Agenda item

To consider the attached report.

Deborah Fenton, Service Manager, Housing Management and Home Ownership presented a report to the Select Committee regarding the impact of Covid-19 and the delivery of services relating to income delivery and asked the Select Committee to note the report.

She advised that the report set out the impact of Covid-19 on the collection of rent, in particular it highlighted the increase when compared with the same period in 2019.  The report also gave some insight into the impact on the income of individuals as indicated by the increase in Universal Credit claims. 

The report provided an overview of the measures being taken to support residents whilst also working to protect the rental income, therefore providing some certainty for the HRA account.

Incoming telephone calls

The emergence of Covid-19 and the lockdown in March of this year led to an understandable level of concern and worry for the residents of the Council, which cumulated in a significant increase in telephone calls, up by over 100% in March.  The analysis of calls pointed to many residents being concerned about their ability to pay their rent due to being furloughed or losing their jobs. A small number of people were confused regarding the Governments message around mortgage and credit card holidays, this led to the team diverting resources to cover the vast increase in telephone calls. Although the number of calls have dropped dramatically since the beginning of the Covid-19 outbreak, the volume of calls was not yet at a pre-Covid-19 level, this was impacting on the team’s ability to provide targeted services to those people who have levels of debt.

Universal Credit

The evidence highlighted that Covid-19 has had a significant impact on the income of the Councils’ residents and an increase in the numbers of applicants claiming Universal Credit, it should be noted that there was a delay of at least 5 weeks before an applicant receives their first Universal Credit payment, thereby increasing rent arrears in the short term. Claimant of Universal Credit can ask for a loan, but this loan would have to be paid back out of their Universal Credit payments over the next 12 months, thereby reducing the claimants Universal Credit claim for the next 12 months.

Managed Universal Credit Cases

Further to the increase in overall cases there had been an increase in the number of managed cases. Officers can request to manage payments on behalf of residents who were struggling with managing their Universal Credit payments, these were usually people with vulnerabilities. Additional support was being offered to all residents who were experiencing difficulties, this was in addition to the Council’s current responsibilities under the pre action protocol.

Overall Impact on rent arrears

Compared with income received at the same time last year the increase in arrears was as follows:

March              13%

April                 19%

May                 19%

This would suggest a levelling out of arrears which was positive given that lockdown restrictions were only just beginning to be lifted. The team were continuing to take a supportive approach towards residents in arrears, evictions and possession hearings have been suspended, however we were serving notices on residents who we assess as ‘won’t pay’ rather than ‘can’t pay’. Further action on these cases will take place as soon as the suspension was lifted and the Courts reopened.

The team were currently fully staffed and there were no immediate plans to increase staffing levels to aid the recovery of rent arrears, however this will be kept under review.

The Chairman thanked the Council for taking a sensitive approach in the recovery of rent arrears and asked if Universal Credit was paid weekly or monthly.

D Fenton replied that Universal Credit was paid on a monthly basis. She added that the Income Recovery Team would offer support to residents as it was important that residents would be able to maintain their tenancies.

The Chairman stated that if residents weren’t able to pay their rents due to the current climate they should be given every opportunity and as much help need to maintain their tenancies. He asked how were the Council going to deal with the residents that ‘won’t pay’.

D Fenton advised that Officers would continue to take a stern approach to the residents that ‘won’t pay’. Officers would refer residents to debt management agencies for example the Citizens Advice Bureau, whilst still trying to work with these residents to encourage them to pay their rent as the Council do not want to make people homeless.

Councillor D Plummer stated that the 5 week waiting period for the first payment of Universal Credit was a real struggle and although you can ask them for a loan you have to pay it back. In my opinion the Universal Credit system was designed with the best intentions but it doesn’t really work.

D Fenton advised that the 5 week or more wait for the Universal Credit payment contributed to residents getting into rent arrears but the Council were mindful of this and in tune with what our residents were telling us.

Councillor R Brookes asked if the Officer had a rough idea out of the residents in arrears how many of them were on a payment arrangement with the Council.

D Fenton advised that she didn’t have that data to hand but she would arrange for that to be circulated at a later date.