Housing associations and welfare reform - what's the true impact on tenants and income?
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Welfare reforms such as Universal Credit and the Benefit Cap create a complex picture for councils and their housing partners. It’s important to understand the true impact of all the benefit changes on individual households so that the most effective support programmes possible can be put in place, and rental income is protected. Policy in Practice is helping councils and housing organisations to support their most vulnerable tenants through welfare reforms. In this practical webinar Adam Knight-Markiegi and Zoe Charlesworth from Policy in Practice share the work we’ve done with Newcastle CC and Your Homes Newcastle. Listen to learn how we helped Newcastle City Council and YHN to: 1. Understand the cumulative impact of welfare reforms on individual households 2. Support tenants to budget under Universal Credit, and take action to avoid the impact of the Benefit Cap 3. Create efficiencies for staff; who may need training on reforms, and help in having broader conversations with residents 4. Help tenants to self serve, and avoid having to tell their story more than once.
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Housing associations and welfare reform - what's the true impact on tenants and income?
- 1. Policy in Practice Webinar: Welfare Reform – what’s the true impact on each of your tenants, and your rental income? Wednesday 21 September 2016
- 2. Housekeeping • Audio check • Please ask questions • Polls and a survey • Finish by 11:30
- 3. Speakers Zoe Charlesworth Policy in Practice Adam Knight-Markiegi Policy in Practice
- 4. Agenda • Introduction to Policy in Practice • The problems faced by Your Homes Newcastle • An overview of our approach • Key findings from our analysis • Using our calculator • The difference we’re making
- 5. We make the welfare system simple to understand, so that people can make the decisions that are right for them
- 6. www.policyinpractice.co.uk SOFTWARE individual impact CONSULTANC local impact POLICY national impact
- 7. 777
- 8. Over to Adam
- 9. 999
- 10. • Your Homes Newcastle is an award- winning ALMO responsible for managing 27,000 homes on behalf of Newcastle Council • YHN and Newcastle Council worked with Policy in Practice to identify the impact of welfare reforms on each of those individual households Council and ALMO working together
- 11. A trio of problems to tackle Nearly 12,000 YHN tenants could move to Universal Credit, so increased demand for existing specialist support services Donna Gallagher, YHN’s Universal Credit Implementation Manager, said “Everyone’s going to have to provide a little bit of support, benefits and budgeting advice.” The trio of challenges were: • understanding the impact of welfare reforms • supporting tenants • creating efficiencies for staff and the organisation
- 12. They wanted to see: “Mrs Biggins at 73 Acacia Avenue will be affected by all welfare changes by £15.62 per week, particularly Universal Credit, and she has low barriers to work” www.policyinpractice.co.uk
- 13. The solutions 1. Smart analysis: Welfare Reform Impact Analysis 2. Powerful software: Universal Benefit and Budgeting Calculator
- 15. Policy in Practice’s approach Your Housing Benefit / Council Tax data / Arrears Our Universal Benefit Calculator Rich, detailed impact assessment: who is impacted and what are the city-wide effects? 1. Use local data and insights to inform better decision making 2. See the impact of different models together with ongoing welfare reforms 3. Better strategic and operational decisions
- 16. Characteristics of households affected by bedroom tax 61%20% 12% 7% Household type Single Lone parent Couple without children Couple with children 25% 52% 7% 4% 12% Economic status In work Not in work, disabled Not in work, lone parent Not in work, carer Not in work, other
- 17. Households affected by benefit cap, by weekly HB reduction 14 10 5 6 7 2 112 120 71 77 95 50 £0-20 £21-40 £41-60 £61-80 £81-100 £101-150 £26,000 (current) £20,000 (from April 2016)Nov
- 18. YHN: how the analysis helps us “We’ve matched the dataset back to our rent accounts and identified groups of people we can now work with on specific things. We can now proactively reach out to people in a preventative way.”
- 20. 202020 Powerful software Helping people make decisions that are right for them
- 21. Key benefits
- 22. Universal Benefit and Budgeting Calculator Assists both staff and customers; • Works offline – helpful for home visits in rural areas • Includes a self-service option for tenants – saving advisors time and promoting inclusion • Can be customised – to reflect your priorities and tone of voice • Includes built in help, training and live chat support for advisors • Uses colour, visuals and simple language
- 23. Powerful software Provides customer focused illustrations of the impact of welfare reform. Advisors don’t need to be policy experts to explain the welfare system and what the changes will mean. This enables tenants to engage with the impact of welfare reform through frontline conversations. • It can show a customer how they will be impacted by the benefit cap and how a change to working additional hours can impact on household income. • It can compare the current system and Universal Credit side-by-side to enable customers to budget for future changes. • It provides simple illustrations of income against household outgoings and so provides an introduction to discussions of possible actions to mitigate shortfall.
- 24. YHN: how the software helps us “The action plan isn’t just words, it’s visual. If someone isn’t improving their circumstances we’ve got something in place to review with them and look at their support options.”
- 25. The impact 1. Preventative approach for the organisation a) Better targeted support to residents who need it most. Preventing some from being affected by welfare changes and softening the impact on others b) Understand the potential implication of welfare reform on the organisations balance sheet c) Understanding the actual impact enables resource planning. Especially around support d) Informs joint working to mitigate and prepare for impacts. 2. Provision of active support a) Understanding the impact of individual reforms and the combined impact of reforms b) Help residents understand the impact of welfare reform on their finances and to plan for income shortfall 3. At risk income identified One HA identified a seven figure sum of rental income at risk from 500 households most affected by lower benefit cap
- 26. Polls
- 27. Next steps Complete the automated survey immediately after this webinar to: 1. Get the YHN case study and Welfare Reform Impact Analysis report 2. Set up a dataset demo for you and your colleagues 3. Set up a software demo for you and your colleagues We have permission from existing clients to share their reports with other local authorities who may be similar in structure, demographics or strategic vision to you
- 28. www.policyinpractice.co.uk Thank you Adam Knight-Markiegi adam@policyinpractice.co.uk 07757 012 918 hello@policyinpractice.co.uk
Editor's Notes
- [Are we using polls?]
- Adam Knight-Markiegi is Head of Operations at Policy in Practice 15 years in the housing sector – in policy, research and consultancy – always working with local authorities and housing associations Last role was at HouseMark – so he’s very familiar with housing data and the challenges facing the sector Adam joined Policy in Practice keen to help people understand policy on the frontline, so they can help improve residents’ lives. He wants to turn insight from analysis into practical steps on the ground.
- Policy in Practice is a social policy software and consulting business. We were founded by Deven Ghelani who was part of the team that developed Universal Credit at the Centre for Social Justice. When the policy was adopted by government, he left there to set up Policy in Practice. He was keen to ensure that the policy intent was actually put into practice. Since then, and together with the team he's built at Policy in Practice, he's facilitated conversations between leading local authorities and the Prime Minister's office to ensure frontline feedback about welfare reform policy has been heard. In addition, Deven and the team have helped local organisations to understand the aggregate and cumulative impact of welfare reform changes on their customers so that they can accurately target support programmes. And finally, to close the loop, the software that Policy in Practice has developed simplifies the conversations that frontline advisors can have with customers by clearly showing what benefits they can get under the current system and when they move to Universal Credit, comparing the two side-by-side using data visualisation. --- DG notes --- Onion Slide (DG) http://policyinpractice.co.uk/brexit-whats-next-esf-local-authorities/ How this affects each individual household in your local authority - CTRS / SHBE
- Green – positive (at least for customers): Higher personal allowances for income tax Move to the National Living Wage (for those aged 25 or over), right through to £9 per hour by 2020 1% rent cut in social housing – a positive for your tenants but not for you – we realise this – eg Alliance cutting 11% of jobs earlier this year Red – negative: Freezing benefit levels for four years Continual rollout – but less generous – Universal Credit – and in social housing this means a move to direct payments to your tenants instead of you Lower benefit cap – our analysis shows how many more households are affected by this across the country, not just in London Pay to stay in council housing LHA for new tenancies in social housing – particular worry about the impact on under-35s because of the Shared Accommodation Rate 1% rent cut Value for money – so efficiencies, mergers etc You’re having to work more closely with tenants and wider customers, including dealing with debt, employment and increasingly wider support matters like mental health
- Partnership Data sharing Universal Credit rollout in Newcastle Live service from April 2015 – only for single people previously eligible for JSA, including some on existing Housing Benefit and those earning less than a certain amount Full service from May 2016 (until June 2018) – starting with new claims, then change of circumstances, people already on UC 2018 and 2021 – managed migration of everybody else We are a trusted Partner and have been since March although they have recently extended the pilot by another six months. We are able to apply for APA’s on day one of the claim and then work to support the customer to better manage their money.
- Almost half of their tenants – so YHN has anticipated that its existing specialist support services would need to change in order to cope with such demand. Understanding the impact of welfare reforms Welfare reforms paint a complex picture Bedroom tax, benefit cap, Universal Credit, lower LHA rate Supporting tenants Increased budgeting pressure – fears of rent arrears rising under Universal Credit Having to tell their story more than once – frustrating for customers and a waste of time for staff Creating efficiencies for staff Training up staff for impending changes critical Identifying amount of rental income at risk – risk financially to the organisation Identifying tenants most at risk of falling into debt
- Smart analysis: Welfare Reform Impact Analysis Teamed up with Newcastle Council Housing Benefit dataset + arrears data Analysis of the combined and growing impact of all welfare reforms on households in Newcastle + YHN tenants Analysis of data provided evidence for decision making and operationally Down to the level of Mrs Biggins on Acacia Avenue Intelligent use of data Identify and then target individual households and residents Proactive Understanding the impact on the bottom line, especially in light of the double whammy: 1% rent cut and direct payments under Universal Credit We’ve also done similar work in Walsall with Walsall Housing Group and Caldmore Accord, plus work with housing partners in London boroughs
- This shows the power of access to local authority data, as it shows the household composition and economic status, including disability. Some housing association data can show this but not all, as was clear to me from my work at HouseMark. It can also boost the data you already have, eg updating a disability status or identifying households with children. Household type: three out of five (61%) affected households are single – in mustard yellow on the left – though families with children still account for over one in four (27%) of affected households Economic status: over half (52%) are not in work but also disabled Because our analysis goes down to the household level, we can also pull out exemptions. For example, we identified 13 pension-age households who are affected by the bedroom tax.
- This very clearly shows the impact of the new, lower benefit cap - £20,000 for families with children and £13,400 for single people in Newcastle. The blue columns show the much higher number of households affected under the new cap. As you move to the right of the chart, households are more severely affected, with 50 households losing over £100 per week. This will firstly from out of their Housing Benefit. That’s a huge amount per week and is likely to lead to higher rent arrears. Coupled with Universal Credit, existing debt and issues like mental health, this is a scary situation. But one that you as landlords can do something about, especially by being proactive and working with these particular households individually. Your housing officers can target these 50 households to visit, understand their situation, help them to budget and manage debt, even help them to get into training or work. Our analysis pulled out exemptions here too – that is residents who should be exempt from the cap but are seeing their benefits capped. For example, people who qualify for Working Tax Credit (ie in paid work) or are in receipt of a qualifying disability-related benefit are exempt from the benefit cap. A quarter of YHN households currently capped seem to be exempt – 12 out of the 44. Policy in Practice identified over 500 households affected by the cap and that the average reduction in Housing Benefit, per household, under a lower Benefit Cap would be £52.54 per week or £2,732 per year.
- Donna Gallagher, YHN’s Universal Credit Implementation Manager As a direct result of the analysis YHN identified that a substantial seven figure sum of rental income was at risk as a result of the £20,000 Benefit Cap which will come in from this November.
- We recognise that one of the most powerful ways to protect rental income is through maximising tenant income and through customer engagement with yourselves. We also recognise that customer support is at the heart of the business of both local authorities and Housing Associations. Adam looked at how an understanding of the impact of welfare reform assists organisations in protecting rental income – the calculator assists the organisation in minimising those impacts through income maximisation, customer support and engagement
- The calculator we have developed is Universal benefit calculator that calculates all the mains means tested benefits. This slide gives an overview of the benefits of using the software based on feedback from people using the system. [slide] Outcome focused; Encourage to work (benefit cap). Even supports job search through links to Universal Job Match for local jobs. Behavioural change Budgetting Benefit entitlement/selection fo benefits The calculator is designed to be used by your clients directly or by officers supporting clients. It therefore fits with the digital-by-default agenda. However, many clients of both Las and HAs require support and this customer support is a key role for both organisations. This is where it facilitates the client engagement required to protect rental income.
- From a tenancy officers viewpoint we have been told that one of the most useful functions is the kick-start to discussions around budgeting which many tenants find difficult. From an organisational standpoint the calculator enables the household circumstances to be recorded and reviewed without the need for paper income and expenditure sheets. So saves time for staff and provides support to customers.
- Donna Gallagher, YHN’s Universal Credit Implementation Manager
- 1a – Mention DHPS and those not claiming. JRF identified group of those “just managing”. 1c – DHPS & CTRS 1d – LHA cap for social housing – informed discussions between LA and HA on “top-up” contracts or other measures to enable HA to continue supporting those for whom the LA had homeless obligations Success with employability team + apprentices – getting them into training and onto apprenticeships, having shown them how much better off they are in work Positive behaviour changes Help to boost household incomes
- [Include this here? May not make sense or be as powerful]
- This shows the potential of combining local authority and housing association data