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Direct payments would harm credit ratings

A report published yesterday by Moody’s Investors Service said direct payments to tenants increases risks to landlords around rent arrears and voids, and that a change from the current situation, where social landlords receive housing benefit direct, would be ‘credit negative’.

The Department for Work and Pensions is currently trying to decide how to develop its new universal credit, in which all benefits including housing benefit are amalgamated into a single payment. The Welfare Reform Bill included a provision for the housing element of universal credit to go direct to a landlord in some circumstances, but the DWP has yet to make a final decision on whether the social sector will continue to receive benefits direct. Read More:

 

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