Transcript welfarereformpresentation

Welfare Reform
From Poverty to Financial Inclusion
17th October 2012
Purpose of the session
• Help you to understand the changes to
benefits
• Consider how the changes will affect the
residents of Oldham
• Think about how we can work together to
support our residents through the changes.
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Welfare Reform Act 2012
The aims are to
• Reduce the cost of the welfare system by £18bn
over five years
• Incentivise people into work – make work pay
• Make the system simpler and fairer all round
• Take a stronger line on tackling fraud
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Welfare Reform changes from April 2013
Universal Credit
Benefit Cap
Size Criteria
under occupation
penalty
Personal
Independence
Payment
Changes to
Council Tax
Benefit
Social Fund
Reform
Some residents will be affected by multiple changes
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Universal Credit
Brings together a range of working age benefits
into a single streamlined monthly payment.
The benefits replaced by Universal Credit are
• Income Support
• Income-Based Job Seekers Allowance
• Income-Related Employment and Support Allowance
• Housing Benefit
• Child Tax Credit
• Working Tax Credit
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The DWP national estimates
• 2.7 million claimants would see no changes to their
benefits
• 2.8 million claimants would see an increase in
benefits as a result of moving into work
• 2.2 million claimants would see a reduction in their
benefits (though this will not be an immediate impact
due to transitional protection rules)
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Testing before delivery
• Live Innovation Trialling (started in April 2012)
• Model Office (first took place in April 2012)
• Direct Payment Demonstration Projects (started June
2012)
• Local Authority-led pilots (to start Autumn 2012 – end
September 2013)
• Pathfinder (planned for April 2013 in Greater Manchester
and Cheshire)
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Oldham’s Universal Credit Timeline
Date
Claimant group
November
2012
Local Authority-led (face to face) pilot commences
April 2013
Pathfinder commences with a limited group of new
JSA claimants
October 2013
Roll out commences for all new JSA claimants
January 2014 New Working Tax Credit and Child Tax Credit will
be claims for UC
April 2014
New IS, ESA and HB claims will be claims for UC
July 2014
Managed migrations with priority given to those who
will benefit most from the transition
From 2015 2017
A gradual managed transfer of the remaining claims
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Local Authority-led (face to face) pilot
• From November 2012 to September 2013 we will test
mechanisms for
– Providing support to those who will be moving to UC – with a strong
focus on testing approaches with BME communities
– Supporting on line access
– Providing access to Financial and Budgeting Support
– Identifying claimants with complex needs and assessing support
required
• We will monitor, evaluate and provide feedback
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Implementation Planning Activities for Pathfinder
Stage 1
Oct/Nov 2012
Stage 2
Dec 12Feb 13
Stage 3
Mar/Apr 13
Stage 1
Stage 2
Stage 3
2 tasks
10 tasks
5 tasks
Pathfinder
commences
29th April
Landlord
Engagement and
Awareness
Staff Awareness
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Benefit Cap
• The benefit cap will be introduced from April 2013 and will
apply to the combined income from the main out-of-work
benefits, plus Housing Benefit, Child Benefit and Child Tax
Credits
• The benefit cap levels will be:
– £500 per week for couples and lone parents
– £350 per week for single adults
• The benefit cap will delivered from April 2013 by local
authorities through deductions from Housing Benefit, in
the future it will be delivered as part of Universal Credit.
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Benefit Cap
• The cap will not apply to those receiving
– Working Tax Credit
– Disability Living Allowance
– Personal Independence Payment (from April 2013)
– Attendance Allowance
– Industrial Injuries Benefits
– Employment and Support Allowance (support
component)
– War Widow's or War Widower's Pension
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Benefit Cap in Oldham
• Information received from DWP shows
– 316 households affected
– All are households with children
• The highest cap in Housing Benefit is £185.00 per week
• The highest overall cap is £303.60 per week
• The HB reductions applied from April 2013 will total £936k per
annum
• When all claimants have transferred to UC the total reduction in
benefit will be £1.2m per annum
.
Based on data scan 3 received September 2012
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Size Criteria (underoccupation)
• Size criteria will be introduced to Housing Benefit for
working age claimants in the social rented sector from
1st April 2013
• Those considered to be under-occupying their
accommodation will see a reduction
– 14% of their total eligible rent for under-occupation by
one bedroom; and
– 25% of their total eligible rent for under-occupation by
two bedrooms or more.
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Size Criteria (underoccupation)
Claimants will qualify for one bedroom
(up to a maximum of four) for:
– Every adult couple
– Any other adult aged 16 or over
– Any two children of the same sex aged under 16
– Any two children regardless of sex aged under 10
– Any other child aged under 16
– A non-resident carer (claimant/partner have disability
and need overnight care).
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Size criteria
• 8,791 working age Housing Benefits claimants in the
social rented sector
• Approximately 30% are believed to be under occupying
• For those under occupying
– by 1 bedroom the average reduction in eligible rent will be £11
per week
– by 2 bedrooms or more the average reduction in eligible rent
will be £21 per week
• Estimate the total reduction in HB to be £1.7m per
annum
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Replacement of Disability Living Allowance
with Personal Independence Payments
• From April 2013 new claimants age 16-64 will claim
PIP
• Different assessment criteria and face to face
consultations as part of the assessment
• Existing claimants transferred from DLA to PIP
between October 2013 and March 2016
• As at February 2012 residents in Oldham receive
approximately £32m in DLA payments per year
• National estimates suggest that there will be a 20%
reduction in benefits paid, this could mean a £6m
reduction for residents in Oldham.
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Social Fund Reform
• Abolition of Crisis Loans for living expenses
and Community Care Grants
• Replacement with local welfare provision
• Flexibility to design emergency provision for
vulnerable groups according to local
circumstances
• 2013/14 Oldham will receive a non ring-fenced
grant of £1.038m
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Options currently being considered
• Development of a scheme which utilises, builds and
funds supportive projects already in place.
• Develop a scheme which is similar to the current
DWP scheme.
• Develop a scheme which supports both residents
and the groups and organisations supporting them.
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Council Tax Benefit replaced by local scheme
• Reduction in funding to
local authorities
• Claimants of Pension
Credit Age are
protected
• Consultation runs until
the 3rd December 2012.
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What does this mean for Oldham?
• Estimated £3.044m reduction in funding (which
includes £400k for the fire and police preceptors)
• Estimated £1.044m additional income will be raised
from Council Tax changes to empty properties and
second homes
• Estimated £2m less available to pay in benefit
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Oldham CTB Claimants
Type of Recipient
Number
%
Pension Credit Age
10,786
39%
Working
age
passported benefits
11,008
40%
Working age – other
5,806
21%
Protected
from Changes
Yes
No
No
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Oldham’s proposed scheme
• Benefit will only be calculated based on the Band A
Rate of Council Tax (this will affect all claimants in
Band B or above).
• In addition for all working age claimants benefit will
be reduced by 25%.
• Second adult rebate for working age claimants will be
abolished.
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Risks and Issues
• Residents affected by multiple changes
• Wider impact on residents – not just financial
• Lots of information still unknown or being
developed by DWP
• Increase in demand for advice services at the
same time as changes to legal aid are being
introduced
• Increased demand on organisations for
support
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What are we doing?
• Raising awareness and seeking opportunities to work
together
• Developing an action plan and communications plan
• Attending a wide range of DWP groups
• Working with RSL’s in the Borough
• Planning the delivery of the Stage 1 activities for UC
Pathfinder
• Preparing for the commencement of the face to face pilot
• Preparing a draft local welfare scheme for consideration
• Reviewing the Discretionary Housing Payment Policy
• Linking into Welfare Rights Take Up Activities
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Any Questions
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Discussion points
1. What might the impact be on
•
•
•
Residents
Organisations
Borough
2. How can we work together to support those affected?
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Contact Details
Suzanne Heywood
Tel no 0161 770 4905
Email - [email protected]
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