Does LA have to inform L that T is receiving housing benefit?

#1
Dear Jeffrey,

In February 2013 I asked T if they had applied for Housing Benefit (HB) as they were experiencing problems with paying the rent. I was told by the tenant on that, and on several subsequent occasions, that they had applied but had not received anything yet. In April 2013 I served a Section 8 notice on the grounds of, among other things, continued non-payment of rent. The T took this to the a Housing Officer at the LA. By this time there was over 3 months of unpaid rent. The Housing Officer negotiated with me to hold off serving the Section 21 as the tenants had promised that by 6th July 2013 they would be up to date. Since then matters have got worse and the T now owes over 9 months rent. Section 21 has been served and the T has until 28th February 2015 to move to alternative accommodation.
I now find out that the T had been receiving HB since November 2013 i.e. 3 months before I first asked about it.
The LA's housing benefit procedures say that they will pay the rent directly to the L if there is more than 8 weeks rent unpaid. The LA tells me that they are under no obligation to tell the L that HB is being paid to the T because of Data Protection Act. The AST has a clause that states that the T must inform the L if they are receiving HB. However, if the T lies to the L about the HB then the L has no way of knowing that the T is receiving HB. Further, the L cannot apply to the LA for the rent to be paid directly to the L.

Apart from the issue that the LA were negligent in following their own procedures regarding payment of HB direct to the L in the case of there being more than 8 weeks of unpaid rent, it seems to me that the LA should notify the L when HB is being paid. Otherwise, as in this case, a deceitful T can just keep pocketing the HB and not paying rent.

The LA claim that the transaction is with the T and the L does not need to know. Well, I think that the L does need to be informed by the LA otherwise the L may never know that they can apply directly to LA for the HB to be paid to them.

The LA cannot claim to not know who the L is, as they need to see the AST to verify how much HB is to be paid.

Best regards
Jeremy
 

Jeffrey Shaw

Member
Staff member
#3
You say this (with my numbering, for ease of reference):

Apart from the issue that the LA were negligent in following their own procedures regarding payment of HB direct to the L in the case of there being more than 8 weeks of unpaid rent(1), it seems to me that the LA should notify the L when HB is being paid(2). Otherwise, as in this case, a deceitful T can just keep pocketing the HB and not paying rent.
The LA claim that the transaction is with the T(3) and the L does not need to know. Well, I think that the L does need to be informed by the LA otherwise the L may never know that they can apply directly to LA for the HB to be paid to them(4).
The LA cannot claim to not know who the L is, as they need to see the AST to verify how much HB is to be paid(5).

1. Is it their policy or statute that entitles L to direct payment in arrears cases?
2. But, whether or not they "should", I'm not aware of any obligation on their part.
3. Yes. The Letting agreement (between L and T) is quite separate from HB funding arrangements (between the Local Authority and T).
4. True, but I still don't see that the Local Authority have an obligation to L.
5. Do they need to see the AST, or do they rely only on T's claimed amount + whatever is the locally-applicable HB rate?
 
#4
Dear Jeffrey,

1. Is it their policy or statute that entitles L to direct payment in arrears cases?
I believe it is just their policy. Quote from a standard letter from LA to L
Housing Benefit entitlement for a tenant can be paid direct to you:​
¨ if we consider it to be in the tenant’s best interests or​
¨ where there is benefit due to a tenant who has left a property, in respect of rent arrears, up to the amount owing for that property.​
We will also pay you direct if:-​
¨ you are receiving direct payments of Income Support or Jobseekers Allowance due to the tenant, to meet rent arrears or​
¨ if we are satisfied that the tenant is in arrears of eight weeks or more with their rent and we consider that it is in the best interests of the tenant to do so.​
When we start to make payments direct, we will write to you to advise you how much will be paid and from what date.​

2. But, whether or not they "should", I'm not aware of any obligation on their part.
OK

3. Yes. The Letting agreement (between L and T) is quite separate from HB funding arrangements (between the Local Authority and T).
Is there no requirement by the LA to apply due diligence to ensure that fraud is not being perpetrated by the T? I would have thought that there is an obligation on the LA to check the audit trail that money issued for a specific purpose is actually being used for that purpose.

4. True, but I still don't see that the Local Authority have an obligation to L.
Again, I believe it is a policy. Quote from a standard letter from LA to L following issue of Section 21 to T
Please note that the Council will do all it can to support both landlords and tenants to sustain any assured shorthold tenancy​

5. Do they need to see the AST, or do they rely only on T's claimed amount + whatever is the locally-applicable HB rate?
The HB Team at the LA advised me that they do require to see the Key Details from the AST plus confirmation that the security deposit has been lodged appropriately

Best Regards
Jeremy
 

Jeffrey Shaw

Member
Staff member
#5
Re the "policy" issues: why not complain to either your Local Authority Councillor or the Local Government Ombudsman?
To me, it sounds rather like a case of 'maladministration'.