Charities Warn of a Looming Rent Debt Crisis.

 

A coalition of UK housing and social justice charities have warned that increasing numbers of people living in rented accommodation are falling into arrears.

 

The Resolution Foundation estimate, in figures reported by the BBC, that 750,000 people fell behind with their rent in January, a rise of 450,000 on last year.

 

Research carried out by the Joseph Rowntree Foundation (JRF) in November last year found that families in the UK owed £400 million in rent arrears and that two and a half million households were fearful about not being able to pay their rent.

 

The JRF have now joined with other charities, including Crisis, Citizens Advice, the Money Advice Trust and Shelter to call on Chancellor Rishi Sunak to take action as he prepares his budget.

 

In a joint statement they highlight the fact that people living in rented housing, particular in the private sector, often work in parts of the economy that are ‘struggling due to the impact of the pandemic and are being pushed into rent arrears with no support at a time of continued uncertainty’.

 

In their joint statement the charities welcome action taken by the government to help ‘sustain tenancies in the short-term’, adding though that they do not ‘go far enough to adequately protect renters going forward’.

 

The problems caused by people being unable to work or losing their jobs due to the pandemic are something the charities cite as a major issue. Despite furlough 7.8% of UK renters were unemployed in September, this situation my well become worse as the Bank of England predicts unemployment could rise by 7.75% by the middle of this year.

 

The charities call on the government to ‘do the right thing this budget’, adding that the ‘longer the Chancellor waits to take action, the more rent debts will increase’.

 

They have put forward three recommendations for areas in which they want to see action taken in the budget next week. These are supporting renters in hard hit parts of the economy to keep their jobs by extending the furlough scheme, tackling high levels of rent arrears by improving funding for measures such as Discretionary Housing Payments, and providing security for renters by extending he ban on evictions.

 

Evictions from private rented accommodation have been identified as a major driver of homelessness. At the start of the pandemic the government ordered a pause to evictions during the first lockdown.

 

This protection was watered down in September last year and the amount of arrears renters can build up before being at risk of eviction was lowered from nine months to six. The current ban on evictions comes to a end on 31^st March and 300,000 renters who took part in the research said their landlords had already spoken to them about eviction.

 

Responding to the statement a government spokesperson told the BBC on Friday that they had ‘put households at the heart of our decision making throughout the pandemic’ and pointed to the £280 billion package of measures to keep people in work.

 

There is no question Chancellor Rishi Sunak faces some hard choices as he prepares the budget. Government borrowing has leapt to levels unimaginable only a year ago due to the pandemic and he will be under pressure to balance the books.

 

Against this must be offset the huge impact Covid-19 has had on wider society, pitching millions of families into financial uncertainty, keeping a roof over their heads is just one of many struggles they face.

 

The message from the coalition of charities led by the JRF is clear though, on the looming rent debt crisis he must ‘act now to avoid renters being scarred by debts they have no hope of clearing and a wave of people having to leave their homes in the weeks and months to come’.