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Preparing for Welfare Reform and Universal Credit.

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Presentation on theme: "Preparing for Welfare Reform and Universal Credit."— Presentation transcript:

1 Preparing for Welfare Reform and Universal Credit

2 Quick Introduction..... Settled Housing Solutions align local authority services so they can pro-actively work with the Private Rented Sector(PRS)

3 Quick Introduction... Settled Housing Solutions (SHS) was formed in 2007 SHS is made up of housing and homelessness practitioners, qualified trainers, property investors, software developers and financial services To date we have delivered over 30 PRS related projects across the UK. In 2009, invited by the Department for Communities and Local Government to contribute to PRS related policy Two local authorities a week are signing up to our SettledSure Insurance Scheme.

4 Setting the Scene PRS is set to dominate the future of housing By 2020, 27% of the population will be renting Localism Act now provides new powers for local authorities to offer tenants a PRS housing option PRS landlords and letting agents are key stakeholders in local authorities future housing strategies Landlords just want to be treated as equal partners

5 Welfare Reform – Why Change? To make the benefits system more efficient To remove the barriers to work Encourage tenants to take greater control of their lives and finances Smoother transition in and out work Save the Govt ££££?

6 Housing Benefit has already changed ! From April 2011: Caps on weekly LHA rates LHA set at the 30 th percentile of rents in each local area From January 2012: Shared Accommodation Rate increased to under 35 From April 2012: LHA rates frozen and updated annually by reference to the Consumer Price Index (CPI)

7 What's planned for 2013 and beyond... April 2013 Welfare Benefit Cap will be introduced Applies only to households out of work Benefit Cap will be £500 per week for couples and lone parents £350 per week for single adults.

8 What does this mean? A non-working 2 parent household with 3 children £ Income Support £ Child Tax Credits £ Child Benefit Local Housing Allowance (if living in a 3 bed property) Total of £ From April 2013, the amount they will receive will be capped at £500 The family will be worse off by £45.76 per week if they decide to stay where they are Remainder will be deducted from their Housing Benefit. So a landlord receiving direct LHA payments will see a drop from £ per week to £ per week.

9 Options for Tenants Take up work (16/24 hours) Reduce non-rent expenditure Apply for Discretionary Housing Payments Move to cheaper accommodation

10 Universal Credit The future is digital! No more local authority HB Teams! Phased in between million HB claims need to be converted to UC

11 Payment of Universal Credit Universal Credit will be paid monthly Plan to pay tenants directly (At the moment!!) Claimants will be responsible for managing all household costs, including rent payments

12 focus pilots - Twelve pilots will run from autumn 2012 to September 2013 to explore how local expertise can support residents to claim Universal Credit 2013 focus pilots will look at: -encouraging claimants to access online support independently - improving financial independence and managing money - delivering efficiencies and reducing fraud & error; and - reducing homelessness - (some pilots will focus on service issues in rural areas) Post 2015 focus pilots – will look at the longer term role for local authorities in supporting Universal Credit claimants North Dorset Rushcliffe Melton Bath & NES Oxford Lewisham West Lindsey Caerphilly Newport Birmingham North Lanarkshire West Dunbarton Local Authority-led Pilots Oldham Wigan Dumfries & Galloway Edinburgh Wakefield Shropshire Southwark Torfaen Key: LA-led pilots Pathfinder preparation projects Direct Payment Demonstration Projects

13 13 Learning network Bi-monthly Learning Reports may be found in Learning Network a Network run jointly by DWP, DCLG and Chartered Institute of Housing and hosted on Chartered Institute of Housing web-site: Key early findings included the following: Engaging with and assessing the needs of claimants has proved more protracted and more resource intensive that anticipated. Landlords do not have access to information that would enable them to assess their tenants readiness for direct payment. There is a general lack of awareness of wider welfare reforms among tenants participating in the projects and the role of support partners in project is crucial Project areas have been able to manage the additional resource demands to date and it is evident that setting in place safeguards. Sheffield Hallam University have been commissioned to evaluate the projects. A Learning The Lessons report will be published in January next year and, following completion of the project next summer, a final project evaluation will be published in the late summer or early autumn of 2013.

14 Possible impact on landlords and letting agents LHA rates are now less reflective of the local rental market. There may be an increased risk of rent arrears. Larger households move to cheaper parts of the country

15 So what should landlords and letting agents do? Be Pro-Active and Don't Panic Ask your tenants if they have received any letters from the DWP about the changes Are your tenants currently in or out of work (16/24 hours a week) Jobcentre Plus and local authorities are now providing support for households effected by the changes Find out what your local authority can offer you in the way of advice and incentives

16 SettledSure – Housing Benefit Insurance Policies Local authorities, insurance underwriters, practitioners in Housing Benefit and DWP Reform and the PRS all consulted during development stages Protects landlords from rental losses, legal fees, theft and malicious damage Now being used as an Landlord Incentive by local authorities in return for accommodation

17 Thank you for listening Mobile


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