Deposit and notice from tenant

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I have a 5 year plus tenant who has indicated he is moving on. I currently hold a months rent by way of a deposit.The tenant says that when the rent is due next week he will not be paying but that her deposit should be used for her rent for the forthcoming month - at which time he intends to vacate. Also the tenant has mentioned that he may not be ready to vacate until a week or two after her rent/ deposit payment period expires. He says she will pay weekly in advance for a week or two if need be. The reason given for the use of the depoisit held for his due rent is that he will need to pay his new landlord a month's rent up front. How do I stand on this scenario?
30/11/2011 00:00

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