Of this, £9m was owed to housing associations – equivalent to a third of the total they spent on management the previous year. Councils were owed £25m, more than a quarter of their previous year's management spend.
Two-fifths of these arrears – £13.6m – arose because of unpaid housing benefit. For all Welsh social landlords, rent arrears had gone up 25% in the past three years, the commission found.
The report pointed out that sustaining lender confidence and repaying loans is difficult when arrears are high. Specialist associations "can experience considerable financial difficulties, even insolvency, because of high arrears," it added.
Money that could be usefully spent on improving stock is being lost
Andrew Wood, lead manager, Audit Commission Wales
Andrew Wood, lead manager for the Audit Commission Wales, said: "A considerable amount, which could be usefully spent on improving the housing stock, is lost as councils and housing associations fail to collect £34m in rents."
Benefit processing times have improved, but the commission found it was still taking eight weeks on average to process claims. Delays had been caused by new IT systems or implementing the verification framework.
The commission called for this framework to be re-evaluated and for a single housing benefit to be introduced for social housing tenants. "This would bring council and housing association benefit payment cycles into line, improving the cash flow and reducing the arrears of housing associations," it said.
Source
Housing Today
Postscript
Get a copy of Rent Arrears and Housing Benefit in the Welsh Social Rented Sector by calling 0800 502030
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