Many of our members have raised concerns about the Universal Credit calculation for residents with weekly tenancies in years where there are 53 weeks. We've put together a briefing and template for NHF members to write to their MPs, to help housing associations call for a change to the legislation.
At the moment, current legislation is causing many residents of social housing to lose out on around £100 a year during a cost of living crisis.
At the NHF, we’re calling on the government to change legislation to make sure residents of social housing aren’t left unable to pay their rents. To help our members call for change, we’ve put together a letter housing associations can use to write to their MPs.
What is the 53-week rent year?
Current legislation means Universal Credit is calculated by multiplying weekly rent payments by 52-weeks. This means that when a resident pays rent weekly, they will make either four or five payments in a month.
However, every five or six years, there is a 53-week rent year, rather than a 52-week rent year. The next time this will happen is the upcoming financial year (2024-2025).
This means that residents will be underpaid by Universal Credit in the months they make five rental payments. In most years, the rent due and the Universal Credit payments will match, but every fifth or sixth year, residents will be left short. For many residents, this will mean they’re short on rent by around £100.
What impact does this have for residents and housing associations?
We’re concerned about the impact this will have on residents, especially during a cost of living crisis, where many are struggling financially.
Our NHF quarterly survey on Universal Credit shows that residents who claim Universal Credit are more likely to be behind on their rent compared to other residents. This could cause financial and wellbeing issues for residents effected.
If residents are unable to pay rents, housing associations will also risk facing financial difficulties, during a time of rising costs. This could amount to millions worth of shortfalls for the sector.
How can the problem be solved?
To solve this problem, we’re asking the government to make changes to the Universal Credit system through a legislative amendment. That’s why we’re asking the Department for Work and Pensions to take action on this, to make sure residents of social housing aren’t left short during a cost-of-living crisis.
At the NHF, we’re calling on the government to make this change urgently. We’ve put together a letter our members can use to write to their MPs, asking them to table a debate in parliament or submit written Parliamentary Questions.
Please contact us using the details below if you have any questions, or would like more support working with political stakeholders on this issue.