Top

Top

Agenda Item No 6

 

The Vale of Glamorgan Council

 

Audit Committee: 26 November 2013

 

Report of Director of Resources

 

Welfare Reform - Progress Report

 

Purpose of the Report

1.         To update members on the work undertaken by the Council in implementation of the UK Government’s welfare reform agenda.

Recommendation

That the report is noted

Reason for the Recommendation

To ensure that members are updated

 

Background

2.         The final report of the scrutiny task and finish group was presented to Scrutiny Committee (Corporate Resources) on 23 April 2013.  The report was referred to Cabinet and the report and recommendations were endorsed by Cabinet on 8th May 2013. 

3.         The recommendations of the Task and finish group were as follows -  

(a)       The Officer Working Group considers how services can be best coordinated to provide appropriate advice services and signposting for claimants, including hard to reach groups, in liaison with libraries, leisure, town and community councils.

(b)       Communications on the implications of Welfare Reform to continue to be managed by the Officer Working Group via the communications plan, including the use of social media, C1V, local radio and the Council's web site.

(c)        Further road shows are used to communicate welfare reforms with affected claimants and tenants

(d)       Members and officers are given updates on Welfare Reform as further developments require.

(e)       The benefits service continues to monitor data on over accommodation (size restriction) and liaise with social landlords (including the Council’s Housing Service) and tenants.  

(f)        The Officer Working Group continues to plan and respond to Welfare Reform changes as they develop.

(g)       Action plans continue to be used to manage the risk and implementation of Welfare Reform and are monitored by the Officer Working Group and the Corporate Risk Management Group under the corporate risk management policy until the major reforms are implemented.

(h)       The Stakeholder Group continues to ensure the there is a coordinated approach to Welfare Reform with all LSB partners in the Vale of Glamorgan.

(i)         A revised Discretionary Housing Payment (DHP) policy is developed for approval by Cabinet.

(j)         The issue of the Localised Support Services for claimants is taken forward via the Stakeholder Group with involvement of Officer Working Group and any framework agreement entered into for Localised Support Services is approved by Cabinet.

(k)        The Council identifies and adopts best practice in the administration of Welfare Reform.

(l)         Cabinet considers designating the Social Services Department as lead department in dealing with the implications of the Discretionary Assistance Fund and the change from Disability Living Allowance to the Personal Independence Payment.

(m)      Cabinet considers designating the housing service as the lead department in dealing with implications of Welfare Reform on the management of the Council's own housing provision and the implications for overarching housing services.

(n)       The local housing strategy and the housing asset management plans are reviewed and considered by Cabinet in the light of the impact of Welfare Reform on the enabling function and stock profile.

(o)       Where policy decisions are required in relation to Welfare Reform, this is reported to Cabinet.

(p)       The Head of Financial Services updates the Change Forum of staffing issues associated with Welfare Reform as the situation becomes clearer.

(q)       Staff within Resources and Benefits are kept informed of issues by the Head of Financial Services in team briefings, with the staff newsletter and the core brief.

(r)        Future staffing implications are identified by the Head of Financial Services, included in the Council’s Workforce Plan and dealt with in accordance with Council HR policies as Welfare Reform develops.

(s)        As the financial year progresses expenditure on council tax support in included in financial monitoring reports to Scrutiny Committee (Corporate Resources).

(t)         The impact of the revised DHP policy and increased funding is monitored and reported to Scrutiny Committee (Housing and Public Protection) initially on a six monthly basis.

(u)       That the Scrutiny Committee (Corporate Resources) receives a report on the impact of welfare reform within the Vale of Glamorgan initially on a six monthly basis.

 

Relevant Issues and Options

4.         Given the fluid nature of Welfare Reform, the task and finish report reflected the position at the cut-off date of 31 March 2013.  This report provides an update on position at the 30 October 2013.

5.         The Officer Working Group currently meets on a monthly basis to co-ordinate work within the Council. The Stakeholder Group continues to work with outside organisations and local DWP officers to implement Welfare Reforms.  The action plans are continuously updated and the risk assessment is revised in line with the requirements of the corporate risk management group. Regular liaison meetings take place with landlords to discuss the Welfare Reform implications. Four road shows were organised by the Welfare Reform Group, the last of which took place in May 2013.  The Benefit Section and Housing Service continue to attend road shows that are organised by other agencies.    Further work is being undertaken with the Overarching Housing Forum to consider the impact across the social housing sector.

6.         Progress on implementation has been made as follows:

·           April 2013 Changes

Council Tax Reduction Scheme

7.         The Council Tax Reduction Scheme was implemented as part of the 2013-14 council tax billing process.  The scheme was applied to 10,973 council tax accounts in April 2013.  The claimant count is currently 10,917. The scheme was 'fully funded', i.e. there was no general requirement for claimants of CTR to make a contribution.  The withdrawal of second adult rebate affected 96 claimants. 

8.         Expenditure on the scheme is currently £9.157m, compared with a budget of £9.4m. The collection rate at quarter 2 is 58.4%, compared with 57.8% at the same stage last year.  Since the scheme is funded there has not been a significant effect on the collection rate.

9.         The National Assembly for Wales in passing the enabling regulations inserted a 'sunset' clause, which requires a new set of regulations to be passed for the scheme to operate from 2014/15.  It is anticipated that the scheme will again be 'fully funded' i.e. there will be no general requirement for claimants of CTR to make a contribution 2014/15. The revised regulations are currently subject to technical consultation.  There will now be a requirement to inform and consult claimants regarding the 2014/15 scheme as the position is clarified.  A further report will be made when the 2014/15 scheme is finalised by WG.  This will again require approval by Council before the end of January 2014.

10.      There are likely to be further changes to the scheme from 2015/16, which is being developed by a working group of officials from the Welsh Government, the WLGA and the CAB.

Local Housing Allowance (LHA) 

11.      The LHA scheme was introduced on 7 April 2008 and has since been amended several times.  From April 2013 the scheme was amended so that the rent officer determines the LHA figures annually to apply from the beginning of April of each year. Each year’s LHA figure is set at the lower of either the rent set at the 30th percentile or by the previous year’s LHA figure uprated by the Consumer Price Index for the preceding September. The April 2013 LHA rates are set out in the table below.  This change has affected 2,937 housing benefit claimants in the private rented sector in the Vale. There have not been any major issues with the current LHA rates.  However the change in rules for the under 35 year olds which took effect from April 2012 has had an impact as they are now only entitled to housing benefit on the shared accommodation rate. 105 cases were originally identified a small number of claimants found other accommodation but a large proportion has received a discretionary housing payment because either they were reaching the age of 35 within a 2 year period or they needed self contained accommodation because of child access.  This aspect of the change can cause difficulty for single persons under 35 over accommodated in the social rented sector as they would only be entitled to the shared accommodation rate in the private rented sector. 

 

LHA weekly rents

2012

2013

Change

Shared accommodation

£51.92

£53.06

+1.14

1 Bedroom

£98.08

£98.08

none

2 Bedroom

£121.15

£118.27

- 2.88

3 Bedroom

£132.66

£132.66

none

4 Bedroom

£173.08

£173.08

none

5 Bedroom

£173.08

£173.08

none

 

 

Rules on under occupancy (size restriction) 

12.      The changes to housing benefit in the social rented sector, where working age tenants are deemed to under occupy their homes was implemented from 1 April 2013. A reduction of benefit of 14% for under occupancy by one room or 25% for two or more rooms has been made.  

13.      The benefits service has identified households to try to alleviate the issues surrounding the size restriction. The number of households affected by the size restriction is 1,035 which is a reduction to the original list.  The benefits service has worked closely with the Housing Department and Housing Associations by providing them with lists of the households affected. Regular meetings have taken place to iron out any issues to ensure a smooth implementation of the new rules takes place. They have also worked with the customers affected by the change and where possible have identified households that would qualify for an extra bedroom for a carer where there is a need for overnight care, or to ensure that the recorded family make up is correct. 

14.      There are currently 625 council tenant households affected by the changes. Each of those households has been contacted on at least four occasions by the 2 dedicated Welfare Advice officers based within the Housing Income Team. The Department has adopted a 'Prevention First approach' to dealing with those who are struggling to pay their rent and we have had a great deal of success in increasing  tenants income through a range of interventions including advice on water metering, budgeting, charity grants, food banks, Utility schemes and close collaboration with CAB and other organisations.

15.      Rent income continues to be closely monitored and though the Department has seen an increase in arrears of £7,000 for those affected since April 2013. This is well below the modelling scenarios undertaken earlier in the year. Of the 625, 48% of accounts continue to be clear or in credit, 11% show their arrears to be improving and 41% where accounts have worsened. The Housing Department have yet to evict any tenants for pure under occupation Charge arrears.

16.      Of the households impacted, 248 are registered on the Council Homes 4 U lettings scheme with 19 tenants being rehoused since April into smaller accommodation. A major issue facing the Department is a lack of appropriate 1 bedroomed accommodation with only 460 properties and of those only 15 becoming vacant in the last 12 months. The Department continues to explore a range of initiatives to increase the stock available through de designation, sharing and where possible new build through partner RSL’s and S106 agreements.           

17.      The Benefit Section and Housing Service have been inundated with enquiries regarding the new rule. This change has had the most significant impact on the service.  The use of DHPs has cushioned the immediate effect of the reforms and some of the interventions above will only have a short term benefit.  Officers will continue monitor the position closely.

 

Social Fund

18.      The Social Fund was replaced by the Discretionary Assistance Fund (DAF) in Wales from April 2013.  The Discretionary Assistance Fund is a grant scheme which can provide payments or in-kind support for two purposes: 

·           Emergency Assistance Payment (EAP) - Provide assistance in an emergency or when there is an immediate threat to health or wellbeing

·           Individual Assistance Payment (IAP) - Enable independent living or continued independent living, preventing the need for institutional care 

19.      Payments are available to people who do not have alternative means of paying for what they need and the payment does not need to be paid back. Both EAP & IAP grant awards are for one-off needs rather than on-going expenses.

20.      The role of the Council is to signpost potential claimants, particularly in relation to clients of social services and housing. Social Services have registered with DAF to help clients apply for payment if required.

 

Discretionary Housing Payments (DHP)

21.      The policy for the administration of discretionary housing payments was reviewed and agreed by Cabinet on 1July 2013.

22.      Additional funding was provided by the DWP for DHPs to help alleviate some of the impacts on the benefit changes.  

23.      The purpose of a DHP is to help benefit claimants meet a shortfall in their rent or to help people move to cheaper alternative accommodation. DHPs are not only to assist people who have been affected by the Welfare Reforms but are available for all housing benefit claimants where there is a need.  However, the majority of DHP applications have been from those who have been affected by the size restriction. DHPs are only a short term measure as there is a limited fund available.  761 DHPs have been received to date 678 have been processed, 300 have been awarded for different period lengths, 378 didn’t qualify and 83 are waiting to be processed.  The Benefit Section have been inundated with DHP applications from February 2013 are still receiving them at a steady rate.  The section is expecting them to increase in numbers when the increase in gas and electricity take effect.  

24.      Of the total of £219,639 allocated by the DWP, £119,161.39 has been spent and £43,112.65 is committed.  This totals £162,274.04 leaving £57,464.96 available for further commitments. 

·           July 2013 Changes

Introduction of the Personal Independence Payment

25.      As part of the wider Welfare Reforms, the Personal Independence Payment (PIP) replaced the Disability Living Allowance (DLA) for new claims from people who are aged between 16 and 64 on 8 April 2013 or reach 16 after this date. The scheme was piloted from April 2013 and introduced for all new claimants from July 2013.

26.      It was originally intended that reassessments from DLA to PIP would be phased in nationally from October 2013; however, assessments were taking longer than expected resulting in a backlog of cases.  As a result there has been a delay and a gradual introduction will take place starting from 28 October 2013.  Claimants in receipt of DLA will only be invited to be reassessed for PIP in Wales, East Midlands, West Midlands or East Anglia.  DLA/PIP claims will be reassessed where a child in receipt of DLA turns 16, where there is a significant change in circumstances which would affect the rate of DLA, where a time limited DLA claim expires after 17 March 2014 or where there is a request to move from DLA to PIP.  

27.      The council is not responsible for any action but it may have an impact on Housing Benefit and Council Tax Reduction entitlements. The change also affects social services clients and the charging policy. Social services are monitoring impact of the changes, but there have been relatively few cases yet.

 

Introduction of the Benefit Cap

28.      An overall cap on the amount of benefit was introduced in July 2013.  A cap of £500 p.w. applies to couples and singe parents and £350 p.w. to single persons.  Certain categories of claimants are exempt from the cap, such as those within the household who are claiming disability living allowance or the personal independence payment.  The cap is implemented by a reduction in housing benefit however where the full amount of rent exceeds the cap a minimum payment of 50p housing benefit must be paid.     

29.      Implementation commenced in the Vale on 15 July 2013 and has been completed.  This impact was as follows: -  

Reduction in Benefit

Number

Under £25 p.w.

16

£25 to £50 p.w

3

£50 to £75 p.w.

7

£75 to £100 p.w.

3

£100 to £125 p.w.

3

£125 to £150 p.w

2

£150 to £175 p.w

1

£175 to £200 p.w.

0

Over £200 p.w.

1

 

30.      A total of 36 claims were originally affected by the benefit cap, 3 have since moved out of the area and 33 remain affected. The benefit reduction ranged from £3.76 p.w. to £210.65 p.w.

31.      The DWP sent letters to all those affect by the cap in May 2013 and also letters were sent by the Benefits Section informing them of the reduction in their housing benefit entitlement.

32.      The DWP make the decision on whether a household would be affected by the benefit cap.  Once they have made their decision the DWP notify the Benefit Section and they reduce the housing benefit award by the amount exceeding the cap.  If the Benefit Section identifies that a household would be affected by the cap they have to inform the DWP and wait for them to approve this before capping the claim.   

·           Introduction of the Universal Credit

33.      The Universal Credit applies to working age claimants. The implementation of the Universal Credit began in a small number of pathfinder areas in benefit offices in the north west of England.  One pathfinder (Ashton under Lyme) commenced processing UC claims in April 2013.  This was rolled out to Wigan on 1 July 2013 and Oldham and Warrington on 29 July 2013.  It was originally intended that the scheme would be phased in nationally from October 2013 for new claimants and claims where there are major changes in circumstances.  This has now been delayed.  A further 6 pathfinder offices across England , Scotland and Wales will now process UC claims from October 2013 on a rolling program ending in Shotton in Wales, which is due to start in March 2014.  It is not clear when the national rollout will start, however, it seems unlikely that there will be any significant impact in the vale in 2014/15. The plan is still to complete the migration of all housing benefit claims to UC by October 2017.

34.      Associated with the Universal Credit is the Claimant Commitment.  Those who are fit and ready for work will be expected to look for a job on a full time basis dependent on circumstances.  The Claimant Commitment will rollout nationally from October 2013 to the spring of 2014 to around 100 job centres per month.  20000 Jobcentre+ advisers will be retrained to provide enhanced job search support to deliver the claimant commitment. This will not impact on housing benefit but if claimants do not comply their JSA will be sanctioned therefore their JSA will be reduced.

35.      Officers from the council and the stakeholder group are currently working with local DWP offices on the Localised Support Services Framework, mapping existing services and considering future requirements.  It is anticipated that localised support services will be delivered by partnerships led by local authorities working closely with the DWP and other local partners to assist claimants. 

·           Changes to Pension Credit

36.      There are also proposals to transfer housing benefit  claimants of guaranteed pension credit age to the Pension Service.  This will not start before March 2015, but is also planned for completion by October 2017.

Resource Implications (Financial and Employment)

37.      The anticipated financial implications of Welfare Reforms were included in the 2013/14 budget. 

38.      Staff have been kept informed via team briefings, but as the transfer to UC has slowed, there have not been any significant implications as a result.

Sustainability and Climate Change Implications

39.      There are no direct climate change implications, however, the Council need to ensure that measures put in place to support welfare reform are financially sustainable.

Legal Implications (to Include Human Rights Implications)

40.      The Council is required to administer council tax, council tax reduction and housing benefit in line with government regulations.

Crime and Disorder Implications

41.      Future changes to the benefits may have implications.  

Equal Opportunities Implications (to include Welsh Language issues)

42.      Central Government and the Welsh Government have assessed the equality implications of the welfare reforms and the council tax support scheme.  The Council has assessed the implications of the discretions applied to the council tax reduction scheme in line with the regulations

Corporate/Service Objectives

43.      The service objective is to administer and pay housing benefits and council tax reduction to eligible claimants.

Policy Framework and Budget

44.      The matter is for Executive Decision by Cabinet.  The responsibility for decisions relating to discretions in respect of the council tax support will be set within the regulations.

Consultation (including Ward Member Consultation)

45.      Ward members have not been consulted as the issue affects all areas of the council.

Background Papers

Contact Officer

Clive Teague

Officers Consulted

Officer Working Group

Welfare reform officer working group

Responsible Officer:

Sian Davies – Director of Resources

 

 

Share on facebook Like us on Facebook