Cardiff Partnership Board June 2012 Item 5.1 Welfare Reform Update Jane Thomas Cardiff Partnership Board June 2012

Summary Reduction in Benefit Levels for private tenants This year will see radical changes to Welfare Benefits Including: Reduction in Benefit Levels for private tenants The Benefit Cap Social Housing Size Restrictions Introduction of Universal Credit Council Tax Support Social Fund reform Other welfare benefit changes

Reductions in Benefit Levels for Private Tenants April 2011 - all benefit levels for private tenants were reduced & 5 bedroom rate removed. Single room restriction extended to age 34 Started to affect existing claimants from Jan 12 Information is being sent to claimants and their landlords & re-housing advice offered House Share Wales website launched

Benefit cap From April 2013 total benefits received is to be restricted to average earnings If income is over £350pw for single person or £500 for couples & families, HB will be reduced Exemptions - pensioners, disabled, in receipt of Working Tax Credit, War Pensions Includes hostels, refuges and other temporary accommodation 400 cases in Cardiff, 100 will lose over £100 pw. 95% have children, 41% have 5 or more children. 51% are council or housing association tenants

Social Housing Size Restrictions From April 2013 social tenants who under occupy will have their HB restricted Pensioners are exempt Children are expected to share a room until aged 10, (aged 16 for children of the same sex) 14% restriction for one room (£13.50) 25% restriction for two rooms (£24.00) Estimated 3,500 council tenants could be affected Concerns about rent arrears / evictions / homelessness and costs of rent collection

Universal Credit Housing Benefit, Income Support and many other welfare benefits are to be replaced by Universal Credit To be phased in from October 2013 to 2017 Most customers will be expected to apply online Currently 2,500 customers seen face to face each week in Cardiff Possible role for Council’s in face to face services Payment to be made 4 weekly in arrears Direct payment to social tenants (to be piloted in Torfaen)

Council Tax Support From April 2013 Council Tax benefit is to be replaced by local council tax support schemes Funding to be reduced by at least 10% (£2.8 million in Cardiff) Funding to be cash limited – will not increase with demand Devolved to Welsh Government who want a national scheme with some local variation No commitment to protecting pensioners / other groups (if pensioners are protected cut to working age is 16%)

Council Tax Support Issues WG have consulted but no response issued yet Concerns about time to develop & agree local variations, consult, amend software, train staff and communicate changes by Feb 13. Scottish Govt is funding the shortfall 35,000 households currently claim CTB in Cardiff Currently assessed alongside HB – one claim for both benefits

Social Fund Reform Some social fund payments are to be devolved from 2013 Community Care Grants – e.g. to help vulnerable people settle in community Crisis Loans – to meet needs in disaster or emergency In Cardiff - approx 18,000 applications made in 2009.10 - £1.7million paid out.

Social Fund Reform Issues WG want National Scheme with local delivery – they have consulted but no response yet No clarity on who will be responsible for delivery Different delivery models have been suggested - Local Authority or Third Sector consortia WG looking for innovative solutions – eg providing goods rather than money & involvement of credit unions Concern about delivering any scheme within the timescales Need for clear gateway to access the service

Changes to other Benefits Incapacity benefit is currently being replaced Employment Support Allowance and claimants reassessed Working Tax Credit - now need to work 24 hours a week to qualify (does not affect lone parents) Disabled Living Allowance is being replaced by Personal Independence Payments (PIP) from April 2013 and claimants reassessed

Economic Impact Wales - 18.4% of working age households are claiming benefit (GB average 14.5%) Households in Wales to lose 4.1% of their income or £1,110 per year Inner city area of Cardiff among worst affected The poorest households with children will lose the largest proportion of their income

Way forward Officers working closely with WLGA / WG Resources for planning have been put in place Housing Strategy plan developed, working closely with RSLs to develop new types of accommodation and encourage downsizing. Increased Discretionary Housing Payment to be used to help people move by paying bonds and rent in advance. Communication plan developed including internal and external stakeholders

kept informed contact us at If you would like to be kept informed contact us at welfare.reform@cardiff.gov.uk