Scottish Government announces Covid-19 Tenant Grant Fund

The Scottish Government has announced a £10 million grant fund for tenants who have fallen behind on their rent because of the pandemic and are at risk of eviction.

SFHA had called for further support for tenants who are struggling to pay their rent and welcomes the announcement of the Tenant Grant Fund as a positive step in helping tenants most adversely affected by the pandemic.

The £10 million fund has been given to councils to provide grants for tenants who are struggling financially as a direct result of the pandemic, allowing them to reduce or pay off their rent arrears. The grants will be available to tenants in both the private and social rented sectors.

This is part of a package of measures available to local authorities to prevent homelessness, alongside Discretionary Housing Payments and advice on maximising income. The grants, available until the end of March 2022, also come on top of the Scottish Government’s £10 million Tenant Hardship Loan Fund.

Key points:

• Each local authority in Scotland will receive a one-off allocation, based on a distribution agreement with COSLA.
• Any grant awarded to a landlord will be a one-off award as there may be tax implications for the tenant
• The grant is to help prevent homelessness and sustain tenancies by directly reducing or paying off arrears where a tenant is in the social or private sector and has faced difficulties due to Coronavirus.
• Any arrears accrued before 23 March 2020 and after 9 August 2021 cannot be covered by this grant.

Purpose of the funding

The purpose of the Tenant Grant Fund is to mitigate the challenges experienced by tenants adversely impacted by the Covid restrictions introduced since March 2020. Local authorities are expected to use the fund to prevent homelessness and sustain tenancies by directly reducing, alleviating, or paying off rent arrears for social housing tenants or private rented sector tenants. The focus of the fund is to support those most at risk of homelessness, where tenancies can be saved through this type of intervention by:

• repayment of all arrears
• a contribution to the payment of arrears, and/or
• to reach a repayment agreement.

Although the fund can be used to support social or private tenants, there is a steer in the guidance for local authorities, suggesting that it will be particularly useful for private tenants, assuming that private landlords may have a lower ability to manage sustained rent arrears in the longer term.

Local discretion

Local authorities are expected to engage with landlords, including social housing providers to be assured that the relevant pre-action requirements have been followed and will use their discretion to determine as to whether a grant payment is appropriate in individual circumstances. They will also want to be assured that any arrears relate to financial difficulties caused by Covid-19 and can request information about previous rental payments. There is no formal application process for a tenant or landlord to use for the grant funding, but the guidance issued by the Scottish government provides a ‘toolkit’, with templates for correspondence between the authority, tenant, and landlord. Housing associations already work effectively with tenants to sustain tenancies and work in partnership with local authorities to prevent homelessness. This additional support will be welcomed to minimise the hardship social housing tenants have faced during the pandemic.

SFHA is working with COSLA on referral routes and will update members ASAP but, in the meantime, please contact your existing local authority contacts.