No benefit to rent: Both tenants and landlords are missing out, says Paul Gosling

Paul Gosling
Sunday 06 December 1992 00:02 GMT
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TENANTS and landlords are losing out as a result of the way the housing benefit system is working, according to the National Association of Citizens Advice Bureaux (Nacab).

Thanks to the BBC, however, many radio listeners are at least getting an inkling of the problems.

Millions of Archers followers have sympathised in recent weeks as Jill Archer has attempted to come to grips with the incredibly complex method by which housing benefit is assessed and approved.

The benefit is payable to some people on low incomes or income support, but not students. Jill has been assisting her squatter, Lisa, to claim housing benefit and persuaded husband Phil not only to accept the squatters as legitimate tenants, but also to set a rent that will be covered by the benefit. But Jill has had difficulty persuading the housing benefit office to say in advance what it would regard as a reasonable rent.

'Tenants are in a Catch 22,' said Liz Phelps, a Nacab researcher. 'They don't know until weeks into the tenancy what their benefit will be.' By that time, the landlord might be owed considerable arrears, which the tenant might be unable to pay off if the benefit was less than the rent.

According to Ms Phelps, many landlords are responding by moving out of the housing market - ironic, considering the situation arises from legislation designed to make more private rented accommodation available. 'The system is not workable,' Ms Phelps said.

The problems were brought about by changes introduced in 1988. The system of 'fair rents' was eliminated for new tenancies. New agreements were introduced, assured shorthold tenancies, which could be reviewed every six months and which removed a tenant's security of tenure beyond the term of the agreement. Housing benefit was no longer necessarily payable for all the rent. Benefit became payable for what was judged a 'reasonable rent' by the independent rent officer.

Although tenants have the right to appeal against the rent officer's valuation, few do so.

One result has been poverty for many tenants unable to afford the full market rent. Another effect has been increased indebtedness, with landlords owed more in arrears. Landlords also lose out, because of the slow processing of housing benefit claims.

Although Lisa and Craig, the Archers' squatters, have now reached agreement to rent Rickyard Cottage, in real life they would probably find their first Giro cheque for the rent a long time in coming. 'Housing benefit is meant to be processed within 14 days, but that is just not happening,' Ms Phelps said. She added that it often took months to resolve a claim, with tenants simply having no money to pay landlords the rent due.

(Photograph omitted)

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