Deven Ghelani, Director and founder of Policy in Practice, was invited to speak at the Local Authority Civil Enforcement Forum on the topic of 'Debt, Financial Resilience and Vulnerability'. He focused on our early intervention work on arrears with local authorities who are using data analytics insights to identify vulnerability, target support and track change. For further information visit www.policyinpractice.co.uk, call 0330 088 9242 or email hello@policyinpractice.co.uk

1. Deven Ghelani
Policy in Practice
LACEF
Debt, Financial Resilience
and Vulnerability.

2. We make the welfare system
simple to understand, so that
people can make the decisions
that are right for them
We help people toward
independence by making
government policy simple to
understand.

3. 333
Why are people in debt?

4. Wider welfare reforms and austerity

5. People are worse off

8. • 1.6 million people on Universal
Credit today
• A further 1.6m people moving onto
Universal Credit this year
• 2 million people moving on through
‘managed migration’ from 2020
Key Recommendation:
The DWP and councils can identify
these pressure points, and act
proactively to prevent hardship and
ease the transition to Universal Credit.
Universal Credit is rolling out fast

9. The average amount of income after
costs for low income households is
£452/month.
• With a deal, income after costs
falls by £100 per year (on
average).
• Under a no deal scenario, which
looks unlikely, income after costs
falls by £250 per year.
• However, unemployment and a
weaker economy driving
austerity could lead to Brexit
impacting incomes by as much
as £1400 / year.
The impact of Brexit
CPI is forecast to hit 3.7% due to devaluation, plus a
further 1% impact on costs due to tariff / non-tariff
barriers.
Unemployment + 0.3% with a deal
Unemployment + 2.6% in a no deal scenario

10. Cost avoidance through reimagine debt interventions:
• Court costs of enforcement and better collection
• Eviction (referred to panel) and care costs for children
(direct care costs and impacts of moving schools)
• Improved wellbeing and better mental health
outcomes (17% of cohort), e.g. lower GP / Medication
costs (no longer losing sleep, less anxiety, depression,
leaving the house)
• Advisors had impacts on other outcomes too, clients
could be suicidal, facing domestic violence, have
language barriers to overcome, or parental conflict
(parents with non-dependant children)
The impacts of indebtedness

11. 111111
Policy in Practice has been asked by the
Cabinet Office to conduct analysis in support
of a project on the management and
collection of local and central government
debt.
Building on the successful ‘Reimagine Debt’
pilot, the project as a whole seeks to
understand the role of data to generate a
consolidated household level view of debt.
Consolidated debt data, placed in the
context of a household’s wider economic
circumstances, can create a culture of
holistic, proactive and effective service
delivery across local & central government.
Phase 1 of the project saw Newcastle and
Barking and Dagenham councils manually
pool debt data on 39 families to offer them
debt guidance. Phase 2 looks at how this
approach can be scaled to deliver benefits to
the public.
Reimagine Debt

12. We pool your datasets on
low income families, and link
them over time to create a
single view
Our policy engine shows
the impact of all policies,
now and in the future, on
each family
The insights enable you to
proactively identify who
needs what support,
engage people and track
impact
Household data + Advanced Analytics

13. 16,934 low income households in Neath Port Talbot

14. 2,596 are in council tax arrears

15. 1,255 owe more than one month’s council tax

16. 205 of them are impacted by welfare reform

17. 59 of whom face an ongoing cash shortfall

18. … and seven will be worse off under Universal Credit

19. Focus on 1 household

20. Engage through tailored calculation

21. Policy / legislative awareness: Look into the three cases where DHPs were
refused. If households affected by welfare reforms had been made aware of
DHPs earlier, then arrears could potentially have been avoided.
Ensure take-up of benefits: many of the improved cases started claiming
Housing Benefit and/or Council Tax Support for the first time.
What counts as an improvement?: There are cases where arrears have
worsened, but their lives may have improved in other aspects (ie they have
started work, agreed a payment plan). We need to track these households over
a longer time period.
Many of the improved households had changed utility provider: Is this a large
opportunity, and does it have implications for the involvement of third parties
eg. utilities?
Consider differences in outcomes between Advisors: 90% of Advisor 3's clients
saw their level of debt improve - compared to 63% of Advisor 2's and 43% of
Advisor 1's. Are different Advisors taking different approaches, and can
improved approaches be scaled?**
Lessons learned in Barking

22. We tracked the debt severity, living standards, financial resilience and other outcomes for 21 households across Barking
and Dagenham across eighteen months.
• 3 households moved out of arrears completely
• Average arrears fell by £1,100
• Across the 21 households, the total rent arrears balance fell by £17,600 and the total council tax arrears balance fell by
£5,500
The outcomes of reimagine debt

23. www.policyinpractice.co.uk
Thank you
Deven Ghelani
deven@policyinpractice.co.uk
07863 560677
Adam Kenny
adam.kenny@policyinpractice.co.uk

24. A team of
professionals
with extensive
knowledge of the
welfare system
who are
passionate about
making social
policy work
We help over 80
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
actions people can
take to increase
their income,
lower their costs
and build
resilience