Welfare benefit reform from housing benefit to universal credit
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Welfare Benefit Reform: From Housing Benefit to Universal Credit. Peter Meehan HB Adviser CIH Scotland/HSEU Edinburgh 20th March 2014 [email protected] Major HB Changes so far in 2013/14. Spare room subsidy restriction (bedroom tax) Benefit Cap (July/Sept 2013)

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Welfare benefit reform from housing benefit to universal credit

Welfare Benefit Reform:From Housing Benefit to Universal Credit

Peter Meehan

HB Adviser

CIH Scotland/HSEU


20th March 2014

[email protected]

Major hb changes so far in 2013 14
Major HB Changes so far in 2013/14

  • Spare room subsidy restriction (bedroom tax)

  • Benefit Cap (July/Sept 2013)

  • LHA rates continue to be restricted (CPI for 2013/14 and 1% annual increase limit from April 2014)

  • LHA Shared Accommodation Rate emerging as a real difficulty for under-35s

Emerging issues
Emerging issues

  • predicted increases in rent arrears have become a reality.

  • political debate on bedroom tax has heightened

  • Homeless families in TA holding out for correct size of permanent social sector housing?

  • DWP announced extra DHP funding midway through financial year

  • Scottish Government also announced extra funding midway through financial year to cover gap between DWP’s basic DHP allocation and DHP upper spending limit (basic allocation x 2.5)

  • First tier tribunal decisions now beginning to highlight perceived inadequacies in both policy and guidance.

  • Court of Appeal has rejected appeals that the reforms conflict with European Human Rights, that women have been unfairly discriminated against and that a disabled adult should have an extra bedroom on same terms as disabled children.

Options for claimants faced with cuts in housing benefit
Options for claimants faced with cuts in Housing Benefit

Make up shortfall from current income?

Take up paid employment?

Increase earnings to meet shortfall?

Downsize to smaller accommodation?

Apply for DHP?

Take in a Lodger?

Challenge decision to class a room as a bedroom?

Hb uc size criteria miscellaneous amendments regulations 2013
HB/UC (Size Criteria) (Miscellaneous Amendments) Regulations 2013

Criteria for extra bedroom for disabled child in HB includes requirement that the child be ‘entitled’ to DLA care component at higher or middle rate.

Criteria for extra bedroom for disabled child in UC includes requirement that the child be ‘in receipt’ of the DLA care component at the higher or middle rate

Pre 1996 loophole
Pre-1996 ‘loophole’ 2013

  • Any HB claims that have been running continuously, unbroken since before 1996 are exempt from under-occupation and any such deductions should be added back to the HB from April 2013.

  • DWP has amended the HB regulations from 3rd March 2014, closing the ‘loophole’ and re-introducing deductions for those who had qualified for the pre-1996 exemption (approx. 4,000 cases in Scotland)

Conditionality claimant commitment
Conditionality – Claimant Commitment 2013

For those out of work

For those already in work

Sanctions if failure to meet conditions

Conditionality roll out
Conditionality roll-out 2013

Jobseekers Agreement beginning to roll out now in advance of the full Claimant Commitment which will be a key condition for Universal Credit

Either meet conditions or JSA/UC standard element will be subject to sanction ( 4 week withdrawal of JSA for first period of non-compliance then 13 week withdrawal for second and subsequent periods)

Introduction of Community Work Placements

Sanction does not apply to HB or to housing element of Universal Credit

Jsa claimant commitment
JSA Claimant Commitment 2013

When someone makes a new claim for JSA or returns to JSA from the work programme they will attend an interview with a work coach.

At the interview they will agree a personal plan outlining what the claimant will do as part of their Claimant Commitment to give themselves the best chance of finding work.

Jsa claimant commitment contd
JSA Claimant Commitment (contd) 2013

This could include regular specific tasks and training opportunities.

The work coach will explain the penalties claimants could face for failing to meet their responsibilities to get into work

The plan will be reviewed regularly

Sanctions 2013

Number of Sanctions in 2013 - 860,000

4.35% of JSA claimants per month

One third are for failure to actively seek employment

One third are for failure to participate in work programme or training

One fifth are for failure to attend advisory interview

New appeal arrangements for social security benefits
New Appeal arrangements for Social Security benefits. 2013

Introduces a reconsideration stage before appeal can proceed to Tribunal Service

No time limit for reconsideration stage

Does not apply for HB ( which was scheduled to have been closed down for new claims from those of working age starting from October 2013)

Ministers considering introducing a charge for appeals

Single fraud investigation service
Single Fraud Investigation Service 2013

  • Staff Transfer mechanism to be finalised (Section38 of the Employee Relations Act 1999?)

  • Phase 1- a small number of sites in summer 2014 followed by evaluation

  • Phase 2- implementation to re-commence in October 2014 and run for further 18 months to March 2016 by which time transfer will be completed for all LAs.

  • Detailed discussions with sites are due to commence in May with Road Shows from April to May 2014 to explain all aspects of the transfer to LA representatives

Universal credit will replace
Universal 2013Credit will replace

JSA (income based)

ESA (income related)

Income Support

Child Tax Credit

Working Tax Credit

Housing Benefit

Universal credit will comprise
Universal Credit will comprise 2013

Standard Allowance element

Child Element

Child Care Costs element

Capability for Work element

Carer element

Housing cost element

Housing element what rent will be covered
Housing Element 2013What rent will be covered?

For private tenants the ‘housing costs element’ in Universal Credit will carry forward existing Local Housing Allowance provisions.

For council tenants and tenants of Registered Social Landlords ( including Housing Associations) the actual rent less any ineligible service charges, non-dependant deductions, restrictions or sanctions

Recent developments
Recent developments 2013

Universal Credit national roll out, originally scheduled to begin from October 2013, has been delayed.

A root and branch review of the whole Universal Credit development was carried out by new Director General, Howard Shiplee , against the background of a scathing report by National Audit Office.

HB for pensioners will remain in place for all claimants over 60 until at least financial year 2017/18 (delayed because the introduction of the Single Tier Pension brought forward to 2016).

Recent statement by ids on universal credit it development
Recent statement by IDS on Universal Credit IT development 2013

Change in IT strategy

Development of a ‘Digital’ solution

Testing during 2014 and 2015

End State Solution complete and ready by end of 2015

No new claims for JSA by end of 2016

Universal credit
Universal Credit 2013

  • UC is currently live in 9 Pathfinder areas.

  • Original 4 sites (Tameside, Oldham, Wigan and Warrington)

  • Hammersmith/Fulham went live from October 2013

  • Rugby and Inverness went live from November 2013

  • Bath/NE Somerset and Harrogate went live from February 2014

  • One final pathfinder, Flintshire, due to go live from April 2014

Uc pathfinder caseload data april to october 2013
UC Pathfinder caseload data 2013April to October 2013

  • Between April 2013 and 30th November 2013 a total of 3,610 single people had started on Universal Credit

  • On 30th November 3,200 claimants remained on UC

  • Male to female ratio 7:3

  • Majority of new claims (70%) under 25 (so how many have housing costs????)

  • So, with first year almost complete still small numbers of the easiest possible claims, mainly being processed manually using spread sheet technology

Uc roll out next steps in 2014
UC roll-out : next steps in 2014 2013

  • claimant scope will be expanded in the pathfinder sites to include couples and then families (when depending on ‘system’ readiness)

  • geography will be expanded to take in more of the North West of England using a flexible approach to sequencing, dependant on testing and learning

  • this will conclude investment in the pathfinders

Uc roll out 2014 15
UC roll-out : 2014/15 2013

  • build a core digital service that will deliver to 100 people initially, continuing progressive approach to test, learn and implement as programme is delivered

Uc roll out 2016
UC roll-out : 2016 2013

  • all areas will go live for new claims, with no new claims for existing benefits for those of working age by end of calendar year

  • some migration will start, with all existing claims to be transferred over to Universal Credit by the end of 2017 (with the exception of 700,000 sick and/or disabled who will remain on ESA and HB for foreseeable future)

Autumn statement 2013 and budget statement 2014
Autumn Statement 2013 and Budget Statement 2014 2013

An overall cap on the Welfare Benefit Budget (excluding expenditure on State Pensions, JSA and JSA/HB) with an initial budget adjustment for 2015/16 followed by an annual increase limit of no more than 1%.

No Housing Benefit/UC housing cost element for under 25 year olds?????