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Universal Credit – A Shock for Lord Freud

Lord Freud, when Welfare Minister, was the mastermind behind the planning and introduction of Universal Credit, despite opposition from many quarters, not least private sector landlords worried about receiving their rent.

Although Lord Freud is supposed to have consulted on it widely, it went ahead, despite representations from private landlords who believed that the idea of paying tenants the housing element of Universal Credit, rather than the landlord, would create vast rent arrears which would lead to increased homelessness. 

Lord Freud resigned from the Government in December 2016 but a recent appearance at the Work and Pensions Committee, confirmed what any private sector landlord would have told him – that a quarter of those on Universal Credit were accruing arrears. 

Whilst private sector landlords will take little consolation in being proved right and Lord Freud proved wrong, as they see their rent arrears rising. There may be some pleasure in the fact that many of these arrears are occurring not in private sector properties but in social housing.

Private sector landlords are often much maligned for being harsh with their tenants and evicting them, even when the eviction is merited due to rent arrears. Private landlords were blamed for rent arrears due to bad management and poor choice of tenants.

This must obviously also apply to social landlords, who are evicting far more tenants now for the Universal Credit generated arrears. What’s sauce for the goose is sauce for the gander!

Perhaps one day, the private sector landlord will stop being viewed as the enemy and will play a full role in consultation exercises. The opinions of private landlords should be respected – they see tenants at their best and their worst, and as has been proved with the Universal Credit experience, private sector tenants and social housing tenants have the same capacity for badly managing their tenancies and deciding not to pay the rent.

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