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Building financial resilience
ahead of the curve
Policy in Practice
Sarah Lambert
www.policyinpractice.co.uk
A team of professionals with extensive knowledge of the welfare
system. We’re passionate about ...
Agenda
www.policyinpractice.co.uk
● We’re in a climate of change and uncertainty
● Support and help available
● Case study...
A climate of change and uncertainty
www.policyinpractice.co.uk
● By June 2020 DWP received over 3.2 million individual dec...
COVID-19 presents new challenges
www.policyinpractice.co.uk/coronavirus
● Out of work benefits doubled to 2.7m by July 202...
The story so far ...
www.policyinpractice.co.uk/coronavirus
Council Tax collection has suffered
● 1.3 million households i...
Building financial resilience now is key
www.policyinpractice.co.uk/coronavirus
● Over 20 million of us don't have the
rig...
We all need the welfare system
www.policyinpractice.co.uk/coronavirus
• At any one time over half of all
families receive ...
Support and help is available
www.policyinpractice.co.uk/coronavirus
1. Job Support Scheme
(furlough scheme)
2. Self emplo...
www.policyinpractice.co.uk
Universal Credit and the welfare system
● Jobseekers Allowance (JSA)
● Employment and Support A...
www.policyinpractice.co.uk
Case study: Re-imagine Debt
An example of data and engagement
www.policyinpractice.co.uk
● ‘Re-Imagine Debt’ came out of cross-departmental competition
● Led by the Cabinet Office and ...
www.policyinpractice.co.uk
Why Reimagine Debt?
“Often, residents have other
challenges to deal with which
can affect how t...
www.policyinpractice.co.uk
A tale of debt prevention in two cities
● Focused on those most at risk for
the pilot
● Identif...
www.policyinpractice.co.uk
Return on investment
Average arrears fell by 65% and by £160
London Borough of Barking and Dage...
www.policyinpractice.co.uk
Newcastle City Council
● Professional debt advisors led the discussions
London Borough of Barki...
www.policyinpractice.co.uk
The evaluation found that debt can be
collected in an intelligent and cost
effective way that d...
www.policyinpractice.co.uk
Outcomes
Of the households tracked in Newcastle, the following outcomes were achieved:
Arrears ...
www.policyinpractice.co.uk
Outcomes
Of the households tracked in Barking and Dagenham, the following outcomes
were achieve...
www.policyinpractice.co.uk
Feedback from advisors
Mental health improved
“It takes a boulder off their shoulders.”
“We fil...
www.policyinpractice.co.uk
Digital solutions that can help
How to improve financial capability
www.policyinpractice.co.uk/coronavirus
• Identify how to maximise income from
eligibil...
How to improve financial resilience
www.policyinpractice.co.uk/coronavirus
• Redundancies are set to rise
• Fluctuating in...
How to engage customers earlier
www.policyinpractice.co.uk/coronavirus
• Many people will need support
from the welfare sy...
Thank you
www.policyinpractice.co.uk
I look forward to your questions. To learn more, please
contact me:
Sarah Lambert
Aff...
Build financial resilience ahead of the curve
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Build financial resilience ahead of the curve

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Sarah Lambert, Affordability Assessment Manager, Policy in Practice, delivered this presentation to the Money Advice Liason Group (MALG) Virtual summit on Thursday 29 October.

Over 20 million of us don’t have the necessary skills to effectively manage our money and 11.5 million of us have less than £100 in savings.

With predictions of widespread unemployment and an expected tsunami of people needing debt advice and support during the coming months and years, this session explored the innovative new tools and approaches that will help organisations to improve the financial capability of customers, increase the financial resilience of customers and engage customers earlier.

Sarah Lambert from Policy in Practice discussed research and initiatives we've developed, including our award winning Benefit and Budgeting Calculator, to support organisations to get ahead of the curve.

For more information visit www.policyinpractice.co.uk, email hello@policyinpractice.co.uk or call 0330 088 9242.

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Build financial resilience ahead of the curve

  1. 1. Building financial resilience ahead of the curve Policy in Practice Sarah Lambert
  2. 2. www.policyinpractice.co.uk A team of professionals with extensive knowledge of the welfare system. We’re passionate about making social policy work We help over 100 local authorities use their household level data to identify vulnerable households, target support and track their interventions Our benefit calculator engages over 10,000 people each day. We identify the steps people can take to increase their income, lower their costs and build their financial resilience Policy in Practice: What we do
  3. 3. Agenda www.policyinpractice.co.uk ● We’re in a climate of change and uncertainty ● Support and help available ● Case study: Re-Imagine Debt - an example of data and engagement ● How to improve financial capability, increase financial resilience and engage customers earlier
  4. 4. A climate of change and uncertainty www.policyinpractice.co.uk ● By June 2020 DWP received over 3.2 million individual declarations to Universal Credit. That’s 2.6m households and 1.1m advance payments. ● By August 9.6 million people were on furlough, 2.6 million people claimed SEIS, worth £7.5bn ● Since April 750,000 people have lost their job (OBR) ● This could rise by up to 960,000 during October (10% of furloughed people) ● The number needing support via benefits is likely to increase ● How do we help people access this support and understand eligibility
  5. 5. COVID-19 presents new challenges www.policyinpractice.co.uk/coronavirus ● Out of work benefits doubled to 2.7m by July 2020 ● 15% of the 9.6M on furlough are estimated to become unemployed soon ● Labour market stats: redundancies have doubled in the last quarter Key upcoming changes: ● End of furlough ○ new Lockdown Job Support Scheme and Part-time Job Support Scheme ● COVID-19 benefit changes to expire ● Brexit ● Forbearance from Mortgages, Loans and Credit Cards is coming to an end ● Peoples savings have been drained leaving them financially vulnerable to manage unexpected bills or costs ● The UK is heading for a financial downturn and recession
  6. 6. The story so far ... www.policyinpractice.co.uk/coronavirus Council Tax collection has suffered ● 1.3 million households in arrears, worth £500 million (25 June) ● Reduction to income is primary (although not the only) reason for arrears ○ Being a key worker and having to shield were also factors The homelessness ‘landscape’ has changed ● 14,500 street homeless placed in emergency accommodation by June ● 5,400 people in temporary accommodation as part of “Everyone In” ○ Funding for the initiative has since stopped ● £13M for winter support ● An estimated 6 million people have fallen behind on a household bill ● Anxiety has increased creating more metal health issues with less NHS resources to manage them
  7. 7. Building financial resilience now is key www.policyinpractice.co.uk/coronavirus ● Over 20 million of us don't have the right skills to manage our money well and 11.5 million of us have less than £100 in savings ● What does this mean for organisations managing customers who are not financially resilient and not receiving the support they are eligible to receive? ● How can organisations ensure they themselves understand the changes made to support these customers?
  8. 8. We all need the welfare system www.policyinpractice.co.uk/coronavirus • At any one time over half of all families receive income from at least one benefit in the welfare system, including child benefit when young, and the state pension when retired. • Our lives are ever changing. Disability sickness, separation and unemployment can affect any of us, and we need a strong safety net when it does.
  9. 9. Support and help is available www.policyinpractice.co.uk/coronavirus 1. Job Support Scheme (furlough scheme) 2. Self employment scheme 3. Social security and Universal Credit 4. Emergency provision for those who are missing out 5. Forbearance with payment breaks on Mortgages, Credit Lines and Loans from the financial services industry
  10. 10. www.policyinpractice.co.uk Universal Credit and the welfare system ● Jobseekers Allowance (JSA) ● Employment and Support Allowance (ESA) ● Income Support (IS) ● Housing Benefit ● Child Tax Credit ● Working Tax Credit and Childcare Tax Credit ● Universal Credit ● Council Tax Reduction ● Free School Meals ● Social Tariffs ● Council Tax Reduction ● Free School Meals ● Social Tariffs Legacy system Universal Credit ● Contributory JSA / ESA ● New style JSA / ESA
  11. 11. www.policyinpractice.co.uk Case study: Re-imagine Debt An example of data and engagement
  12. 12. www.policyinpractice.co.uk ● ‘Re-Imagine Debt’ came out of cross-departmental competition ● Led by the Cabinet Office and two pilot local authorities Aims of the project ● Collect more, at a lower cost, and with better outcomes for people in debt ● Develop a single view of debt owed by individuals to government, rather than trying to collect multiple debts across different departments ● Initiate proactive, preventative and holistic debt interventions with residents to improve how money owed to local and central government is collected ● Phase one: Newcastle and Barking and Dagenham councils each manually pooled debt data on 39 families and offered them holistic debt guidance. The Re-imagine Debt project
  13. 13. www.policyinpractice.co.uk Why Reimagine Debt? “Often, residents have other challenges to deal with which can affect how they’re able to deal with the financial aspects of their lives. Proactive and holistic debt interventions can support them to do this, helping people to get back on their feet and have a more stable life.” Claire Horton Newcastle City Council “Debt is not about numbers, debt is about people, behaviours and circumstances. We fix debt problems by focusing on people.” Steve Coppard Cabinet Office “Debt is almost always a symptom of a deeper challenge. Data allows you to quickly identify that there’s a problem, and face to face interaction allows you to get to tackle the root cause and find solutions.” Mark Fowler Barking and Dagenham
  14. 14. www.policyinpractice.co.uk A tale of debt prevention in two cities ● Focused on those most at risk for the pilot ● Identified 20 households already in serious debt, owing more than £20,000 ● Of these, 14 households engaged and were offered holistic support alongside debt guidance ● Took an early intervention approach, working with families through their Community Solutions team ● 28 households with combined government debt of below £8,000 ● Of these 25 people were seen and 17 experienced a positive outcome
  15. 15. www.policyinpractice.co.uk Return on investment Average arrears fell by 65% and by £160 London Borough of Barking and Dagenham Fiscal savings £246,449 Economic savings £78,835 Total savings £325,284 Total cost £9,545 Total benefit £315,739 Return on investment 34 x Newcastle City Council Fiscal savings £113,682 Economic savings £61,415 Total savings £175,097 Total cost £6,873 Total benefit £168,224 Return on investment 24 x Average arrears fell by 29% and by £1,081
  16. 16. www.policyinpractice.co.uk Newcastle City Council ● Professional debt advisors led the discussions London Borough of Barking and Dagenham ● Residents were supported by a team from Community Solutions Both councils ● Holistic support of short, informal meetings given ● Residents discussed debt management advice as well as mental health ● Follow up meetings as needed, average of four advice sessions ● Action-orientated advice, eg applying for Discretionary Housing Payments and other underclaimed benefits, budgeting, and liaising with creditors including council tax departments, as well as private sector creditors Type of support given
  17. 17. www.policyinpractice.co.uk The evaluation found that debt can be collected in an intelligent and cost effective way that delivers better outcomes to society
  18. 18. www.policyinpractice.co.uk Outcomes Of the households tracked in Newcastle, the following outcomes were achieved: Arrears fell: ● People in arrears of £250+ fell from 74% to 58% ● Rent and council tax arrears fell by £1,216 ● 17% became wholly arrears free ● Arrears fell by £200 more in the treatment group than in the control group Income rose: ● Benefits income increased by £115 ● Average income rose by £124 per month
  19. 19. www.policyinpractice.co.uk Outcomes Of the households tracked in Barking and Dagenham, the following outcomes were achieved: Arrears fell: ● People in arrears of £250+ fell from 18% to 8% ● Average rent and council tax arrears fell by £174 ● Arrears fell by 3x more in the treatment group than in the control group ● Half of all participants became arrears free Income rose: ● Average benefits income increased by £171 per month ● Average earned income increased by £108 per month ● Unemployment fell from 91% to 67%
  20. 20. www.policyinpractice.co.uk Feedback from advisors Mental health improved “It takes a boulder off their shoulders.” “We fill in the difficult period for them to get back on their feet again.” “They don’t know where to turn, they are coping with so much.” People felt empowered “[They were] passive participants in their financial lives.” “Debts and deductions just happen.”
  21. 21. www.policyinpractice.co.uk Digital solutions that can help
  22. 22. How to improve financial capability www.policyinpractice.co.uk/coronavirus • Identify how to maximise income from eligibility for benefits • Save, print and download results so customers can share them with other companies or debt advisors. • Complete affordability assessments via industry standard statements • Ensuring consistency when gathering information
  23. 23. How to improve financial resilience www.policyinpractice.co.uk/coronavirus • Redundancies are set to rise • Fluctuating income makes budgeting very difficult • Unstable income from work causes fluctuations in UC • People can understand how a change in employment, hours worked or hourly rate will affect their finances
  24. 24. How to engage customers earlier www.policyinpractice.co.uk/coronavirus • Many people will need support from the welfare system for the first time and won't know what they can claim • Organisations can proactively reach out to people who show first signs of financial stress to offer a tool that helps • People don't have to be experts to have confidence they are receiving accurate guidance. Using a digital solution developed by Policy Experts ensures accuracy • With so many support schemes available customers are empowered and have increased confidence • Reduce poverty, increase financial resilience and avoid detrimental mental health caused by financial uncertainty Little known benefits can really help eg free school meals, warm home discounts, water tariffs
  25. 25. Thank you www.policyinpractice.co.uk I look forward to your questions. To learn more, please contact me: Sarah Lambert Affordability Assessment Sales Manager sarah@policyinpractice.co.uk 07917 475982 hello@policyinpractice.co.uk 0330 0889242

Sarah Lambert, Affordability Assessment Manager, Policy in Practice, delivered this presentation to the Money Advice Liason Group (MALG) Virtual summit on Thursday 29 October. Over 20 million of us don’t have the necessary skills to effectively manage our money and 11.5 million of us have less than £100 in savings. With predictions of widespread unemployment and an expected tsunami of people needing debt advice and support during the coming months and years, this session explored the innovative new tools and approaches that will help organisations to improve the financial capability of customers, increase the financial resilience of customers and engage customers earlier. Sarah Lambert from Policy in Practice discussed research and initiatives we've developed, including our award winning Benefit and Budgeting Calculator, to support organisations to get ahead of the curve. For more information visit www.policyinpractice.co.uk, email hello@policyinpractice.co.uk or call 0330 088 9242.

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