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Mobysoft Says Spring Budget Gives Rise to Complex Challenges for Tenants & Social Landlords

Manchester-based SaaS firm Mobysoft has responded to changes to state benefits announced in the government’s Spring budget.
Julie Lorraine

Manchester-based software as a service (SaaS) firm and provider of predictive analytics to the social housing sector Mobysoft has responded to changes to state benefits announced in the government’s Spring budget.

Social housing providers will be faced by more complex challenges following the announcement of sweeping amendments to state benefits by Chancellor Jeremy Hunt in yesterday’s Spring budget.

Changes to the provision of benefits coupled with increased scrutiny of those claiming benefits (which has seen the threshold for number of hours they must work to avoid facing sanctions lowered) will, according to Mobysoft research, increase the complexity of work social landlords must undertake.

The changes to benefit provision and eligibility criteria, designed to drive more people into work, means that greater numbers of social tenants will face uncertainty of income as ‘in-work benefits’ fluctuate depending on an individual’s employment status. As more people are set to experience ‘dynamic’ income that can change month to month, the level of those claiming top up benefits will likely increase, something which poses a significant challenge for social housing providers.

“The nature of low paid work means many will still rely on ‘top-up’ benefits. The system however is not geared up to accommodate this as is rent billed in advance weekly, yet wages are generally paid monthly in arrears and benefits are paid 4 weekly in arrears based on previous month’s salary.

“We know that tenants on ‘in-work benefits are 56% more likely to fall into arrears than those on full benefits. As such, an increase in changes in circumstances of tenants brings with it an increase in risks of arrears for social landlords.

“On average 31% of tenants that suddenly fall into arrears stay in arrears and do not self-correct for 16 weeks. This means that housing providers are facing a raft of more complex cases and an increase in caseload and time per case, such is the nature of dealing with people who have never been in debt before.

“Now, more than ever, social landlords now need to be much more focused on building relationships, offering support and signposting, and renegotiating payment arrangements. However, this requirement comes at a time when the sector is struggling with recruitment and retention, further compounding the complex challenges landlords face.”

Mobysoft strategic director, Julie Lorraine, said:

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