JMB Chair, John Paul Maytum, commented that the report on rent collection trends presented to Monday’s board meeting made grim reading. Whilst praising the work of the JMB’s rent collection team, he said that the description of the hardship faced by many JMB tenants makes very grim reading.
Rent collection trends: Board up-date January 2014
1. Overall position
Rent collection remains good. Between 1.4.13 and 10.1.14, 99.6% of the rent charged had been collected. This figure includes money lost due to homes or garages being empty.
Rent loss due to empty garages is falling. In 2012/13 we were losing 1% of our possible income, it is now down to 0.3%.
Excluding the money lost due to empty homes and garages rent collection is a highly respectable 100.4%. This is actually stronger than last year, at this point in 2012/13 it was 99.9%.
Southwark’s current rent collection is 99.2%, which is also stronger than last year.
The average Southwark tenant has arrears of £680. for the JMB the figure is £28.27. The JMB benefits from a high number of residents who pay in advance- currently £133,452. If tenants in credit are excluded the average arrear is £153.
2. Benefit levels
The fundamental problem is that it is really difficult to live on the benefits the government provides. For a single person the weekly amount is £71.70 and for someone under 25 it is £56.80.
The JMB works hard to provide support to tenants in danger of being evicted. More tenants are at risk this year than last. In 2012/13 three tenants were evicted, in the first six months of 2013/14 two tenants have been evicted. In 2012/13 thirteen Possession Orders (court notice to tenants that they will be evicted if they do not start to make regular payments) were granted. Already in the first six months of 2013/14 eleven possession orders have been granted.
4. Acute mental anxiety
We have four tenants that we are very concerned may be vulnerable to self harm as a consequence of the effect benefit changes are having on their lives.
5. Food Banks
The JMB has helped fourteen tenants get access to food banks. Others may have made their own way there. Food banks are so over-subscribed that help they can give is very limited. Three days food can be given, a maximum of three times a year.
6. High arrears
We have nine tenants who owe us more than £2,500 each. The total amount owed by these nine tenants is £30,000. The profile is as follows:
- Tenant with highest arrear is due to be evicted this month
- Three tenants have defaulted on their possession order and are in danger of eviction
- Five tenants are keeping to the terms of their possession order, so their arrear is reducing
- One tenant has been declared bankrupt and rent re-payment terms are decided by the court.
- One tenant has an acute mental health problem. S/he will be moving to a smaller flat and this will help him/her manage their rent account.
7. Direct payments
Public and private landlords fear the introduction of the direct payment of housing benefit to tenants will reduce significantly rent collection. The press is reporting political arguments inside the government and major problems with IT implementation. We have no timetable for the introduction of direct payments. Even if the government manages to introduce direct payments in the forthcoming year, 2014/15, it will only be applied to new claimants and those renewing their claim rather than every claimant. So we think it safe to assume in the budget setting process that rent collection will be at least 98% (including void loss).
8. Discretionary Housing Benefit (DHB)
The Council’s administration of discretionary payments is very good and qualifying tenants are receiving payment promptly. DHB is time-limited and the issue is how long Southwark will be able to continue to pay this. At the present time we have 20 tenants receiving DHP.
9. Bedroom tax
Seventy-six JMB tenants have had their benefit reduced as a consequence of the bedroom tax. The average arrear for JMB tenants affected by the bedroom is a low £44.64 (with tenants who are in credit also included in this figure). The average arrear for a Southwark tenant affected by the bedroom tax is £986.
Some of the tenants affected are getting discretionary housing benefit to meet the shortfall. However this is a time limited benefit, so their problems are just being delayed. The JMB has helped eight tenants downsize since April 2013. The JMB and Southwark are running mutual exchange surgeries each Monday morning during January and we are targeting tenants who need to downsize.
Our Project Worker, Jane Mepham, has talked to sixteen tenants affected by the bedroom tax, but at the moment only four are prepared to consider moving- even to a new property. Most tenants want to try to ride out the changes.
Tenants who have been on housing benefit since 1996 should receive a repayment due to a loop-hole in the benefit regulations. The Government is saying that they will close this loop-hole.
10. New business start up/ self-employment
We have three tenants who the Job Centre has encouraged to sign away their right to Job Seekers Allowance and Housing Benefit, by offering one off payments of £2,000-£5,000 to become self-employed or start a new business. A one-off payment of £2,000-£5,000 is attractive to hard up tenants, but if they continue not to earn for a couple of months it is less than the Job Seekers Allowance and Housing Benefit they would have received.
11. Employment Support Allowance
Eight JMB tenants have been affected by the Government’s drive to get tenants off Employment Support Allowance (the old Incapacity Benefit). We are seeing tenants who have had their Employment Support Allowance withdrawn who we can’t imagine ever being well enough to hold down regular employment. The other problem is a six week gap between Employment Support Allowance being stopped and Job Seeker Allowance starting, leaving people with no money to live and pay the rent.
Trying to get tenants with mental health problems and/or with chaotic lifestyles to fulfill the requirements of the Job Centre and thereby stay on benefit has been a long term problem. However as the Job Centre is increasing its expectations of claimants and seems to be taking a harder line on applying Sanctions (suspension of benefit) the problem is becoming more acute. We have eight tenants whose benefit has been interrupted by the application of Sanctions.
13. Non-dependant charge
There continues to be a steep rise in the amount that adult children living at home are expected to make, if their parent (s), the tenant (s), are on benefit.
14. Multiple debt
Again this is a long term problem, but an increase in insecure and poorly work and a decrease in benefit entitlement are making this problem more acute.
The biggest problem is the accumulation of negative benefit changes affecting people of working age, such as the new requirement to make a contribution to the Community Charge out of people’s benefit.
15. Condensation/ mould growth
Another long term problem is the relationship between tenants struggling to pay their rent and heat their home, with an increased risk of condensation and mould growth problems. The problem has to be largely self-managed by the tenants wiping off condensation and following the advice given by the JMB’s Repair Team. However, the JMB wants to start and track where condensation is occurring and introduce follow up visits to check whether tenants are following our advice and whether the problem has been tackled. We will also be arranging another ‘How to get rid of condensation’ advice surgery.
16. Credit Union
The JMB continues to promote the use of the Credit Union. The response from our tenants seems positive. However, because signing-up is a private transaction we cannot track how many of our tenants are members.
17. Support Services
JMB residents benefit from access to effective specialist support. Southwark’s Rightfully Yours service helps tenants get the benefit they are entitled to. We pay for Southwark’s Sustain service to provide one to one support for vulnerable residents. Christians against Poverty and the Southern Housing Project also provide help to our residents.