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The ARCH annual report for 2015-16 is now available to view.

 

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53-week rent year and Universal Credit 11/01/2019 Labelled as Scrutiny, Regulation, Tenants

A number of ARCH member councils have raised the issue of the 53-week year and the impact on Universal Credit entitlement for tenants and rent reductions required under the Welfare Reform & Work Act.

 

Most social landlords charge rent on a weekly basis with the weekly rent debited to the tenants rent account on the Monday of each week. In most years there are 52 Mondays in the financial year from 1 April to 31 March but every six to seven years 53 Mondays fall in a financial year and this will be the case in 2019/20. 

 

As the weekly rent debits are raised on Mondays this means that in those years the tenants' rent account will be debited with 53 week's rent and the HRA rent debit would "benefit" from an 'extra' week's rent in a financial year when there are 53 Mondays in a year. However, in reality tenants will pay their rent for that particular week at any time in that week as they are paid or receive their benefit entitlements, although the rent debit would be charged to the previous financial year.

 

A number of local authorities have raised the implications of the" 53-week rent year" in regard to the provisions of section 23 (1) of the Welfare Reform and Work Act 2016 and the interpretation of what is deemed "payable" in respect of the relevant year. As 2019/20 will be the last year of mandatory rent reductions under the Welfare Reform & Work Act, there is also a potential "knock-on" effect in regard to the new social rent policy which would limit annual rent increases from 2020/21 to a maximum of CPI + 1% on the previous year's rent.

 

The 53-week rent year also has implications for tenants in receipt of Universal Credit in that the UC regulations are based on monthly payments and do not recognise 53 weeks and as such without changes to the regulations or other financial assistance from government, affected tenants on Universal Credit could end up with a week's arrears at the end of the financial year, all other issues remaining unchanged. This is clearly inequitable.  

 

These matters have been raised with officials at both the Department of Work & Pensions (DWP) and the Ministry of Housing, Communities & Local Government and in the interim the LGA have issued the attached an advice note for local authorities.

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