Lord Freud: Welfare reforms will see more social housing tenants in work

Universal credit will help those on housing benefits to enter work by making them pay their own rent, Lord Freud has said.

Speaking at Housing 2012, the minister for welfare reform said that a ‘genuine barrier that stops people taking on work’ would be removed once those on benefits began to pay rent through the universal credit system.

‘I really do not believe there is a single person in this country who understands our benefit system in its entirety. What universal credit does is to bring these benefits together into a single payment, which reduces steadily as people earn money as they go into work,’ Freud said.

‘As those on benefits increase their hours and earnings, they know that they will be better off in work and doing more work,’ he added.

The system will begin next April in Lancashire and Cheshire, steadily increasing to a national level that will bring 8m households into universal credit.

Julia Unwin, chief executive of the Joseph Rowntree Foundation, said that the universal credit system would represent a great risk for social housing tenants and businesses.

‘There is of course room for widespread reform for a benefit system that has failed so many people. But asking very poor people, managing on very tight budgets, in a very weak labour market, to make these changes seems to me to be pretty high up on anyone’s risk register,’ Unwin said.