Councils will be able to protect private landlords who have tenants on housing benefit from the government’s new regime for two years, it has been announced.
It means that councils will be able to make direct payments of local housing allowance (LHA) to landlords in exchange for them agreeing to lower their rents, for this period.
After that, LHA will automatically be paid direct to the tenants.
But the British Property Federation lashed out at the arrangement, calling it worthy of ‘Del Boy’.
Changes that will see LHA capped at £400 a week for new tenants in private rented accommodation are among LHA reforms that came into effect last Friday. LHA will not exceed £250 for a one-bed property.
Landlord groups have consistently called for LHA tenants to be able to choose to have their benefit paid to them or direct to their landlords. But the Government has decided against this, offering the two-year deal instead.
The British Property Federation questioned the two-year deal.
It described it as a move that would see council staff having to wheel and deal with local landlords to reduce their rent in return for the comfort of getting paid direct.
Ian Fletcher, director policy at the British Property Federation, said: “This is ‘Del Boy’ benefit policy – seeking to trade a landlord’s right to be paid with the Government’s desire to reduce its expenditure.
“If this was really about protecting tenants, why limit it at two years, and not give an ongoing commitment to direct payment up until housing benefit is absorbed into Universal Credit?
“Landlords should expect to get paid for the housing they provide. That shouldn’t be contingent on lowering rents, or having to wait eight weeks under the current system.
“The Government would not dare treat other small businesses in such a way, but seems to think it is acceptable to allow people to rack up huge debts and treat landlords so badly.”