lot of sympathy for the people who genuinely struggle to pay and have to choose between buying a pair of shoes for a child and paying households bills."

The South Tyneside figures compare to the £681 average rent owed nationally by Universal Credit tenants and the £285 average figure for housing benefit tenants.

A DWP spokesman said it was wrong to blame Universal Credit for rising rent arrears, adding: “Many people claim Universal Credit after a significant life event and will join with pre-existing arrears, while those on legacy benefits are likely to have been claiming for a longer period, with arrears having reduced over time.”

As for the helpline figures, a spokesman said: “Since January this year we have answered almost 3.7m calls to the helpline and latest figures show that people wait less than three minutes on average before their call is answered.”

*The official helpline number is 0800 328 5644.