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Welfare Reforms An overview of the benefits affected and potential impact.

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Presentation on theme: "Welfare Reforms An overview of the benefits affected and potential impact."— Presentation transcript:

1 Welfare Reforms An overview of the benefits affected and potential impact

2 Setting the Scene Benefits Cap – September 2013 Restrictions to Tax Credits Housing Benefit restrictions – on going Changes to sickness benefits Disability Living Allowance – Personal Independence Payments Localisation – Council Tax Help – April 2013 Localisation – Social Fund – April 2013 Universal Credit – starts 2013/2014

3 Private Sector rent restriction Local Housing Allowance (LHA) is used to set the amount of rent used for Housing Benefit Levels set for different sizes of property by location Rules set the size of the property allowed for each household depending on size

4 Changes to LHA LHA rates are set at 30% of average rents charged rather than 50% Maximum 4 bedroom rate regardless of family size Shared accommodation rate increased for single people from 25 to 35 years of age LHA rates will be increased each April based on inflation (not location/market forces)

5 Rent charges

6 Households where homelessness prevented

7 Households presenting as homeless compared to statutory acceptances

8 Social Housing Size Restrictions People in housing association properties have their rent treated as eligible for benefit in full From April 2013 for working age claimants size related criteria will apply That is people under the qualifying pension age for women Approximately 1000 housing association tenants living in Huntingdonshire will be affected

9 Who needs a bedroom? A couple A person who is aged 16 or over Two children (under 16) of the same sex Two children who are under 10 Any other child (not a foster child or one whose main home is elsewhere) A carer or group of carers who provide overnight care to a disabled person

10 Social Housing Size Restrictions People who ‘under occupy’ could lose benefit Reduction will be 14% for one room, 25% for more than one room on the rent figure used to work out benefit entitlement These rules will not affect people in ‘exempt’ supported accommodation No 4 bedroom maximum rate No shared accommodation rate

11 Who will be affected? Couples whose children have left home Divorced or separated families Foster carers Families who have a child who is looked after by LA All others with a spare bedroom

12 Social Housing Size Restrictions HDC has given a list of households affected to each housing association HDC and the housing associations have written to people affected It is important that people think about how they are going to deal with this change and talk to their landlord and the HB Team

13 What does the Government suggest? Move to more appropriate accommodation Take in a boarder or lodger Ask non dependant family members to contribute more Start work or increase hours of work Apply for a Discretionary Housing Payment

14 Discretionary Housing Payments ‘Top up’ where Housing Benefit does not meet full housing costs Administered at HDC by the Benefits Team Discretionary – no entitlement Increased DHP budget for 2013/14 (Up from £56k in 2012/13 to £170k in 2013/14)

15 Benefit Cap Postponed from April to September 2013 Out of work benefits to be capped so that people out of work should not have more income than people in work Cap will be £500 per week for couples/families And £350 per week for single people Benefit received above that level will be removed from Housing Benefit The cap does not apply if someone in the household gets Disability Living Allowance or Working Tax Credit

16 Tax Credit Changes Cuts were made to Tax Credits in April 2012 Most couples with children now need to work at least 24 hours per week (previously 16) to get Working Tax Credit Families used to get some Child Tax Credit until taxable income was over £40,000

17 Sickness Benefits The new sickness benefit, Employment and Support Allowance was introduced in 2008 People on Incapacity Benefit, Severe Disablement Allowance & Income Support as sick are being reassessed for the new benefit If accepted as ‘sick’ will transfer onto ESA If not accepted (after challenge), they may have to claim Jobseekers Allowance – look for work Transfer runs until April 2014

18 Employment and Support Allowance The test is the ‘Work Capability Assessment’ Points based system for deciding ‘sickness’ Many people have a medical assessment Carried out by ATOS healthcare Lots of people have been told they are fit for work Large increase in appeals

19 Disability Living Allowance From 2013 Disability Living Allowance will be phased out for working age adults To be replaced by a new benefit – Personal Independence Payment The intention is to reduce the budget for disability benefits by 20% Applies to 16 – 64 year olds Medical examination required

20 Localisation of Council Tax Support The national Council Tax Benefit scheme is being abolished from April 2013 District councils must devise their own scheme within certain parameters: –Funding cut by about 10% –Pensioners must not be affected by any change –Must consider the impact on vulnerable people –Can look to make the savings from elsewhere

21 Localisation of Council Tax Support Main principles of scheme at HDC: –Most working age people will have their Council Tax Support based on 80% of their Council Tax liability –Families with children under 5 – 85% –Severely disabled people and families with disabled children – 100% Just under 5000 working age people currently claim help towards their Council Tax in Huntingdonshire

22 Impact of Council Tax Support

23 Localisation of Social Fund National Social Fund has been administered by the DWP Community Care Grants and Crisis Loans to go To be replaced by local authority schemes – county councils Reduced funding from Government Not ring fenced Councils will announce schemes soon

24 Universal Credit Replaces seven means tested benefits Income Support, income based JSA and income based ESA Child Tax Credit and Working Tax Credit Housing Benefit Housing costs in Income Support/ESA/JSA

25 Universal Credit Expected to be phased in between 2013 and 2017 Major change in benefits law Will rely on large IT systems – linked to Income Tax records Claims will be ‘digital by default’ Housing Benefit will gradually transfer away from HDC to Department for Work and Pensions from 2014

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