On the Edge is a joint report from the National Federation of ALMOs and the Association of Retained Council Housing. It shows that while the cost-of-living crisis has blown massive holes in all household budgets, it’s had a devastating impact on those on low incomes, on the disabled, on those with long-term health problems and those who rely on any kind of support from a welfare system that has been hollowed out over the last decade.

Our respondents were drawn from 11 councils and 17 council-owned management organisations, together managing close to 300,000 properties, so this is a substantial and representative sample. Four in five reported rising arrears and said the total number of their households owing rent had risen four per cent in the last year.

The total amount owed has risen by 11 per cent to over £60 million; the average amount owed by each household in arrears rose from £427 to £527, up 23 per cent – about an additional week’s rent. Income managers are very clear about the causes of these increases.

The welfare system is simply not fit for purpose. Though two-thirds of council tenants are in work, many are battling poverty. On average, around a third of households living in local authority homes qualify for housing benefit and a similar percentage rely on Universal Credit.

Research from the Joseph Rowntree Foundation shows conclusively that welfare payments are not enough to cover the essentials for anyone who qualifies for financial support.

Our income collection respondents are often the only human contact on offer when a tenant’s income runs out because their meagre budget has been tipped into the red

Already inadequate payments are cut at source by ‘deductions’ for bedroom tax, the benefit cap, and the presence of any non-dependent over-18s in the house. Most pernicious of all is the deduction for the ‘debt’ that vast numbers of Universal Credit recipients are forced into by the compulsory five-week wait for any kind of benefit after a successful claim.

The bedroom tax – the ‘under-occupancy charge’, to give it its euphemistic official title – is still hanging over the households that can least afford a rent hike. The strategy is estimated to have saved the government around £2.8 billion since 2013, but this is money taken from people who have few options for finding better paid work or finding somewhere else to live. Meanwhile lone parents with school-age children, the very group least able to increase their income, are the people most likely to feel the sting of the benefit cap.

Our income collection respondents are often the only human contact on offer when a tenant’s income runs out because their meagre budget has been tipped into the red. “If it was just the bedroom tax, then it would be an extra £12 a week,” one told us. “But when you factor in energy bills doubling and 19 per cent inflation on food, it’s another amount of money a tenant needs to find, compounded by the fact that it is not easy to downsize.”

Options are dwindling and unfillable gaps are opening up everywhere. The Discretionary Housing Payments pot is the money central government allocates to local authorities to support households affected by its welfare reform policies. It was cut by £40 million in 2022 and will be fixed at £100 million a year to March 2025. Most income managers told us this would not be enough; some said their pots were effectively empty by last October with half the financial year still to go. Another respondent told us current demand was already up 17 per cent year-on-year. Although councils do have separate hardship funds, their budgets are also being squeezed and there is no hope of making up the shortfall from this source.

Some simple changes would pull many back from the edge: stop paying Universal Credit in arrears – and putting the poor in debt from the outset; stipulate a minimum income below which UC payments must not drop; end the ‘deductions’ which push households towards destitution.

Another winter of hardship is on the way, and as one of our income collection managers said: “People just don’t have any money. They can’t buy food. They’re really struggling.”  There is already precious little scope to choose between eating and heating; now rent day is rapidly becoming yet another source of dread. Government needs to provide sufficient support for these families – and, indeed, for their landlords. It has become, quite simply, a matter of survival.

A version of his Viewpoint first appeared in Housing Executive, Issue 11, 2023, pp. 62-62.