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Forum Home  →  Discussion  →  Housing costs  →  Thread

Too complicated and confusing to account for 53 week rent years in UC awards

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Timothy Seaside
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flair - 07 January 2019 02:42 PM

HB Anorak’s understanding is spot on.
RSL’s receive 12 monthly amounts throughout the year and receive these every 4 weeks, therefore on one 4 weekly payment date nothing is received. The missing payment date can be worked out for each claimant based on their assessment period and the RSL’s DWP Schedule Payment dates.

This is the DWP equivalent of genius! It’s too confusing to accurately convert weekly rents to monthly. It’s better to do it to the nearest number of weeks in a year and then pay that nearly-monthly amount every four weeks, only not every four weeks - just 12/13 of them. Which means that UC payment years will creep back because they always start on the same day of the week (ours are a Friday). This seems to take care of the missing day (or days, in a leap year). Except that it will catch up again when the claim ends - and leave the claimant wondering why there’s a hole in their rent account.

So a couple of other points about this:-
1. I wonder if this is why we have to wait at least eight weeks before we get our first APA payment on new UC claims (e.g. one of my clients claimed UC 08/08/2018, and we got our first payment 12/10/2018)? Are they introducing the missed payment at the start, and then playing catch up? This would help them to avoid overpayments when a claim ends towards the end of the 12/13 cycle, so I’d grudgingly admit it makes some sense (but only in as much as it makes sense to take weekly payments, convert them to nearly monthly, then pay them four weekly for some of the year).
2. Nobody in my local authority realised we were being paid every four weeks until I looked into this today! And we’ve previously brought up the late APA issue with our partnership manager, etc., and nobody has been able to give us any answers, so I’m guessing they don’t know about it either.

And this brings us back to the underlying truth: it would be much simpler, and more accurate to get the weekly to monthly calculation right in the first place.

flair
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So a couple of other points about this:-
1. I wonder if this is why we have to wait at least eight weeks before we get our first APA payment on new UC claims (e.g. one of my clients claimed UC 08/08/2018, and we got our first payment 12/10/2018)? Are they introducing the missed payment at the start, and then playing catch up? This would help them to avoid overpayments when a claim ends towards the end of the 12/13 cycle, so I’d grudgingly admit it makes some sense (but only in as much as it makes sense to take weekly payments, convert them to nearly monthly, then pay them four weekly for some of the year).

‘IF’ payments are made correctly, then you shouldn’t have to wait 8 weeks on all new claims - in the example you have given above then you would have to, however if the client’s UC claim date had been 05/09/18, then their Housing Element would also be due to be paid to you on 12/10/18, as this would still be the 1st landlord payday after the claimant’s payday.

Unfortunately still doesn’t help with the weekly/monthly shortfall issue.

Gareth Morgan
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Timothy Seaside - 07 January 2019 03:44 PM

And this brings us back to the underlying truth: it would be much simpler, and more accurate to get the weekly to monthly calculation right in the first place.

Except that sadly some months are shorter than others.  UC periods follow their own rules for months that are shorter than 31 when dates of claim fall at the end of a month

(2) Each assessment period begins on the same day of each month except as follows–
(a) if the first date of entitlement falls on the 31st day of a month, each assessment period begins on the last day of the month; and
(b) if the first date of entitlement falls on the 29th or 30th day of a month, each assessment period begins on the 29th or 30th day of the month (as above) except in February when it begins on the 27th day or, in a leap year, the 28th day.

    The Universal Credit Regulations 2013 Regulation 21(2)

That means that there will be different numbers of days for which rent is payable within each month and, often, different rent-days when rent is due as well. Annualising rent and dividing by 12 would mean that different daily rates of rent would be paid in different months allowing some people to profit over short claims. 

Anathema!

 

Timothy Seaside
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Gareth Morgan - 07 January 2019 05:23 PM

That means that there will be different numbers of days for which rent is payable within each month and, often, different rent-days when rent is due as well. Annualising rent and dividing by 12 would mean that different daily rates of rent would be paid in different months allowing some people to profit over short claims.

Yes, but that’s also true of any other monthly payments - like monthly rents, salaries, and everything to do with UC. So what we’ve been discussing in this thread has been how to minimise the unfairness within that framework. And the main issue in this thread (the 53 “gales”) is actually down to an inaccurate way of converting weekly rents to monthly.

One way to deal with it might be to base the housing costs on the total rent due for the whole AP - i.e. calculate daily rent, and then multiply that by the number of days in the AP. It’s not overly complicated (especially for the DWP’s advanced computer system). But then you’d arguably be creating difficulties for claimants with monthly rents - because they’d find their February UC housing costs payment was short of what the landlord is expecting. And the allowances for UC are averaged out over the year. So it probably doesn’t work because a month in UC is not constant: 28,29,30, or 31 days, or 1/12th of a year or 1/12th of 52 weeks.

And again this comes back to the point that months (and even years) are fundamentally less fair than weeks because weeks are constant. Perhaps a radical new system of benefits calculated on a weekly basis would work? Or is it time to reform the calendar again?

 

Gareth Morgan
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Timothy Seaside - 08 January 2019 10:51 AM

Perhaps a radical new system of benefits calculated on a weekly basis would work?

Surely that wouldn’t be supported by anyone?

HB Anorak
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Gareth Morgan - 08 January 2019 10:56 AM
Timothy Seaside - 08 January 2019 10:51 AM

Perhaps a radical new system of benefits calculated on a weekly basis would work?

Surely that wouldn’t be supported by anyone?

Then you would have the mirror image of this problem and people would still moan.  When I was an LGO Investigator I dealt with a complaint by a monthly tenant who was convinced that HB was short-changing him by one or two days a year, because he only got 52 weeks’ HB.  He just couldn’t see that the last part week’s rent came with next week’s HB.  This was in the days when HB used the x 12 / 365 (or 366) x 7 method.  I had to show him how it worked over a period of several years beginning with Monday 1 January and ending Sunday 31 December.  Apart from coppers lost/gained by rounding, HB matched rent liability exactly.

Ironically, they then amended HB Reg 80 to convert monthly rents by the x12 / 52 method, which means that in HB monthly tenants currently gain a day or two’s windfall every year.

None of it has anything to do with 53 gales though.

shawn mach
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More from NHF via Inside Housing:

Hundreds of thousands of social housing tenants on Universal Credit are set to have their housing costs underpaid in the next financial year due to a quirk in the calendar which means 53 weekly rent payments will fall due.

The National Housing Federation (NHF) is currently at loggerheads with the Department for Work and Pensions (DWP) over the issue .....

More: https://www.insidehousing.co.uk/news/59865

Gareth Morgan
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I think that I’ve worked out the problem, from the perspective of the social landlords. Their rent years aren’t years!

They work, in the main, to a fixed first Monday in April year start. So their years are always an exact number of weeks. Normally that will be 52 but sometimes it will be 53. In other words their years will be either 364 days or 371 days (add 1 for leap years). With that confusing basis it’s easy to see that they can think they’ve lost a week’s rent when they haven’t.

Peter Turville
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Gareth Morgan - 25 January 2019 12:37 PM

I think that I’ve worked out the problem, from the perspective of the social landlords. Their rent years aren’t years!

With that confusing basis it’s easy to see that they can think they’ve lost a week’s rent when they haven’t.

What is more concerning is that social landlords still haven’t understood the nature of their ‘misunderstanding’. For once I might have sympathy for officials at Caxton Hse trying to explain why it is not a problem generated by UC.

Daphne
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The Universal Credit landlord engagement letters have been updated -

Removed information relating to the 53 week year and Universal Credit from the October 2018 landlord engagement newsletter.

But I don’t think they’ve replaced it with anything…

 

shawn mach
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From the Sun:

Renters who pay their landlords at the start of every week are set to miss out, according to the National Housing Federation (NHF) which represents more than 900 housing association landlords and managers.

This is because monthly Universal Credit payments are worked out based on 52 weeks in the year - but this year there will be 53 Mondays.

Catherine Ryder, head of policy at the NHF, has described it as a “really serious situation” and that this “whole mess is entirely avoidable”....

https://www.thesun.co.uk/money/8295081/universal-credit-payment-loophole-hundreds-thousands-renters/

Gareth Morgan
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Daphne - 28 January 2019 02:44 PM

The Universal Credit landlord engagement letters have been updated -

Removed information relating to the 53 week year and Universal Credit from the October 2018 landlord engagement newsletter.

But I don’t think they’ve replaced it with anything…

 

They’ve now removed the reference to what they’ve removed ?

Gareth Morgan
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shawn - 29 January 2019 10:13 AM

From the Sun:
Catherine Ryder, head of policy at the NHF, has described it as a “really serious situation” and that this “whole mess is entirely avoidable”....

I agree, although not because of what she’s talking about.

 

Gareth Morgan
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Peter Turville
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Gareth Morgan - 01 February 2019 08:29 AM

Hm, even though the government now agree with me, I still think I’m right.

https://www.parliament.uk/business/publications/written-questions-answers-statements/written-question/Commons/2019-01-23/211790/

Oh dear Gareth your credibility gone overnight (he says as he quietly deletes his own posts)..