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DWP finally acts to end housing benefit 'maladministration' scandal DWP finally acts to end housing benefit 'maladministration' scandal
(about 4 hours later)
The work and pensions secretary, Iain Duncan Smith, has belatedly acted to end a bureaucratic bungle which caused thousands of sanctioned jobseekers to wrongly incur rent arrears and face eviction.The work and pensions secretary, Iain Duncan Smith, has belatedly acted to end a bureaucratic bungle which caused thousands of sanctioned jobseekers to wrongly incur rent arrears and face eviction.
Guidance slipped out by the DWP last week clarifies that local authorities should not automatically stop a claimant’s housing benefit payment in the event of them having their unemployment benefit stopped by job centre officials.Guidance slipped out by the DWP last week clarifies that local authorities should not automatically stop a claimant’s housing benefit payment in the event of them having their unemployment benefit stopped by job centre officials.
Campaigners have long highlighted the devastating financial ‘double-whammy’ effect on already impoverished claimants of both losing their dole payments and incorrectly having their rent payments discontinued.Campaigners have long highlighted the devastating financial ‘double-whammy’ effect on already impoverished claimants of both losing their dole payments and incorrectly having their rent payments discontinued.
The problems were caused by DWP computer systems wrongly informing local authority housing benefit departments that a claimant’s job seeker benefit had been cancelled when it had in fact been temporarily suspended.The problems were caused by DWP computer systems wrongly informing local authority housing benefit departments that a claimant’s job seeker benefit had been cancelled when it had in fact been temporarily suspended.
Sanctioned claimants were often not informed that their housing benefit had been cancelled, only becoming aware of their plight when their landlord told them they were hundreds of pounds in rent arrears.Sanctioned claimants were often not informed that their housing benefit had been cancelled, only becoming aware of their plight when their landlord told them they were hundreds of pounds in rent arrears.
Tenants, who were already struggling with the loss of a minimum of four weeks benefit income, were as a result often forced to turn to payday lenders, loan sharks and food banks to cope.Tenants, who were already struggling with the loss of a minimum of four weeks benefit income, were as a result often forced to turn to payday lenders, loan sharks and food banks to cope.
The government’s own review of sanctions carried out by economist Matthew Oakley in 2014 highlighted the problem and called on ministers to take action to stop the practice.The government’s own review of sanctions carried out by economist Matthew Oakley in 2014 highlighted the problem and called on ministers to take action to stop the practice.
Last week (and credit to Paul Anderson of Homeless Link who spotted it, and wrote about it here) the DWP sent out an “urgent bulletin” to local authorities which said:Last week (and credit to Paul Anderson of Homeless Link who spotted it, and wrote about it here) the DWP sent out an “urgent bulletin” to local authorities which said:
When a sanction is applied entitlement to benefits will continue but will not be payable for a fixed period of time. Claimants who are receiving passported HB should continue to do so without interruption when a sanction is applied … no action should be taken on the HB claim as a result of a sanction. Effectively the sanction notifications can be ignored/completed with no actionWhen a sanction is applied entitlement to benefits will continue but will not be payable for a fixed period of time. Claimants who are receiving passported HB should continue to do so without interruption when a sanction is applied … no action should be taken on the HB claim as a result of a sanction. Effectively the sanction notifications can be ignored/completed with no action
Anderson said:Anderson said:
We hope that these 361 words from the Government will have a big impact, and that many people will no longer have their Housing Benefit stopped incorrectly. If local authorities act on it as they should, it really could help thousands of people avoid unnecessary homelessness.We hope that these 361 words from the Government will have a big impact, and that many people will no longer have their Housing Benefit stopped incorrectly. If local authorities act on it as they should, it really could help thousands of people avoid unnecessary homelessness.
Research by the charity Homeless Link in 2013 found that over two-thirds of clients living in homeless services who had been sanctioned also saw their housing benefit interrupted as a result.Research by the charity Homeless Link in 2013 found that over two-thirds of clients living in homeless services who had been sanctioned also saw their housing benefit interrupted as a result.
Although the move does not ameliorate the punitive impact of the sanctions regime, it does seem aimed at preventing one of the regime’s crueller - and costlier - bureaucratic consequences.Although the move does not ameliorate the punitive impact of the sanctions regime, it does seem aimed at preventing one of the regime’s crueller - and costlier - bureaucratic consequences.
There’s a good account by landlord blogger Bill Irvine here of how the termination of housing benefit occurs, and the subsequent effect on landlords and tenants as they found themselves juggling with arrears running into thousands of pounds.There’s a good account by landlord blogger Bill Irvine here of how the termination of housing benefit occurs, and the subsequent effect on landlords and tenants as they found themselves juggling with arrears running into thousands of pounds.
In a separate post, Irvine writes:In a separate post, Irvine writes:
In thousands of cases, UK wide, HB was mistakenly being cancelled, resulting in, wholly avoidable rent arrears going through the roof, and tenants being subjected to the worry, anxiety and costs of repossession action, when the fault lay entirely at the doorstep of DWP systems and processes.In thousands of cases, UK wide, HB was mistakenly being cancelled, resulting in, wholly avoidable rent arrears going through the roof, and tenants being subjected to the worry, anxiety and costs of repossession action, when the fault lay entirely at the doorstep of DWP systems and processes.
It is extraordinary that the DWP has waited over a year since the Oakley review to issue this edict, given the weight of evidence of maladministration. It knew about the problem long before the review was commissioned.It is extraordinary that the DWP has waited over a year since the Oakley review to issue this edict, given the weight of evidence of maladministration. It knew about the problem long before the review was commissioned.
And strange (or possibly not) that the DWP (a little shamefaced at how long it has taken to rectify this scandal?) does not appear to have publicised the the guidance more widely.And strange (or possibly not) that the DWP (a little shamefaced at how long it has taken to rectify this scandal?) does not appear to have publicised the the guidance more widely.
Nonetheless, it seems - and this is not a sentence I write often - some good news has come out of the DWP.Nonetheless, it seems - and this is not a sentence I write often - some good news has come out of the DWP.
Update 6.30pm.
Since publication this afternoon, DWP has responded to the post. A spokesman said:
Housing Benefit claims should not be affected by a sanction and guidance to Local Authorities making this clear has been in place since 2010. After investigation we can find no evidence that an issue exists with our IT system and we have provided Local Authorities with updated guidance as an additional safeguard.
I would argue this misleadingly suggests the DWP has been on the problem all along. The earlier guidance was issued March 2010 under the Labour government. Reading that five year-old guidance, there is clearly no expectation that cancellation of housing benefit as a result of sanctions is, or will be, a significant problem.
Since then, campaigners (and landlords) have repeatedly raised this issue with DWP, and a formal review (Oakley) has reported which identifies it as a serious problem. It is surprising - negligent, you might argue - that fresh (“urgent” even) DWP guidance has has taken so long.
DWP says the cancellation issue is not caused by its IT system. But it does not explain how or why it occurs. In his blog, Homeless Link’s Paul Anderson notes that he has spoken to DWP about the “extent and exact nature” of the problem. He concludes:
It is still a mystery as to why so many Housing Benefit claims are affected when they should not be.
Which is, indeed, a mystery.