Welfare Reform Jacqueline Cameron Area Housing Manager 27 June 2013

Welfare Reforms Areas of discussion:  Under occupation – the social sector size criteria – 1 st April 2013  Benefit Cap – 15 th July 2013  Scottish Welfare Fund taken over by local authorities – 1 st April 2013

Scottish Welfare Fund

 1 April 2013 to 31 March 2015 interim scheme  Replaces DWP discretionary social fund  Community Care Grants  Crisis Loans for general living expenses  Scottish Government scheme  National guidance & national application form  Crisis Grants  Community Care Grants  Grants not loans & to meet one off needs  Administered by the Council / Benefits Service  Demand expected to exceed supply

Cash limited funding DWP expenditure 2011/12:  CCGs - £615,000  Crisis Loans - £248,000  Total £863,800 Scottish Government Funding:  CCGs - £705,972 (£58,831)  Crisis Payments - £362,552 (£30,212)  Total £1,068,524  24% increase in funding  Managed monthly budget to cover the whole year  Can move money between the two funds

Scottish Welfare Fund Team Benefits Team Leader Scottish Welfare Fund Officer Senior Scottish Welfare Fund Officer Customer contact centre

Crisis Grants  Provide a safety net in a disaster or emergency, when there is an immediate threat to health or safety:  immediate short-term living expenses needed until their next income is due because of an emergency, or  living expenses or items where the need for them has arisen because of a disaster.  Need must be current  Disasters are events of great or sudden misfortune:  Flood / Fire  Emergency which needs immediate action:  A breakdown of relationships within the family / domestic violence  Travel expenses

Community Care Grants  Enable independent living or continued independent living, preventing the need for institutional care.  Establishing in the community after being in care.  At risk of going into care.  Part of a family under exceptional pressure.  Setting up home as part of a planned programme of resettlement, following a period in which you have been without a settled way of life.  Helping to care for a prisoner or young offender on release on temporary licence.  Travel expenses

Eligibility criteria Applicant must be aged 16 or over and in receipt of:  Income support;  Jobseekers Allowance;  Income related Employment & Support Allowance;  Savings Pension Credit;  Guaranteed Pension Credit;  Payment on account of any of the above  Council can make exceptions to qualifying benefits  For example leaving an institution or a gap in income due to a change in circumstances  A claim for both grants is permissible  No limit on number applications made / No award same items if 28 days since last claim

Stages to a grant 1.Initial eligibility checks 2.Meeting the requirements of the grant. 3.Needs are of sufficient priority:  First according to the nature, extent, severity and urgency of the need and the impact that an award & items requested would have on the circumstances of the applicant.  Second according to the vulnerability of the applicant and the likely consequences of refusal. Priority status  high - need is immediate and severe, highly vulnerable, an award will have a substantial or immediate sustained effect  medium - need less immediate or severe, moderately vulnerable, an award for will have a noticeable effect  low - need is not time critical, have a degree of personal resilience, an award will have only a minor effect 4. Priority of payments & sufficient money in the budget.

Processing targets Scottish Government processing targets:  Crisis Payment - 2 Working days  Community Care Grant - 15 Working days  Excludes bank holidays  Date completed application received to decision made

Payment of grants Crisis Grants  PayPoint Voucher – letter / / text / printed in office  53 outlets in North Ayrshire – good opening hours  Voucher redeemed in store  Cash or utility top-ups or both Community Care Grants  Furnishing Services Limited  Basic starter pack  Furniture (settee, armchair, carpets, curtains, wardrobe)  Household equipment / white goods (cooker, fridge, washing machine, bed, bedding, clothing)  Clothing for former prisoners – Primark store card Travel expenses – bus voucher provided / taxi fares (last resort) North Ayrshire Foodbank - voucher system for food packs

Appeals - first tier reviews First tier review Example of appeal – applicant not agreeing that the support they have received is appropriate to their needs:  In writing / Reason for review / Date of decision to be reviewed  20 working days of the original decision  Signed by the applicant.  No attendance at review Decision maker  Senior benefits officer independent of decision will review the case  Outcome notified in writing Performance targets  Crisis Grant review concluded in two working days.  Community Care Grant review concluded in 15 working days.

Appeals - second tier reviews Second tier review  Request within 20 working days of first tier review decision letter.  In writing / Reason for review / Date of decision to be reviewed  No attendance at review Review panel  Senior staff in Finance & Property will review the case.  Minimum of 3 staff / Chair casting vote Performance targets second tier  Crisis Grant review concluded in 5 working days.  Community Care Grant review concluded in 30 working days.

Position at 2 June 2013 Crisis Grants:  514 applications  294 awards  £14,402 paid  £53,639 cumulative budget  £49 average payment  No stage 1 or 2 reviews Community Care Grants:  274 applications  142 awards  £66,443 paid  £117,991 cumulative budget  £468 average payment  7 stage 1 reviews  No stage 2 reviews

DWP - Social Fund Reform Changes  Summary of Social Fund Reform Changes Social Fund to 31 March 2013 From 1 April 2013  Funeral Payments Continuing  Sure Start Maternity Grants Continuing  Cold Weather Payments Continuing  Winter Fuel Payments Continuing  Budgeting Loans Continuing for current benefits – Budgeting Advances will be available if in receipt of Universal Credit  Short Term Benefit Advances Introduced from 1 April 2013 delivered by DWP will replace Interim Payments and Social Fund Crisis Loan alignment payments  Universal Credit Advances Introduced from 29 April 2013 – Pathfinder site  Community Care Grants Abolished  Crisis Loans Abolished  Interim Payments Abolished  Crisis Loans for alignment to benefit Abolished  Social Fund Commissioner Abolished  Independent Review Service Closed

Partnership working Scottish Welfare Fund Team Customer contact centre Social Services Housing Services Partners

Under Occupation The social sector size criteria

What is under occupancy?  Size criteria for social sector tenants  Applies to working age tenants (under Pension Credit qualifying age)  Sees a reduction in Housing Benefit of:  14% if under occupied by 1 bedroom  25% if under occupied by 2 or more bedrooms  Reduction is of full rent charge, regardless of the level of HB the person receives

Who is entitled to a room?  Each adult couple  Any other person aged 16 or over  Two children of the same sex under the age of 16  Two children under the age of 10, regardless of their sex  Any other child  A overnight carer for claimant or partner, who does not normally live in household

Exemptions  Severely disabled children unable to share a room  Approved foster & kinship carers – 1 additional room  Adult children in the Armed Forces  52 week protection on death of a ‘linked person’  13 week grace period if no HB claim for 1 year

Impact on Tenants  Increased gap between rent and benefit to be paid (£9.40 to £17.00)  Some tenants paying rent for the first time  Increased financial hardship and debt  Disruption to family life  More pressure on non-deps to contribute - possible family tensions?  Impact on educational attainment  Households pushed into private sector?  Tenants want to remain in property but may need to consider:  Moving to smaller accommodation (mutual exchange, NAHR application)  Taking in a lodger  Moving into work or working more hours

Waiting List Applicants  Current allocation policy more generous than under-occupation criteria  Lack of 1-bedroom accommodation for single applicants (across all landlords)  Applicants need to weigh up housing need against affordability  Increase in numbers of housing applications  More housing options advice needed

The Benefit Cap

What is the cap?  Benefit cap for working age claimants  Effective from 15 July 2013 in North Ayrshire  Set at an average of net earnings for working households  £500 p/w for lone parents or couples without children (£26,000 per annum)  £350 p/w for single people without children (£18,200 per annum)  Housing Benefit is reduced where total welfare benefits exceed the cap

Benefits affected  Income Support  Jobseeker’s Allowance  Incapacity Benefit  Employment Support Allowance (unless receives Support component)  Child Benefit  Child Tax Credit  Housing Benefit  Bereavement Allowance  Carer’s Allowance  Guardian’s Allowance  Maternity Allowance  Severe Disablement Allowance  Widowed Parent’s Allowance

Exemptions Not affected if anyone in the ‘household*’ qualifies for Working Tax Credit, or receives:  Disability Living Allowance  Personal Independence Payment  Attendance Allowance  Industrial Injuries Benefits  Employment Support Allowance (if receiving Support component)  War Widow’s / Widower’s Pension If someone has worked continuously for 6 months, the Benefit Cap will not be applied for a period of 39 weeks. *The ‘household’ does not include non-dependants.

Impact of Changes - North Ayrshire

Under Occupation Concerns  2,387 tenants currently affected  1,947 (82%) under occupying by 1 bedroom  440 (18%) under occupying by 2 or more bedrooms  779 tenants in rent arrears prior to 1 April 2013  1648 tenants in arrears at 23 June 2013  Arrears have increased approx £111.5k in 3 months  Total estimated rent shortfall for Council:  £1.4m per year  Temporary Accommodation - £260,190 income reduction/arrears

Alternative accommodation?  Limitations in stock will make it difficult to offer alternative housing options as only 11% of the Council’s mainstream stock is 1 bedroom properties  During 2011/12 only bedroom council properties became available for let.  If all one-bed re-lets were made exclusively available to those under-occupying by 1 bedroom seeking to downsize the process would take 13 years.

Impact on NAC  Rent arrears initially forecast to increase by £514,000 in 13/14  Increased demand for smaller properties  Low demand for larger properties  Increased costs of collecting rent and managing arrears  Increased arrears caseload  Increase in number of housing, mutual exchange and lodger applications  Increased demand for support services e.g. debt advice, homeless

Benefit Cap Concerns  54 households affected at last DWP scan, mostly in temporary accommodation  Average benefit reduction £43.19 per week  Impact on Temporary Accommodation  NAC Temp Furnished £286pw  Hostel Room - £146.18pw  Snapshot of cases – if temp furnished rents reduced to allow for benefit cap - £140,000 per annum lost income to homeless service  Options - rent reduced or service provision reduced

Welfare Reform – Key Business Risk  Increased arrears a threat to Housing Revenue Account 30 year Business Plan which aims to:-  Deliver 500 new council houses over 10 years  Deliver Improvements to Council Houses  Meet the Scottish Housing Quality Standard  Invest in sheltered housing complexes  Risk to current Homeless Service Provision  Impact on tenants