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  • LHA/Universal Credit

    Dear Mr Couling, DWP's Director General

    Open Letter to:

    Mr Neil Couling
    Director General
    Universal Credit Implementation

    Dear Mr Couling,

    Landlords, throughout Great Britain, are experiencing unsustainable rental loss as a direct result of Universal Credit, particularly, in relation to the way in which the “housing element” is being administered. Despite phoning, e-mailing and complaining to Jobcentre Plus and regional Complaints & Resolution teams, our collective efforts have proved fruitless, frustrating and disheartening.

    The situation is getting worse, especially in areas, like e.g. London, Great Yarmouth, Inverness and East Lothian, where “Full Service” Universal Credit is now operating and arrears are running at 90%. Landlords understandably fear that as Full Service expands throughout GB so will these worrying problems.

    Nearly every single tenant owes rent, either through the delay in first payment, which can take 6-12 weeks to process. In some cases, tenants are simply misspending the housing element, rather than using the funds to reduce or extinguish their rental liabilities. When that occurs, landlords make application for redirection of the funds. Many of those applications are mislaid, take months to process or are simply ignored.

    In the most alarming cases, DWP has simply ignored the red flags and pleas, raised by landlords and continued to make payments to delinquent tenants in the full knowledge £000’s of public funds was being used inappropriately.

    Not surprisingly, the RLA and NLA are both reporting an increasing number of private sector landlords and letting agents refusing to accommodate Universal Credit reliant tenants. Lenders are also stipulating, that funds will not be provided where tenancies are intended for benefit tenants.

    Was the Alternative Payment Arrangement scheme (APAs) not designed to safeguard landlords from these very problems; avoid the problem of vulnerable tenants mismanaging their finances; and prevent delinquent tenants from misusing public funds, putting at jeopardy their tenancy and exposing them to the vagaries of homelessness?

    As Director General, you must be acutely aware and surely worried by what’s happening?

    Evidence of repeated misuse of public funds is building as “Full Service” rollout starts to bite. Landlords like Caridon Property Services Ltd have been copying you into exchanges with your staff, over many months, and, in the past week, have drawn your attention to two cases involving nearly £12,000 in rent arrears, caused by your staff failing to respond appropriately to multiple APA requests by landlords and their agents.

    DWP’s excuses to date have Included: “We can’t speak to Landlords or agents without the consent of the tenant.” ……………A “Special Payment” (as compensation for rental loss) is not merited in such cases as the tenant is the primary cause of the problem”…………..“This is essentially a civil dispute between tenant & landlord”.

    Frankly, none of these statements reflect the true cause of the problem. It’s unquestionably, DWP maladministration of its own scheme, accompanied by complete ambivalence to the predicament of landlords who rely on these funds for their livelihood and ability to pay lenders. Had your staff acted in accordance with the scheme you created, most of these substantial losses could have been avoided.

    The APA scheme was designed specifically for landlords. It requires our members to apply using a Non-secure UC 47 form which can either be sent by e-mail or FREEPOST. This version of the form was designed to “start a dialogue with landlords and agents”. It’s supposed to prompt a call from your staff, during which, the landlords’ bank details and the merits of the application can be discussed.

    You also provide a telephone number for landlords to call when they’re seeking an update on the progress of their application. Given the above, it's simply absurd to suggest you can’t speak to landlords, without the delinquent tenant’s consent.

    Landlords, having complied with the scheme’s requirements, in all respects, are surely entitled to ask for progress updates; reasons for refusal; reasons for later unexplained redirection of the housing costs back to tenants, without any discussion. Your colleague Mike Baker, Operations Director, in August 2015 acknowledged the landlords’ rights in this respect and confirmed to me, in writing, that on receipt of an APA request the “housing element” would be immediately suspended, pending a decision on the question of to whom the payment should be made. His commitment has not been honoured.

    Members have repeatedly raised with your staff, concerns over the lack of independence, impartiality and objectivity during the internal stages of your “Complaints Process”. In your responses to members, you claim that cases are considered on their individual merits.

    However, if you examine the common thread of each response, it’s really nothing other than a standard reply, crafted by someone in your Policy Unit. It was your Policy Unit who prescribed “Special Payments” were NOT to be used in landlord APA applications for compensation. Interference of this type completely undermines the notion of cases being considered on their individual merits and suggests more of a sham complaints process.

    The third stage of the Complaints Process (Independent Case Examiner) is truly the first time the complaint is looked at independently. Past reports from ICE suggest 50% of complaints are fully supported with a further 25% partially supported. At first, this looked a promising way to prosecute a complaint but we’ve since found it takes 15 months, on average, from referral to conclusion stage. A classic case of justice delayed, justice denied!

    As an ex COSLA advisor to the Housing Benefit Standing Committee, Westminster I’ve spent 20 years dealing with DWP hierarchy, including the Policy Unit team in the Adelphi, London. My colleagues and I had a very fruitful relationship with this team who demonstrated a high level of knowledge and commitment to tackling and resolving problems. I’ve yet to see anything like that from you and your support team with maybe 1 or 2 exceptions.

    Five years ago, I wrote an article “Hitting the DWP brick wall” which was published by the SFHA and private sector magazines, predicting the biggest problem with Universal Credit would be your department’s remote and ambivalent administration of the scheme. If anything, I underestimated just how problematic it would be.

    In my opinion, something drastic is needed to overhaul the current APA and associated Complaints Processes as both are currently unfit for purpose. Apart from travelling the country, speaking to staff in the new Full Service areas, what are you doing to address the legitimate concerns of landlords?

    Bill Irvine

    UC Advice & Advocacy Ltd

    Phone 07733 080 389 or 01698424301




    Excellent letter and well written.

    Given your comments could I recommend this to you:

    The Whitehall Effect: How Whitehall Became the Enemy of Great Public Services and What We Can Do About It 

    It's worth the read....though will probably make you even more frustrated at the way 'the system' works.


    I support Universal Credit is is the way the benefits system should be run - one place to manage, one payment and not multiple claims in a confusing array for low income claiments.

    The real issue Bill, as you rightly outline is that the DWP has an issue with communication.

    In your letter you say you can "email" the DWP but only in an insecure way - the private landlord has no access to the "secure email" system (unless a lawyer is used).

    This causes big issues as for a request to be processed the DWP say they need a National Insurance Number, something that can not be put on an "insecure form" and if it is the form can be ignored as it contains "sensitive information" - not even a reply to say so.

    You call and they refuse to talk. Have had stonewalling from "we can not tell you" to as you say "tenant needs to provide consent" despite it being part of tenancy terms.

    It certainly needs change - I would suggest the DWP should invest in a discussion with Landlords on how to resolve the issues.
    What landlords expect? Where the DWP is limited in what it can provide and how to resolve to a compromise.

    In the end - what the general public gets will be more landlords saying "No DSS" and more homelessness/ccjs for Tenants - as the DWP hinders landlords efforts to resolve payment issues in order to prevent voids/cost of eviction/etc.

    Universal Credit can work if done right. On paper it can be seen as better than LHA - its just got too many issues right now.



    My posts are not financial advice, just a rambling guy passing time on a coffee break.
    The team at Bespoke Finance offers advice, including Limited Company Buy-to-Let , HMO Conversion and Cheap Life Insurance.


    Excellent letter Bill.

    Outlining all the failures in this new system.

    Universal Credit was rolled out at the beginning of 2010 many landlords believed that the issues they encountered at the beginning were merely teething problems, however 4 years on there still appears to be no improvements just a new APA form.

    What is the point a landlord completing an APA form and calling DWP to chase up the progress being told they are unable to discuss the request.

    The system needs to be reviewed, maybe DWP staff should be trained by Housing Benefit staff!!!!!!


    Coming at this from a different angle.

    Would it not be worthwhile councils setting up CU for payment of all UC etc?

    There is common purpose there.

    With UC payments made to a council CU there would be less chance of the tenants spending the HB on things other than the rent.

    Of course it would not be compulsory but few LL would allow any UC tenant not to have payments made to the CU.

    Perhaps existing CU could join with a council to provide this service.


    I think it is excellent that someone of Bill Irvine's standing is acting pro bono on behalf of so many landlords and then posting on a public forum. Also good of Vanessa to tweet NC and get a response.

    The power of social media.


    I have been posting wake up calls on here for ages (over 2 years ago at least) about the implications for landlord of the introduction of UC.

    As a taxpayer I find it appalling that government give benefit claimants housing benefit in the UC system with absolutely no obligation that this has to be passed on to their landlord. When they spend it on something else, rather than pass it on to their landlord , the benefits systems continues to give them the money rather than pay the landlord direct. Surely, they are being given this benefit to pay their rent because of their circumstances.

    As a landlord, it means that I am no longer seeking properties to house benefit claimants. The situation is so obvious I don't understand why "government" cannot see this. Bit like untaxed vehicles on the road - stop road tax and add an additional tax to petrol and diesel. Everybody then pays and the more miles you do the more tax you pay - it's not rocket science and it's less bureaucratic.


    DWP's response to Bill Irvine's Open Letter


    [Image: 4995468760_6be86655d4_t.jpg]
    general operations director, site owner and moderator - propertytribes.com

    Another example of a clueless Tory Govt

    They will lose power to Labour next GE and UC will be then thoroughly reformed.

    Just means that more LL will stop renting to HB tenants.


    Good morning

    Firstly, I should say I was pleased to see Neil Couling following through with his commitment of responding to my original letter. However, I feel obliged to comment on what he's said:

    Dear Mr Couling

    I appreciate you taking the time to respond to my earlier letter but, after waiting a month, I expected something more precise and credible, from you, the Director General.

    You claim my views are not representative of what’s happening and are based purely on the dozens of cases presented by my landlord clients. You may have missed it, but the House of Commons library produced a report, only this week, “Housing Costs in Universal Credit” - https://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN06547#fullreport

    Chapter 3 of the report - “Early experiences of implementation” – echoes exactly what I was referring to in paragraphs 2 & 3 of my letter. It confirms, throughout Great Britain, rent arrears are going through the roof and refers specifically to what’s been happening in East Lothian, Great Yarmouth, and the London Borough of Croydon (all “Full Service” areas) mentioned in my letter. It also cites the chaos experienced in East Lothian and the London Borough of Croydon, caused primarily by - the move to Full Service delivery.

    You well know, in the case of Croydon, the Council reported a loss of £2.5 M in rental revenue, solely from its temporary accommodation tenants. The report forced DWP Ministers to concede paying “housing costs” to temporary accommodation clients was unworkable, under Universal Credit and promised to revert administration back to Housing Benefit. Whilst the change is warmly welcomed, it should never have happened in the first place.

    Why did it happen? DWP chose to ignore the advice of experienced Homeless Accommodation staff from councils, charities etc. experienced in that area.

    At paragraph 3.2 of the report it refers to the fact, the Work & Pension Committee decided, in February 2017 to re-launch its inquiry into Universal Credit due to: “compelling evidence of the problems in the rollout of Universal Credit in its recent follow ups”.

    So, contrary to your suggestion I was misrepresenting the situation, the facts in the H of C report, suggest my claims were entirely accurate, and expose your criticism as unwarranted.

    In relation to my criticism of the APA process, I outlined the concerns of many clients who had experienced significant rental loss, despite having applied for “Landlord Managed Payments” using the designated UC 47 non-secure, supported by evidence of Tier 1.8 criteria. Having heard nothing, they contacted DWP for an update, using the dedicated numbers supplied, by no less than DWP in its APA paraphernalia. Armed with their tenants’ National Insurance number and DOB, they expected to be given an update on the LMP’s progress. Instead, they’ve been consistently told your staff can’t converse with them, without the “explicit consent” of the tenant, who, in some of the cases referred have already misused £8 – 10K of costs designed to reduce or extinguish their rental liability. Landlords simply can’t sustain such levels of loss.

    Given the fact, all landlords had complied with the APA process, created by DWP and were looking for simply an update on their application and an assurance the housing element would not continue being paid to tenants who had already accrued 2 months’ rent, I’m at a complete loss to understand why DWP is insistent the claimant’s explicit consent is a critical factor, and without it, feels obliged to continue awarding more housing element payments when, it’s known the offending tenants will simply repeat the misuse?

    I should add, I don’t have a monopoly on that view, having spoken to many staff in your “Complaints & Resolutions teams” who are evidencing, daily, public monies being misused on a disgraceful scale, mainly at cost of landlords, many of whom have lenders to pay. The fact only one third of the 530,000 UC claimants have “housing costs” is a blessing at this stage. What concerns landlords most is, as Full-Service rollout continues to expand, so will the numbers of LMP requests; associated delays & complaints; increased rental losses; and an ever increasing drain on the public purse, caused by DWP maladministration; something the Secretary of State has a duty to protect.

    What I find most disappointing is the comments in the last paragraph where you confirm you’re no longer willing to honour the commitment made in August 2015 by your then depute, Mike Baker, Operations Director. You recall, I wrote to you, expressing concern about APA administration and the fact the “housing element” was not being suspended, pending a decision on the merits of the LMP application. I cited support for my suggestion by referring to the Judgement of Upper-tier Judge Jacobs (R (H) 2/08) relating to what happens in HB administration. Near the end of the decision the highly regarded Judge makes some entirely sensible recommendations to HB administration staff, which I’ve used to secure compensation for PRS landlords, sometimes after referral to the LGO.

    In that case, when a landlord applies for redirection of payment, based on HBR 95 or 96 criteria, they‘re considered “persons affected” attracting rights. As such, when they request redirection under “safeguarding” principles, HB should be suspended, to allow council staff to contact both tenant & landlord to establish the facts, before deciding on who should be the “payee”. The decision rests with the “Decision Maker”. Claimant consent is NOT required but each have a right to appeal if they disagree with the decision. Once made, that decision can only be changed by way of revision/supersession – in other words, a mistake has been discovered or a change in circumstances.

    You passed the matter to Mr Baker to respond. He, after taking legal advice, agreed that payment, in the case of UC, would be suspended if the next due payment was 5 or more days away. You implicitly agreed with that view, which I communicated to more than 1000 website members. Other than your opinion, nothing else has changed and the regulation (Regulation 58) permits suspension of the UC award or in part (i.e. the housing element).

    As you well know, I’ve been a Universal Credit advocate, mainly because I agree, the current legacy system is broken and needs replaced. My letter to you was a genuine attempt to assist you in your stated aims of listening, learning and improving UC’s delivery. In response, your spirited defence of Universal Credit scheme principles evades the specific concerns raised, representing, in my view, a missed opportunity to genuinely engage with landlords concerns and secure improvements to a scheme which currently is failing them. In some case, especially where Full Services is operating, the extent of losses could bankrupt some, if the situation I’ve described is not addressed ASAP.

    You’ll not be surprised to hear that I’ll continue to support my landlord clients by encouraging them to challenge your department’s mishandling of the housing element and, in that regard will continue engaging with your CRT staff.


    Bill Irvine

    UC Advice & Advocacy Ltd