1. FINANICAL INCLUSION & WELFARE REFORM Presentation by Sharon MacPherson & Robert Hinds

2. Programme Financial exclusion in Scotland – what are the facts? Welfare reform – what’s happening & when? Impact on your clients Group discussion Feedback Conclusion

3. Financial Inclusion – why is it important? No access to bank accounts and Direct Debit Lack of affordable credit Charging ATMs Cheque cashing/ payday loans/Cash pawnshops Increased insurance premiums Higher utility costs- fuel/ telephone Poverty Premium- £1,300 per annum

4. Financial inclusion – the facts SHS best indicator Key questions on financial circumstances - How households are managing financially - Savings and investments - Banking

5. How are households managing financially?

6. Savings & Investments

7. Banking %Up to £10k £10- 20K £20- 30k Over £30k 15% dep All Bank account 879094968292 BS account 121522321021 CU account 124443 PO account 111042147 None 311032

8. Welfare reform – What’s happening & when? Wide ranging reforms Focus on 5 key areas: Housing Benefit changes Social fund Tax Credits Universal Credit DLA / PIP

9. Housing Benefit changes April 2011: non dep deductions up by 27% April 2011: Local Housing Allowance Cases LHA: method by which HB is calculated in PS Removal of up to £15 weekly excess Max rent payable in LHA cases cut (50 th to 30th ) Removal of 5 bedroom rate (max now 4) Capping of LHA rates

10. Housing Benefit changes 2012 1 Jan 2012 (in private sector) - Shared room rate (bedsit rate) extended from single under 25 to single under 35 - Previous exemptions still apply - Additional exemptions but only for those aged 25 or over - Applies to new claimants as per 1 Jan 2012 straight away - Existing claimants have limited protection will all be moved over by end of 2012

11. Housing Benefit April 2012 - Non dep deductions increased by 21% - April 2013: Social Rented Sector - Entitlement for working age claimants reflect household size - 1 spare bedroom 14% reduction in rent allowed for HB - 2 or more spare 25% reduction apply

12. Social Fund From 2013 - Abolition of the discretionary social fund - CCG, CL replaced by local system - BS and CL alignment loans replaced by payments on account - Abolition of Social Fund Commissioner and the Independent Review Service

13. Tax Credits April 2012: - Backdating reduced from 3 to 1 month - 50 plus element removed from WTC - Introduction of £2,500 disregard - Increase in hrs per week couples with children must work to qualify from 16 to 24 - £40k second income threshold removed

14. Universal Credit Means tested benefit People of working age Replace IS, income based JSA, income related ESA, HB and both types of tax credits Paid monthly* Single payment* Claim online

15. Universal Credit APRIL 2012: limited pilot OCTOBER 2013: roll out for new claimants and some existing claimants migrated over APRIL 2014 – OCTOBER 2017: firstly migration for households who will benefit most and then by end of 2015 full scale migration to UC

16. Disability Living Allowance/PIP 2013 - Introduction of Personal Independence Payments as a replacement for DLA for working age claimants - Continue to be non means tested and non contributory - Paid in work or out of work (?) - Intention to cut claimants and budget by 20%

17. Disability Living Allowance/PIP New assessment tool similar to ESA Timetable APRIL 2013 – Introduction for new claimants Bootle Benefits Centre JUNE 2013 – Intro for new claimants across GB OCT 2013 – Limited migration of existing claimants JAN 2014 – End 2016 – Full scale migration exercise

18. HOW DO WE RESPOND?

19. FEEDBACK

20. CONCLUSIONS