Universal Credit
Universal Credit rolls many existing benefits into one payment. Below are some facts about the system.
Landlord Portal
The Landlord Portal is an online system that enables landlords to verify a tenant’s housing costs without having to go through the secure UC47 form process. It also allows them to request an alternative payment arrangement (APA) or managepayments to landlords if required.
The Landlord Portal is available to all housing associations and the latest statistics from the DWP state that over 95% of all landlords are now registered (as of December 2018).
The NHF and members of the National Welfare Reform Group regularly meet with DWP officials to discuss improvements to the Landlord Portal.
Alternative Payment Arrangements
Alternative Payment Arrangements (APAs) are available for claimants who would struggle to manage standard Universal Credit payment arrangements.
There are three types of APA available:
- Direct payment of the housing cost element to landlords (known as managed payments).
- Splitting of payment between members of a couple.
- More frequent payment of benefit.
Read the DWP’s guidance onAlternative Payment Arrangements
How do landlords request an APA?
The DWP should set up a managed payment for claimants if the following conditions are met:
- A claimant is in arrears with their rent for an amount equal to, or more than, two months of their rent.
- A claimant has continually underpaid their rent over a period of time, and they have accrued arrears of an amount equal to or more than one month’s rent.
Landlords with trusted partner status can request an APA through the Landlord Portal. If you do not have access to the Landlord Portal you can request it bycompleting a form on the government website.
Landlords can also use this form to inform the DWP of other reasons why a managed payment might be needed and you can now email APA requests to the DWP.
Arrears repayments
Landlords can request deductions from a claimant’s Universal Credit to repay existing rent arrears. You can do this through the APA form, when you are completing the APA application. Deductions will be a minimum of 10% and maximum of 20% of a claimant’s Universal Credit standard allowance.
Landlords cannot request the rate of deduction – the percentage deduction that applies in each case will depend on whether the claimant has any other deductions from their Universal Credit.
Data sharing
Housing associations will receive anotification letter when a tenant has made a claim for Universal Credit.
Landlords need to be told in advance who is moving onto Universal Credit, so they can better support tenants and prevent problems for those struggling with payments or in need of extra assistance to make their initial claim. We want to see ‘implicit consent’ restored and better use of the Landlord Portal for two-way communications between landlords and DWP. This is key to the success of managed migration.
Move to Universal Credit (formerly known as managed migration)
The next stage of Universal Credit rollout is the managed migration of claims from the legacy system.
In 2019, the Department for Work and Pensions (DWP) started a pilot, in Harrogate, on moving all remaining legacy benefit claimants to Universal Credit. This work was paused in 2020 due to the coronavirus pandemic response.
In 2022, the DWP announced their intention to resume the Move to Universal Credit process. This will involve moving the remaining, approximately, 2.6 million people on legacy benefits to the Universal Credit system between now and 2028.
The Move to Universal Credit process encompasses three ‘tracks’ of migration:
- Natural migration: When a legacy claimant experiences a change in circ*mstances they will need to make a new claim to Universal Credit. This process has been in place since the development of Universal Credit.
- Voluntary migration: Any legacy benefit claimant that would like to move to Universal Credit instead can make their own claim to migrate. Claimants are strongly advised to check their entitlement under both benefits as they may find themselves worse (or better) off under Universal Credit. If a claimant finds that they are worse off under Universal Credit, and they have voluntarily migrated, they will not be entitled to ‘Transitional Protection’ (see below for more information).
- Managed migration: For those claimants that haven’t naturally or voluntarily migrated to Universal Credit, the DWP will start the process of ‘managed’ migration (through the Move to UC programme). Under managed migration, claimants who find themselves worse off under Universal Credit will be entitled to Transitional Protection. Transitional Protection will protect a claimant’s income, at the same rate as their previous entitlement, through migration – provided their circ*mstances do not change during the process. Transitional Protection will gradually erode over time due to increases in Universal Credit elements, excluding childcare costs, and will stop altogether with certain changes of circ*mstance.
The DWP have committed to a discovery phase in the rollout of Move to Universal Credit. This ensures that small numbers of claimants are moved through managed migration at a time, enabling learning from the process. At present, the department has not committed to a timeline for the ongoing rollout programme.
In the November 2022 Autumn Statement, the DWP announced that Employment and Support Allowance claimants, without children, will not be moved through the managed migration process until at least 2028. The department is still committed to moving all other legacy benefit claimants onto Universal Credit by the end of 2024.
Help to Claim (formerly known as Universal Support)
Since April 2019, Citizens Advice have been managing a new 'Help to Claim' service to support people to claim Universal Credit. Citizens Advice have received funding from the DWP to run this service for 12 months.
The service includes a wider referral system with a ‘no wrong door’ policy and supports people to make a new claim and prepare for their first payment.
You can read more about Help to Claimor contact your local Citizens Advicefor more information about how the service works in your area.
53 week rent year
The Universal Credit Regulation covering housing costs specifies that tenants with weekly tenancies will have their Universal Credit entitlement calculated on a maximum of 52 weeks.
This means that every five or so years tenants will be charged rent on the basis of 53 weeks but will only be able to receive Universal Credit to cover 52 weeks. Tenants with monthly tenancies are not affected by this rule and the Universal Credit they receive will be based on the total rent charged for that year.
The NHF previously advised that tenants with rent-free weeks would not be affected. The DWP has clarified that this is not the case. The regulations were amended in 2014 to specify that the calculation for cases with rent-free weeks will be 52 minus the number of rent-free weeks. This will apply even in years where there are 53 rent weeks.
We have written to ministers setting out the impact this rule has on tenants and that the unfairness could be addressed by a very simple change to the Universal Credit to regulations. We have argued that it is neither realistic nor reasonable to expect the social housing sector to change all tenancies to monthly ones.
In 2020 the High Court ruled that formulae for converting weekly rents to a monthly value for the purposes of calculating Universal Credit entitlement are neither irrational nor unlawful. During the 2019/20 financial year tenants with weekly tenancies saw their Universal Credit claim calculated on the basis of 52 rather than 53 rent charges. The Court found that ‘the Universal Credit regulations were not intended or designed to reimburse a tenant for every penny she spends on housing costs, but were only intended to provide a contribution towards them’.
Evidence from the DWP included an explanation ‘that a number of alternative options had been considered. However, each option for a change of policy would need to be consistent with the aims of UC and be deliverable within the assessment period structure. Any change would require IT build requirements, additional expenditure and changes to regulations’. The DWP have also said that no decision had been made to make a change, although the matter remained under review as part of the ‘test and learn’ approach to UC.
Please see the case notes on the England and Wales High Court Decisions website for further details.
The NHF has long pressed government for changes to address the shortfall in Universal Credit compared to the rent charged. The next time this issue will become apparent is in the 2024/25 financial year. In the meantime, we will continue make the case to DWP that change is needed.
Understanding universal credit
For more information on how Universal Credit works, see the DWP'sUniversal Credit frequently asked questions. The DWP has also producedinformation on whatUniversal Credit means for landlordsandaguide for Universal Credit claimants with housing costs.
