The impact of Welfare Reform, from the 2012 Act onwards, on the housing sector in Scotland is substantial. The impact has been most strongly felt by tenants and their landlords, with different kinds of impact in the private and social rented sectors. Scottish Government have taken steps to mitigate this impact, including through funding for Discretionary Housing Payments, but this cannot address the full impact of UK Government policy.
Reduction in availability of support for housing costs increases the risk of hardship or homelessness, and reduces the ability of individuals to seek out appropriate, sustainable accommodation to fit their needs. Scottish Government’s ambition for housing is of a housing system that works for everyone, the impact of welfare reform can therefore work against this ambition.
In the private rented sector the impact of the freeze on Local Housing Allowance has limited the availability of affordable accommodation in a number of areas in Scotland, forcing households to accept less suitable accommodation or to make substantial savings in their wider living costs.
In the social rented sector Universal Credit is having an impact on the ability of tenants to effectively pay their rents on time or in full, and although data quality is poor this appears to have led to a substantial increase in rent arrears amongst universal credit recipients. This leads to additional burdens on both landlords and tenants, administrative and financial.