Wales Co-operative Centre

Canolfan Cydweithredol Cymru

Posts Tagged ‘tenants

Research shows that 1 in 5 tenants have turned to doorstep lenders in the last year – #povertyinwales

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As universal welfare reforms roll out across Britain, Wales Co-operative Centre Financial Inclusion Project Manager Jocelle Lovell discusses the changes.

A recent survey has highlighted that in Wales nearly two fifths of private and portfolio landlords were not prepared for upcoming changes in Welfare benefits and the subsequent effect it may have on their rental income.

Startlingly, a separate pilot conducted by the Wales Co-operative Centre and Caerphilly County Borough Council suggests that private sector tenants are just as poorly informed and prepared as their landlords.

Welfare reform will affect the way that all claimants, including those currently receiving housing benefits, receive their payments. Each household will receive the benefits they are entitled to in one single payment that will be monthly in arrears

Many tenants of both private and social landlords will still say that they don’t pay rent as they have never been in receipt of the money and have never had to make a physical payment. There are also many tenants who are digitally excluded, and have no means of accessing the online services that will help them manage better or do not have the skills to do so.

Budgeting is an issue for tenants who are currently used to receiving payments on a weekly or fortnightly basis. Many tenants existing within a cash economy may soon find themselves in difficulty.

People who are already in or living close to the poverty line often don’t want the temptation of having the rent money in their pocket.  Most people faced with the choice of paying rent or feeding or clothing their children will ensure their children’s immediate needs are met first.

The Welfare Reform and Universal Credit changes will be rolled out over the next few years. It is our belief that if more resources are put into pro active methods of engagement with ‘at risk’ tenants now it would be far more effective and offer better value for money to the public purse that dealing with crisis intervention at a later date. Woman in front of house

Following a piece of work carried out in partnership with Caerphilly County Borough Council, early findings suggest that four out of five tenants are still unaware of exactly how the reforms will affect them. At least half of the tenants surveyed to date had no access to on-line facilities.

Working in partnership with staff from the local authority we were able to explain the effects of the reforms to each tenant.  Wherever possible, tenants were advised on applying for additional funding and referrals were made to other advice and support agencies in the area, including foodbanks. Of the tenants visited over half had struggled to pay bills such as rent and utilities and one in five had turned to door step lenders in the past year. Each of the tenants faced different challenges – paying bills, paying rent, buying food, or buying clothing for their children, but most were already struggling with their finances.

We need a range of solutions to meet the needs of different people.  Nobody should be forced into using a product or service that isn’t appropriate for them.

One of these solutions could be a Credit Union Rent Account as it offers peace of mind to the tenant that their rent will be paid and also removes the temptation to use the rent money to make up short falls elsewhere. Of the tenants visited 80% wanted to explore the idea of a Credit Union Rent Account as they felt it was the best way to protect their tenancy.

The Wales Co-operative Centre’s Tackling Homelessness through Financial Inclusion project is working with local authorities and landlords across Wales to promote this simple model.

In light of the changes to Welfare Reform and the cuts to public sector funding, there has never been a more important time for public, private and the third sectors to work more collaboratively in supporting people and tackling poverty.


Written by Mark Smith

October 30, 2013 at 8:30 am

Swansea partnership supports Credit Union Rent Account scheme

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It’s Co-operatives Fortnight and Co-operative Congress is only 48 hours away! It’s timely, therefore, to remember the role that credit unions play as community finance co-operatives. Our ‘Tackling Homelessness through Financial Inclusion’ project has been supporting a scheme that involves Swansea Council and the local credit union, offering customers a rent account, that will help people to manage their money in the face of challenges from Welfare Reform. Swansea Council has provided the following update…

The introduction of Universal Credit (UC) in October 2013 will mean that thousands of council tenants, who currently have their Housing Benefit paid directly into their Council Rent account, will have to manage paying their rent instead. Credit Unions have widely been promoted by the Government as a good way of supporting tenants through Welfare Reforms to manage their finances and ensure that their rent is paid. wallet DSC2089

Swansea Council has therefore joined up with Loans and Savings Abertawe (LASA) Credit Union to offer a scheme to support its tenants to pay their rent. The scheme also focuses on identifying and supporting tenants who may be facing financial difficulties as a result of Welfare Reform.

The scheme was initially developed to support tenants with the transition to direct rent payments under Universal Credit, however it was agreed that the scheme could also be used to support tenants affected by the introduction of the under-occupation rules which came into effect in April this year.

Since April, officers within the Rents Team have been working with new tenants at sign up to determine if this scheme is suitable for them. A special application pack has also been developed to explain the scheme and ensure that they understand how it will operate. This has included discussions with tenants who are affected by the under-occupations charge and who may be facing financial difficulties. The scheme has also been marketed in Open House, the newsletter for council tenants.

Whilst there has been some interest in the scheme to date, it is still early in terms of tenants adjusting to making the under-occupation shortfall payments. It is anticipated that as tenants assess their ability to manage the shortfall over the coming months, they may consider the CU rent account as an option. It is further anticipated that by growing the scheme slowly and working with the Credit Union to develop capacity, it will be ready to support those tenants, who in far greater numbers, will be affected by the roll out of Universal Credit.

Tomorrow (June 27th), Jocelle Lovell and Paul White of the Wales Co-operative Centre’s ‘Tackling Homelessness through Financial Inclusion’ (THFI) team will be running a fringe seminar at the Shelter Cymru conference ‘People & Homes 2013’ that is being held at the Swansea Marriott. For more details on their work, including the ‘THFI toolkit’ visit the Wales Co-operative Centre website.

Written by Mark Smith

June 26, 2013 at 9:33 am

Newport residents invited to participate in Co-operative Housing survey

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The Seren Group, which includes Charter Housing, is considering developing co-operative housing on part of the old Pirelli Factory site, just off Corporation Road in Maindee. Before the group moves forward with this idea, it housing photoneeds to find out whether Newport residents would be interested in living in co-operative housing. Seren is working with the Wales Co-operative Centre and the Chartered Institute of Housing to identify whether there is any demand for this form of housing in the City.

What is co-operative housing?

Co-operative housing is a form of housing where members (either tenants or owners) democratically control and manage their homes and play an active role in the life of the communities they live in. Co-operative housing is very common in other parts of Europe. There are a number of different types of co-operative housing, either for rent or for sale but they have one fundamental thing in common: they put democracy and community ownership at the heart of housing.

Some of the advantages of co-operative housing are:-

• An affordable form of home ownership

• A democratic and safe community

• Long term financing and security

• Flexible to meet occupiers needs

• Potential of shared benefits of communal energy

What is the plan for co-operative housing in Newport?

Seren’s plan for the old Pirelli site is to create a community of around 200 homes which will be a mix of homes for rent and to buy. The vision is of an ‘urban village’; bringing the community benefits of village life to the heart of the City. Seren would like to include an area of co-operative housing in this development, if there are enough people interested.

Why are we reaching out to you and what should you do next?

We are trying to find out whether you are interested in knowing more about the development of the Pirelli site and whether you are interested in being a part of the co-operative Seren wants to support on the site.

If you are interested in finding out more, please go online using this web address

You’ll be asked to answer a few questions about yourself, your family, your current housing situation and to provide your contact details.

We will then write to you with more information about co-operative housing and an invitation to attend an event to tell you more about Seren’s plan and the types of co-operative housing that may be possible.

If you have any questions about this matter, please contact Dave Palmer from the Wales Co-operative Centre on 029 2055 6169.

Thank you.


Money problems do not have to lead to homelessness

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Katija Dew

Katija Dew

Project aims to safeguard rent payments for vulnerable tenants

On International Credit Union Day (Thursday 18th October), Katija Dew, Programme Director for Financial Inclusion at the Wales Co-operative Centre, and Welsh Government Financial Inclusion Champion for Wales, looks at the potential effect of Universal Credit on vulnerable tenants and how a new project could utilise credit unions to safeguard rent payments.

With just under a year to go before Universal Credit is introduced it is fitting to use International Credit Union Day to look at some of the effects that financial exclusion has on citizens in Wales.  It is an opportunity to look at how schemes advocating responsible financial products can help safeguard tenants and vulnerable people in our society.

Universal Credit is due to start rolling out in October 2013 and it will have a huge impact on those  claiming benefits. The new system will replace the majority of individual payments including tax credits, income support, jobseekers allowance, housing benefits,  and some sickness or disability benefits. The approach is intended to simplify an existing system that most people agree is extremely complicated and its planned application raises issues around inclusion and vulnerability.

The payment will be made on a monthly basis to one person, irrespective of the number of people within the household that claim together. That recipient is then responsible for ensuring that the money paid for that month is used for family expenditure such as rent, fuel and heating, food and clothing.

Whilst this approach appears logical for the majority of households, there are a number of issues that could mean that benefits are not used to their best effect, so effectively reducing household income even further. ‘Financially excluded’ tenants, who may not be able to open a bank account or who may fear bank charges and manage by using cash find themselves paying more for day to day living. Those who don’t know how to manage their money well, or lack the financial education to prioritise debt effectively sometimes opt to use their benefits to pay debts on a perceived need basis  – for instance paying off a short term loan as the company is literally on the doorstep. As an example of other difficulties people may face; those living in an abusive relationship or other dependency problems may find that the family does not see the money they are supposed to live on.

Beyond the change to the method of benefit payment, there are very significant changes to eligibility for benefits and the level at which they are paid. There are already an increasing number of households who find that their benefits will not cover their rent. This poses a real risk of homelessness and hardship. When Universal Credit is introduced most people who have their rent paid directly by benefits will have to manage the payments themselves. If the recipients have debts, problems with using bank accounts or don’t understand how to manage their money well, this means that the rent may not be paid.

At the Wales Co-operative Centre, we are working to support those most at risk of eviction and homelessness due to problems with managing their money.

Our Tackling Homelessness through Financial Inclusion (THFI) project seeks to support vulnerable tenants through the administration of their benefit through a ‘Credit Union Rent Account’. The project has been running across Wales since October 2011, and is funded by the Oak Foundation and Welsh Government. Its aim is to develop a credit union rent account model where none exists within a local authority, and to promote the scheme to private landlords and tenants to maximise take up.

The Credit Union Rent Account process is simple – the tenant joins a credit union and instructs the Local Authority to pay the benefit into a rent account. The benefit is ring-fenced and paid to the landlord (who pays a small administration fee to the Credit Union). This helps the tenant budget and by becoming a member of the Credit Union they get access to the other products a Credit Union can offer, such as low-cost loans and savings accounts. The tenant still retains control of their benefit. The landlord benefits from a degree of assurance that housing benefit is being used to pay rent.

Bristol Credit Union has provided a rent account scheme since 2008. Bristol Credit Union Chief Executive, James Berry comments, “Our members are fully in control of their account, and landlords like the fact that they are notified of any changes a member makes to the account, in advance to the change taking place. Tenants also particularly appreciate having rent ring-fenced in a jam-jar account as it means they have less of a worry about making sure the rent is paid.” Welsh Credit Unions are working hard to develop ideas further to suit their localised needs. For instance Neath Port Talbot Credit Union has provided a rent account model for over two years. By becoming a member of the Credit Union, over 76% of tenants on this scheme now have loans with Neath Port Talbot Credit Union where otherwise they may approached a high interest loan provider.

There are clear benefits to introducing vulnerable benefit claimants to a credit union now, prior to the introduction of Universal Credit. Credit unions are developing budgeting accounts, known as ‘jam jar’ accounts, to help support vulnerable people to budget for priority debt – ring-fencing priority payments such as rent. This will help vulnerable people, who will receive housing benefit within a larger single payment, to prioritise the rent going forward. Action now to support innovative models such as the credit union rent account will help mitigate against the impact of Welfare Benefit Reform, but this action is needed quickly so that people are prepared for the changes.

Vulnerable people need not be financially excluded in Wales. With co-operation and communication between accountable financial institutions, local government and other stakeholders  we can ensure that our vulnerable and at risk citizens have the means to access responsible financial services and have the security of a home and food for their families.


Written by Ieuan Nash

October 18, 2012 at 1:35 pm

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