Good morning

Over recent months, I have been dealing with a growing number of cases where Universal Credit claimants are wrongly refused assistance with their housing costs element in situations involving family-owned or connected landlords. A recent case highlights several serious and recurring issues that members should be aware of.

Case Background and Merits

In this case, the claimant migrated to Universal Credit in March 2025. Before that, he had received Housing Benefit for nearly 20 years under a long-standing tenancy arrangement. Despite no material change in circumstances, Universal Credit refused to award housing costs. The sole basis for refusal was that the landlord was a company established by a close family member, so the arrangement couldn’t be commercial.

All too often, decision-making in these cases is driven by assumptions rather than evidence, with family involvement incorrectly treated as indicative of a “contrived” or “non-commercial” tenancy.

The legal position is clear:

  1. A tenancy does not become non-commercial simply because the landlord is a family member.
  2. The relevant test is whether there is a genuine liability to pay rent, supported by the facts.
  3. Longstanding arrangements, written agreements, and consistent payment history are all strong indicators of commerciality

In this case, the tenancy had existed for many years before Universal Credit was created; Housing Benefit had been paid on the same facts without issue; and Rent continued being paid to the landlord even after Universal Credit refused liability. Consequently, the conclusion reached by DWP should never have arisen.

Poor-Quality Decision-Making

One of the most concerning aspects of this and similar cases is the poor quality of initial decision-making and Mandatory Reconsideration (MR) handling.

Increasingly, it appears that:

  • Cases are assessed by staff without sufficient training in the relevant regulations and case law
  • Key evidence is overlooked or misunderstood
  • Incorrect factual assumptions underpin decision-making
  • Mandatory Reconsiderations fail to correct obvious errors

In practice, it is only when a case is escalated or more robustly challenged that a qualified Decision Maker becomes involved. At that point, the outcome often favours the claimant.

Delays, Appeals and Avoidable Hardship

Once an incorrect decision is made, the consequences are significant:

  • Claimants are left without support towards rent
  • Rent arrears begin to accrue
  • Landlords face ongoing rental losses and increased financial pressure from mortgage lenders

Even where appeals are lodged promptly, delays of many months are commonplace.

In this case:

  • An appeal was submitted in February 2026
  • The Department failed to comply with Tribunal Directions requiring a response by mid-May
  • Several months later, the appeal has still not progressed

The recurring theme across these cases is not the complexity of the law, but the failure in its proper application by inexperienced and under-trained staff.

Where cases are ultimately reviewed by experienced and properly trained Decision Makers, outcomes frequently change in favour of the claimant. I highlighted this in an earlier bulletin 

Until these matters are properly addressed, claimants and landlords will continue to face avoidable hardship caused by poor adjudication and the delayed correction of errors.

If you require more information on this topic or anything related, email bill@ucadvice.co.uk or call 07733 080 389.

Regards

Bill Irvine

UC Advice & Advocacy Ltd