The authority’s Overview and Scrutiny Committee were told about the issues with the new benefits system as they received an update on the first year of operation of Beyond Housing.
The registered housing provider came into operation in October 2018 following a merger of Yorkshire Coast Homes (YCH), which managed approximately 4,500 properties along the North Yorkshire coast, and Teesside-based Coast & Country which had a stock of 10,500 homes, the majority in Redcar and Cleveland.
Bosses of the new organisation were quizzed by councillors on the impact Universal Credit was having on its tenants due to the five-week wait people face before getting payments.
Tracy O’Neill, the executive director of customers and communities at Beyond Housing, said the organisation has found itself helping 645 tenants migrate on to the new benefit.
She added that it was having an impact on people’s ability to pay their rent.
She said: “We have reviewed our whole approach to income management and developed a new policy and looked at our service offer so we are supporting customers through the transition period [on to Universal Credit].
“We have strengthened the numbers in our team and ensured that money management isn’t a specialist service in Beyond Housing but something that is just part and parcel of the advice that we give to customers when they start a tenancy.
“We are predicting that our rent arrears in general as a result of universal credit will rise to over £2 million in this financial year. Rent arrears in the borough of Scarborough is around £600,000 at the moment but as more and more people transition on to Universal Credit that will rise.”
The average amount owed in rent by Universal Credit claimants in the borough is around £479 compared to just £110 by people not in receipt of the benefit.
Rosemary Du Rose, the chief executive of Beyond Housing, added that some people were having Universal Credit appeals that were lasting more than a year, which was causing “a great deal of stress” to the tenants.
Mrs Du Rose added that Beyond Housing was in the process of compiling a five-year plan for the organisation and it would include a commitment to build 2,000 new homes over the period as well as investing millions of pounds in improving its existing properties, which would entail fitting showers and new roofs among other schemes.