Landlords will be forced by law to pass on the £400 energy rebate to tenants with all-inclusive bills, the government says.
Activist groups and some charities had raised concerns that tenants whose bills are included in their rent could miss out because the rebate is paid to their landlord
The government estimates around one per cent of households will not receive the £400 Energy Bills Support Scheme discount directly, and this includes those ‘bills included’ tenants.
A government statement says: “Additional funding will be made available so that £400 payments will be extended to include people such as park home residents and those tenants whose landlords pay for their energy via a commercial contract. The government is committed to ensuring such households receive the same support for their energy bills. The government will introduce legislation to make sure landlords pass the EBSS discount on to tenants who pay all-inclusive bills.”
However the National Residential Landlords Association says this demonises landlords.
Chris Norris, the association’s policy director, says: “Given payments under the support scheme have not begun to be made, the government’s plans to legislate are premature and are demonising landlords unnecessarily. It sends a dangerous and misleading message that landlords cannot be trusted to do the right thing, creating needless fear and anxiety for tenants.
“The reality is that one-off pots of money like this cannot compensate for the fact that the benefits system is systematically failing to protect the most vulnerable tenants. At a time when households finances are being squeezed it makes no sense to have frozen housing benefit rates.”
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The £400 is only a drop in the sea compare to the increase in energy bills for HMO landlords who provide all inclusive rents. How do you pass that on to tenants when you are trying not to increase the cost of rent to tenants who are struggling to pay at the moment? No doubt some of my tenants will be expecting a large cheque in the post as they will think they are entitled to this money not realising or even caring that it does a little too reduce the increase in the cost of energy.
In my area universal credit rates have not increased for years yet rents are rocketing. This will result in very few universal credit tenants being able to be housed in the private sector. There’s little concerned about this.
Jim Haliburton
The HMODaddy
Those who pay the bill should get the £400. If LLs of 'inclusive' properties have to pass it on surely rents will just go up to compensate - this is just political posturing?
£400 per household is such a blunt tool - someone in a 1 bed flat gets £400 & the LL of an 8 bed HMO gets £400 (or each tenant £50) - how is that fair?
I remember students complaining recently that they weren't entitled to a Council Tax rebate just because they were exempt from paying Council Tax.
It seems they didn't only want to use Council services for free, they wanted paid for using them!
It seems some tenants want paid to live in all inclusive accommodation. Hang on..... many ARE already being paid by the tax payer to do just that!
Problem is, the simple and easy to administer systems are always going to be unfair. To make it fair would be complex and require a lot more administration (and cost) ie employing armies of people to assess every household and decide what discount is fair. Just so glad I don't have any HMOs any more. If landlords have to pass on the £400 then they should also be able to pass on the increased energy cost, even if it's more than £400 (which I am sure it would be).
Last October the electric price cap was about 21p per kWh. This October it will be about 34p per kWh.
The gas price cap was about 4p per kWh. This winter it will be about 10.4p.
One of my fairly typical 4 person HMOs uses 3073kWhs of electric and 12464kWhs of gas.
That's £405 more for electric and £790 more for gas just based on price cap prices (which weren't what we were expecting to pay when we signed the tenancy agreements).
My 6 person HMO will be around £3800 at this years price cap compared with the £1569 I had expected to pay when I took out fixed contracts with companies that went bust.
Unlike utility companies we can only increase rent once a year and if the tenant thinks the increase we've proposed is excessive they can challenge it at a tribunal.
We've already absorbed huge amounts of the extra utility costs and the £400 is a small contribution towards that.
The cost of everything else has also increased - Council Tax, water, broadband, insurance, tradespeople, materials, etc. Mortgage rates have risen massively and any landlords reaching the end of a mortgage fix are going to have huge increases made a whole lot worse by Section 24.
I will pass on exactly the same amount as my tenants on benefits passed on to me when they got the first cost of living support payment
Touche
Ok. So I have an HMO with 15 separate tenants. I will get £400 off the bill, which isn’t even one months cost for either gas or electricity. I’ve put up rents to partly cover the 2.5 times increase that’s already happened, and hopefully the Truss actions will mean I don’t have to increase them again as the tenants can’t afford it - mainly due to the failure to increase housing benefits is line with the LHA rate. The 400 is already offset against this further increase, as is the cap. And if I have to pass the 400 on - whoopee that’s £26 each. How do I allocate that, when the accommodation units are all different sizes and have different rents? What do I do about vacant units, can I keep my £26 on them? What about tenants in arrears? Can I just deduct it from the arrears? What a load of nonsense.
It’s simple, the payment should go to the Bill payer, perhaps the Government don’t quite understand. But then you won’t get any common sense in Government or their departments.
Exactly, common sense must prevail in each case and there will be a whole mixed bag. There will be tenants who have benefitted from being stuck in a fixed term where the energy cap has gone up and the LL has had to pay the extra. If that has exceeded £400 then the LL should retain the £400, if less, the proportion thats relevant. If tenants have paid the full price for their utilities through their rent it should be passed on to them in full. The alternative of course is the rent goes up this time to market levels + £400, there are no free lunches for anyone.
Its no more complicated than working out that neither tenant or landlord should profit from the price changes one way or another. I suspect though there will be some tenants and lobbyists that will expect the £400 to be passed to all tenants regardless of the detail of the tenancy and who has paid what. As Paul implies, any prosecutions will be evidence led, so if landlords are confident they are justified in keeping some or all of the cash, then they will be able to without fear of reprisals. I imagine the legislation is designed to warn off the minority of shister landlords who plan to pull a fast one.
I suspect they can only enforce this when the tenant has a separate internal meter for their unit and is paying the landlord for their actual usage.
If landlords have to pay the £400 to HMO tenants then Landlords should be allowed to increase rents when energy costs go up.
We can already, at pretty much anytime, for any reason.
But we can only increase rents once a year, so potentially we will be out of pocket for months.
As a landlord I have little sympathy for landlords. Tenants in the situation described should get the £400. Can landlords be trusted to do the right thing for tenants ? Too many won't . It is a pity too that too many tenants are plain awful tenants.
Explain why the tenants should get the money again please. I've obviously missed something. Im all in favour of fairness but I pay the energy bills. My tenants are students. Although they are a friendship group, they all want different moving in and out dates so they have separate tenancy agreements and I pay all the bills. Some of them come from warm countries and tend to have the heating on much higher than I would. They don't have access to the meter because it's in the basement, although I am paying a lot of money to get it moved soon. Two years ago we had this problem and the meter readings were outside the energy company's tolerance level which seemed to make it impossible to get a proper reading. I kept getting bills that said "actual reading" when the reading was obviously an estimate. Eventually I dumped them. SEE in case anyone is interested. Then I got the bill. The students had racked up £5,000 in less than a year. I switched companies, got more frugal students and last year everything was fine. This year I have a new set of students and I am worried sick. If fuel prices double they could easily cost me £10000 in energy bills and then the government are going to give them a £400 reward and no help for me?
Michael - what exactly is the right thing for tenants in your opinion?
In the situation we were in last year signing up tenancies based on utility prices we had contracts for. Those utility companies went bust and the contracts weren't honoured. We were dumped on a range of equally horrendous utility companies on price cap tariffs which are significantly more expensive than the contracts we had signed up for and based our rents on. Legally we couldn't increase those rents while those tenancy agreements were in their fixed period. Unlike utility companies landlords are expected to adhere to the contracts they issue. So we have had best part of a year absorbing huge utility increases. The current price cap is more than double the contract rate we signed last summer for electric and 2.5 times for gas so we have already absorbed way more than £400 per property.
Clearly when the landlords are paying the energy Bills on a fixed Contract period, any energy increase is paid by landlords so therefore is entitled to the £400, help, why should the Tenants get it they didn’t incur the cost rise. I don’t know why the the subject was even raised. Different of course when Tenants pays the Bills then obviously they are entitled to it.
Michael- try not to use common sense in these forum topics it kills the debate dead
LL pays the energy bill against a preset rent. He then gets offered £400 quid from gov to offset the extra cost he has committed to when taking in the tenant. Drop in the ocean really as some of these tenants will find it funny to leave the window wide open heating on tele on and be down the pub & they think they should be getting it? Beggars belief
Oh and anyone that searches for ‘bills inc’ denotes that they cannot trust themselves with paying the bill, don’t want to pay what they incur, want someone else to be responsible and they will still moan about the costs
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