1. Housing and Welfare Reforms: Issues for ALMOs Steve Wilcox University of York

2. Housing and welfare reforms: Issues for ALMOs Housing Benefit Reforms The Maximum Benefit Cap Universal Credits

3. The Housing benefit reforms Private sector reforms Caps & lower LHA rates CPI Indexation (& definition) Increased non dependent deductions Social sector size limits Additional bedroom for carers Discretionary Housing Payments increase

4. Caps and Lower LHA Rates Maximum National Caps Maximum 4 Bed Rate 30 th Percentile Rates (5/8% below median) Removing £15 excess provisions Increased pressure on social sector

5. The Maximum Benefit Cap Based on national average earnings Applies to all tenures Only applies to out of work households Doesn’t apply to disabled or retired Impact on large families in high rent areas Likely to be some modifications?

6. Impact of Maximum Benefit Cap

7. Universal Credits I Major Structural Simplification Based on Dynamic Benefits Single Integrated Taper Aims to promote work incentives Higher initial costs Long term savings from work impacts ?

8. Universal Credits II Transitional protection Future ‘gainers’ and ‘losers’ Integrated ‘real time’ weekly adjustments Challenging IT and Admin Reforms Limited lone parent allowances Help with housing costs reconfigured

9. Universal Credits: Help with housing costs High earnings disregard But reduced if help with housing costs Mortgage costs included (?) Council tax benefit excluded (?) Many in work claimants better off But complexity will dilute message

10. Marginal deductions from gross earnings: Current system and universal credit

11. The Earnings Disregard Formula Earnings disregard for tenants = Higher earnings disregard - Rent times 1.5 - Subject to lower earnings disregard floor But no disregard for a single person

12. Higher and lower earnings disregards HouseholdHigherLowerHousing Cost Trigger Couple£57.70£10£31.80 Couple + 1£109.60£20£59.80 Couple + 2£109.60£25£56.40 Lone parent + 1£148.10£40£72.10 Lone parent + 2£148.10£45£68.70

13. The current benefit poverty trap Couple with two children. £80 pw rent. 2010/11 Rates Under £180 pw less than 30 hours

14. The structure of universal credits Couple with two children. £80 pw rent.

15. Net impact of systems compared Couple + 2 children. Rent £ 80. Council Tax £ 15. £ 5.93 per hour earnings.

16. Universal Credit Issues Risks & intermediate rents The national cap & work Complexity of earnings disregards The direct payment issue(s) The monthly payment norm Provisions for mortgage costs? Council tax benefit?