At the time of writing, the government has just announced that it is extending its pilot schemes for universal credit by six months. On the one hand, this is an encouraging sign that the Department for Work and Pensions wants to get the right systems in place before the widespread adoption of direct payments to tenants, and it also gives housing providers additional time to get their own systems prepared for UC.
However, on the other hand, the six-month extension also illustrates how difficult the UC project is and how hard many tenants are finding it to manage their own finances. While government figures report an overall rent collection rate of 94 per cent among the 6,200 tenants taking part in the pilots, it also reported that more than 20 per cent of the tenants have had their direct payments switched back to their landlord after getting into arrears.
If further was needed, these figures clearly show how important revenue collection and arrears management will become when UC is introduced across the country; even a half percentage point increase in arrears represents a huge amount of money for most housing providers.
