Universal Credit: Private Rented Sector

Debate between Ruth George and Stephen Lloyd

Tuesday 9th January 2018 Westminster Hall

[Stephen Lloyd (Eastbourne) (LD)]

I beg to move,

That this House has considered the effect of universal credit on the private rented sector.

It is a privilege to serve under your chairmanship, Mr Gray. It was good to obtain this debate, and I am delighted that a range of colleagues have come to speak on such an important issue.

This is indeed an important debate. We all know and read about the challenges with the lack of housing across the UK. Some 1.2 million to 1.3 million people on housing benefit or local housing allowance are in the private rented sector. Most of us will know from our constituency casework that many private sector landlords are reluctant to let to people on housing benefit. My supposition, which is clearly proved by the evidence, is that the universal credit roll-out, up until the recent changes in the Budget, would not acknowledge the issues and the challenges and frustrations for private sector landlords not wishing to rent to people on benefit and certainly not to those on universal credit, and that without a default payment direct from the Department for Work and Pensions to the landlord, even more people in the private sector will pull out of the whole area. That has proved to be the case.

How did we get to this situation? I remember that when I was last a Member of this place, I served on the Select Committee on Work and Pensions and I repeated ad nauseam to the then Secretary of State, the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith), that one fundamental flaw of universal credit was the insistence that the tenant should receive the full housing benefit and pay it on to the landlord. I understood the argument; I understood that that was about encouraging responsibility. My frustration—I argued this very assertively in numerous Select Committee sittings—was that the problem with ideologues is that they fit the facts to their ideology, rather than recognising that facts are facts. I was sure, from my own experience as an MP and from talking to colleagues, that sadly many tenants on universal credit would not pass the money over to their landlords, for one reason or another, and that that would make the private rented sector even more nervous about letting to people on housing benefit.

[Ruth George (High Peak) (Lab)]

The hon. Gentleman is making an excellent speech on a very important issue, and I apologise because I will have to attend the Finance (No. 2) Bill Committee shortly. A landlord who came to my surgery had 20 tenants on universal credit, of whom 18 were in arrears and nine had to be evicted. That is at this very early stage of the roll-out, when full service has not yet come to my area. Does the hon. Gentleman agree that those are the sort of facts that do not fit into the theory of universal credit?