The Audit Commission has launched a secret investigation into the rising tide of housing association rent arrears in England and Wales
It is understood that the increase in arrears to around £200m in 2000/01 caused such concern in government circles that the commission quietly launched a year-long inquiry in April.

Audit Commission associate director Greg Birdseye, who is heading the inquiry, said: "There's little doubt that rent arrears are causing financial problems for some housing associations. It affects their cashflow and restricts their ability to carry out repairs.

"We are studying the work of 400 larger ones to establish the exact reasons for rent arrears and the best ways to reduce them."

Birdseye added that up to 80% of housing association tenants claimed housing benefit and some of the arrears were linked to this.

The disclosure came just weeks after the minister for work and pensions, Andrew Smith, announced far-reaching reforms to the administration of housing benefit in order to encourage council tenants to seek better-value housing.

We are studying associations to establish the reasons for rent arrears and how to reduce them

Greg Birdseye, Audit Commission

The Housing Corporation said the inquiry was timely in the wake of this announcement.

Michelle Walsh, the corporation's head of housing policy, said: "We know many associations have problems with housing benefit payments because the administration of the system is complex and unwieldy and payments can be slow coming in. We are keen to see reform and simplification of the whole process."

The Audit Commission says it is able to conduct its inquiry prior to assuming its formal inspection responsibilities next February, as existing housing legislation allows it to carry out periodic studies for the Housing Corporation.

Source

Housing Today