Are bedroom tax arrears real?

Yesterday I released a post called “Informed Debate on HB legal issues” and ‘informed debate is a euphemism for oh sh*t we hadn’t thought of that! Today I ask for informed debate on arrears as I highlight an incredibly important issue with the bedroom tax – namely when are arrears actually arrears?

To explain imagine Mr Jones can’t pay his bedroom tax shortfall (the reasons are of no consequence.)  Mr Jones accrues arrears right?  Yes.  But what happens when Mr Jones appeals his bedroom tax decision? Still not following?

When a landlord takes possession action they issue a Notice of Seeking Possession or NSP which is a legal document and has to contain correct arrears amounts as well as having all the other ‘t’s crossed and ‘i’s dotted.  Yet if the landlord includes the bedroom tax shortfall as arrears then the NSP cannot be legally correct as the alleged bedroom tax arrears are being decided by another court, the tribunal. As such the actual arrears are not yet determined.

(a) So could or even should the district judge say on any arrears possession case taken legitimately by the landlord which involves bedroom tax ‘arrears’ that he has to adjourn the possession case as the arrears are not proven to be actual arrears and rather they are theoretical arrears?

(b) Would the district judge have any other option?

(c) I cannot see a position where a social landlord takes arrears cases for possession and does not include the ‘alleged’ bedroom tax arrears – the landlord can’t say £734.28 of ‘normal’ arrears plus a potential £250 of bedroom tax arrears in simple terms.

If there is validity in the above crude overview, which I suggest there is, then a nightmare scenario exists for the social landlord with regard to arrears and possession cases.

1. Even pre-existing arrears cases are affected if from April they include a bedroom tax shortfall element

2. The inveterate rent dodger – the tiny percentage of social tenants that arrears officers know pull every trick in the book to avoid possession – will use this aspect too.

3. Even if a DJ does afford possession in the first instance would a tenant then argue this is an eviction by oppression?

When you then look at and discover that the tribunal brochures say each formal appeal takes between 3 and 8 months to decide (and all indications are it is already longer than this) and the glut of bedroom tax appeals which adds to tribunals workloads will see this take longer. then the social landlord is faced with a massive arrears risk over the next year if a tenant appeals the bedroom tax.

When Lord Freud said that the bedroom tax will not hit social landlords bottom lines he clearly had not thought of this aspect – that arrears can be termed theoretical ones whilst an appeal is ongoing and social landlords will suffer significant financial loss over this.  It also highlights the ineptitude of the DWP estimating that 3% of social tenants will appeal and not a much higher figure that will happen.

Informed debate is needed yet this is just another critical matter that the DWP has not foreseen in its back of a fag packet bedroom tax policy.