Mapping The Impact of Welfare Reform and Universal Credit, With Your Own Data
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Local authorities know that the impact of welfare reforms is going to be big, but they have no way of knowing the impact that future reforms like Universal Credit would have. By running housing benefit data through Policy in Practice’s Universal Benefit Calculator they can understand the impact at an aggregate level as well as pin pointing exactly how each household is affected by welfare reforms. Deven Ghelani, CEO of Policy in Practice and a director of the Welfare Reform Club, gave a webinar on this topic in July 2015.
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Mapping The Impact of Welfare Reform and Universal Credit, With Your Own Data
- 2. Mapping the impact of welfare reform and Universal Credit, with your own data
- 3. About Policy in Practice We make the welfare system simple to understand, so people can make the decisions that are right for them. Consultancy SoftwarePolicy www.policyinpractice.co.uk
- 4. Who will Welfare Reforms hit hardest? www.policyinpractice.co.uk
- 5. Targeting Support: Who will Welfare Reforms hit hardest? www.policyinpractice.co.uk • Context: How to co-ordinate limited support, as demand increases? • Approach: A detailed Impact Assessment for all reforms, today and tomorrow. • Outcomes: Better targeted support that has a tangible impact on behaviour.
- 6. The Challenge • We need to understand the impact of all welfare changes, to better co-ordinate activity. www.policyinpractice.co.ukwww.policyinpractice.co.uk Chris Gibbs, Birmingham City Council We want the council to move beyond sticking plaster solutions. If we can promote work and independence by understanding who is impacted by welfare reforms and working closely with partners, we will have more resources available for people that still need our support. We have an obligation to protect and support the most vulnerable
- 7. Context: Birmingham & Leeds The Scale of Birmingham • Size: Over 1m residents • Diversity: Population, Geography & Affluence • Unemployment: 5.9% vs 2.5% nationally; 30,000 JSA claimant count, 2nd highest • Housing: 56% o/occ, 24% social, 20% PRS • Politically Active: Largest Local Authority in Europe, with 40 wards and 120 active local councillors www.policyinpractice.co.uk
- 8. Context: The local authority The Local Authority: • Co-ordinates activity among stakeholders • May be a Social Landlord • Is responsible for Universal Credit support • Has Reduced budgets to deliver support now and in the future www.policyinpractice.co.uk
- 9. Context: The local authority Common Actions • Established partnerships with stakeholders • Has a focus on UC implementation – A single portal for feeding back issues on UC to DWP within the formal monitoring process – Shared training and learning sessions with JCP work coaches from each of the 12 sites • However… www.policyinpractice.co.uk
- 10. data + software = actionable insights www.policyinpractice.co.uk
- 11. Our approach: Using local data insights effectively SHBE Universal Benefit Calculator See the impact of specific and cumulative reforms at an aggregate and a household level A detailed impact assessment for Cabinet members that informs targeted and tailored local welfare support Any Questions? www.policyinpractice.co.uk
- 12. benefit cap Under- occupying LHA cap Council Tax Reduction CTRS Tax Credit cuts lower UC higher UC Better off in Work # of households affected by multiple reforms No impact 1 reform 2 reforms AA1 0 0 7 20 TBC 9 16 32 8 21 7 AA4 1 0 59 38 TBC 21 25 55 10 44 25 AA11 1 19 45 99 TBC 68 61 143 47 113 47 AA16 0 0 0 0 TBC 0 1 1 1 0 0 AB1 0 16 25 74 TBC 30 46 99 36 70 34 AB2 2 39 89 224 TBC 37 123 246 109 189 96 AB3 0 31 41 140 TBC 38 88 134 78 128 55 AB4 0 75 166 341 TBC 106 190 456 148 327 163 AB5 3 129 73 336 TBC 136 180 432 150 318 155 AB6 14 266 630 1355 TBC 406 899 1456 834 1354 575 AB7 17 629 346 1839 TBC 780 1038 2235 822 1636 838 AB8 43 442 1083 2662 TBC 1140 1306 2786 912 2119 1346 AB9 51 968 979 3466 TBC 1481 1614 3103 1411 3085 1676 Who has been impacted by reforms to date? What will be the impact of Universal Credit? Who has been hit by multiple reforms? The depth of our analysis goes even deeper, to household level Explain a complex picture to Cabinet Detailed picture of welfare reform at household level www.policyinpractice.co.uk Tax Credit cuts?
- 13. Context: Working age households: 29% 20% 5% 33% 13% In work Not in work Not in work, carer Not in work, disabled Not in work, lone parent www.policyinpractice.co.uk
- 14. Reduction in the Benefit Cap: 756 7,285 At £26k At £20k • A reduced Benefit Cap would 10x the number of capped households www.policyinpractice.co.uk
- 15. Reduction of the Benefit Cap: Weekly benefit cap amount 169 161 115 85 76 114 23 12 1 2,263 951 955 756 1,003 1,153 200 3 1 £0-20 £21-40 £41-60 £61-80 £81-100 £101-150£151-200£201-300 £301+ NumberofCases Weekly Benefit Cap Amount £26k £20k
- 16. Preliminary findings paint a stark picture www.policyinpractice.co.uk
- 17. Preliminary Findings – Universal Credit • Universal Credit with full transitional protection would bring the local economy £1.6m each month – an additional £30/month for each working age household on average. £32,028 £18,189 £26,956 £15,959 Couple with children Couple without children Lone parent Single Earnings required for UC to fall to zero www.policyinpractice.co.uk
- 18. Changes to Tax Credits • 91% of households in receipt of Working Tax Credit (19,403) will have a reduced award due to the reduction in the earnings threshold. • 36% of households in receipt of tax credits (20,498) will have a reduced award due to raising the tax credit taper rate from 41% to 48%. • 5,852 households in the Work Related Activity Group will lose the WRAG premium, worth £29.05 per week Changes to ESA Changes for Young People • 85% of HB recipients aged 18-21 are out of work and will lose automatic entitlement to HB • 4,042 young people aged 18-21 will be expected to ‘earn or learn’ (includes non-dependants) • 65% of self-employed households have earning below the Minimum Income Floor. Changes for self-employed People
- 19. If you had these insights too, what would you do differently? www.policyinpractice.co.uk
- 20. What would you do differently, if you knew who was impacted, and how? • Local Authorities face difficult choices – £12bn of cuts with reforms aimed at changing behaviour. – The combined impact on households is changing, complex and confusing. • The risk is that households won't get the right support – Councils need to better co-ordinate support with partners. – This includes financial support and support toward independence. – Without better co-ordination, and support into employment, there won't be enough support available to go around. – This will cost the council and taxpayers through impacts on other services. • We hope that this approach that will help you to – Better co-ordinate support and prepare for reforms – Explain a complex picture, both to cabinet and to the end user – target and tailor support effectively – Have a tangible and measured impact on behaviour www.policyinpractice.co.uk
- 21. Better Outcomes: A better Council Tax Scheme and operational plan for UC www.policyinpractice.co.uk Better partnership working Better preparation for Universal Credit Better targeted and personalised support Better able to map local support onto need A new Council Tax Support Scheme
- 22. VS Support that leads to savings: Targeted and Tailored Support – letters that engage people www.policyinpractice.co.uk
- 23. How do you show the impact to the person in a meaningful way? JSA Child Tax Credit ESA Housing Benefit Working Tax Credit Income Support Engage people and change behaviour www.policyinpractice.co.uk
- 24. Next Steps We will send you: • This webinar recording • This slide deck You can request: • Full analysis and data insights that Policy in Practice delivered for Leeds CC www.policyinpractice.co.uk
Editor's Notes
- Hi, I’m Lisa from Policy in Practice. Our mission is to reduce poverty. We do this through simplifying the welfare system. Story: About Policy in Practice: It’s how you communicate policy that matters [Policy – UC report, FIC; Consultancy – USDL evaluation and I will explain; Software – Live demo The current context – Universal Credit, alongside other changes designed to make savings We know three changes We don’t know the rest… (infographic) Policy: Universal Credit and its aggregate impact Practice: How useful is this? The real question - What does this mean for me? One – a system that illustrates the impact (choose a case to show how UC is different, and why) Two – how this can help you to better target support – based on a case study in Leeds, and now Birmingham Summary There is uncertainty, but you can plan for it: Identify not only who is affected, but how they are affected Engage people by showing them how the reforms will impact them (both self-service and targeted) and showing them wiifm Evaluate your activities by trialling different approaches, learn what works and share with others To start off with, I’d like to tell you a bit about Policy in Practice. We were founded by Deven Ghelani, who was part of the team that developed Universal Credit at the Centre for Social Justice. When UC was adopted, he saw this as a unique opportunity that not many people have in the policy world – to have your idea actually be put into practice – so he had two options: to move on to the next policy report, or to try make Universal Credit work. He founded Policy in Practice to address the gap between policy and practice. We do a variety of different things to achieve this. We do policy research, which is mostly what I will be talking to you about today. We also do consultancy work, mostly for local authorities, to help them better understand the impact of welfare reform, or to help them develop their own schemes. We also have a range of outcome-based software tools, like our Universal Benefit and Budgeting calculators that help our clients to be more effective in supporting customers and deliver policy intent. Before joining Policy in Practice, my personal background was working in frontline services, for charities like Turning Point and Centrepoint, supporting people with substance misuse issues and homeless young people. I have also done some volunteering at a homeless day centre in Manchester. In those roles I dealt with the benefit system on a daily basis and found it a challenge, to say the least. While at Centrepoint, I helped one of my young people get a job at the local Co-op. The impact on her was incredible. She developed a routine and gained a great deal of confidence. However the impact on her finances was very difficult. Her JSA and HB stopped the day she started working, even though she wouldn’t get paid for another month. She accrued rent arrears and had to be referred to a food bank to get through that first month without either benefits or pay. It seemed like the system was punishing her for trying to improve her situation.
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- We can put in place support on 1:1 basis – in the future, we won’t be able to do that. 3rd Sector Commissioning strategy, Future Advice Model.
- In contrast, the current benefit system is very complex. We have a range of benefits offered by 3 different agencies all with their own set of rules. From a recipient’s perspective, this means multiple applications, providing evidence to more than one agency, and managing multiple claims and payments. The complexity of the system is confusing for people, sometimes even for professionals who deal with it on a daily basis, which can hamper the take up of benefits. Take up can be as low as 60% in the case of Jobseeker’s Allowance, or 64% in the case of Working Tax Credit. That means that around 40% of people entitled to those benefits are not receiving them.
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