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Welfare Reform Bill ….will restore fairness and simplicity to a complex,outdated and wildly expensive benefits system.

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Presentation on theme: "Welfare Reform Bill ….will restore fairness and simplicity to a complex,outdated and wildly expensive benefits system."— Presentation transcript:

1 Welfare Reform Bill ….will restore fairness and simplicity to a complex,outdated and wildly expensive benefits system.

2 Where are we? Lords committee stage to begin on 4 th October. Moving steadily to Royal ascent. Little substantive change since removal of 10% HB/JSA cut. Amendments of the 19 th Sept include payments direct to landlords with consent; 4 weeks with rent arrears. Provision for claimant regulatory authority.

3 Current landscape Already in the midst of great change. Migration from incapacity to ESA. LHA set at the 30 th percentile of private local rent prices. LHA maximum caps. Moving back of lower age of pension credit qualification. Benefit increases CPI rather than RPI.

4 Current landscape Increased non dependent charges. Erosion of tax credits. April 2012: Threshold for qualification will be 24 hours rather 16 for couples who wish to claim WTC. Single room/shared accommodation rent restriction for under 35s brought forward to January 2012.

5 Unprecedented change. Biggest change to welfare benefit provision since the National Assistance act of 1911. Government spends more on welfare benefit system than the NHS; in 2009/10, £192 billion compared to £98 billion. 35 billion on defence. Public support,apathy or confusion? Media;temporary 50% tax rate?

6 Government Aims ….not about saving money….seeking to modify peoples behaviour. Chris Grayling. ….once and for all put an end to entrenched worklessness. I.D.S. Subliminal totalitarianism? A sociological attempt at mass social control? Simply saving money, or all three?

7 The changes Universal credit. Under occupancy for social housing tenants. Ending of DLA/introduction of PIP. Household benefit cap. Restriction of contributions based ESA. Ending of the social fund.

8 Universal Credit Still remarkably sketchy. Will replace: housing benefit, income support, income based JSA, based income based ESA, working tax credit, child tax credit and the social fund. Aims to reduce barriers into work and complex interactions between in work and out of work benefits.

9 Continued…… Robust conditionality; benefit sanctions for up 3 years, £50 fines. Ending of permitted work earnings disregards. Raw deal for disabled carers. Recent leak re: viability of I.T system. Roll out from 2013 to 2017. Historically, centralisation hasnt worked well. Passporting benefits? Social Security Advisory Committee.

10 Under occupancy for social housing tenants Help with housing costs to be restricted to the number of rooms required. Applies to working age claimants, with working age being extended. Major problems with affordability. DHPs. No disability exemptions at present.

11 Household benefit cap April 2013; controversial as it is more likely to impact upon larger families. Housing benefit/costs will be the mechanism for limiting the total benefits income. £500 per week for couples or £350 weekly for single claimants. Problematic re: city rents. Possible U turn.

12 Cont…….. Family with 3 children in a four bedroom house may have basic benefit income of £350 weekly. LHA cap for a 4 bedroom property is £400 weekly. To avoid shortfall rent would need to be £150 or less. DLA claimants will be exempt as will WTC claimants. Increased homelessness and segregation; claimants migrating to cheaper areas.

13 Sickness and disability benefits. Contributions based ESA limited to one year from April 2012 for those in the WRAG; support group exempt. Those on CB ESA for a year at the point of change will lose it. ESA in youth to end. Converting from incapacity; 12 months from date of conversion. Income based ESA an option until UC.

14 The end of DLA. Government targeting DLA due to year on year rise in payments and claims from inception in 1992. April 2013 Personal Independence Payment. Seeks to reduce DLA expenditure by 20%. Mobility and care components. Lower rate care to be abolished. Tougher medical assessments, wholesale re-assessment. BIP?

15 The end of DLA. All claimants to be assessed. A belief that many claimants would not meet more stringent qualification criteria. More robust expectation re: notifying the Dept concerning improvements in medical condition. Initial pre-qualification period to be extended from 3 months to 6 months.

16 End of the discretionary social fund The social fund has operated since 1988. Discretionary element has been controversial but designed for the poorest or most vulnerable. The discretionary SF will be devolved to WAG and the Scottish Parliament and local authorities in England. Community grants, crisis loans type payments. Automated or regulated elements will be retained by UC; cold weather payments, budgeting loans, funeral payments.

17 Cont……… Non ring fenced budgets. Unclear how payments will be administered. Post code lottery. IRS to be abolished. 60% of CCG applications refused. Localism Bill and the Big Society; other means to satisfy immediate need to be propagated: food banks, charitable support, credit unions etc.

18 Conclusions: Institute for Fiscal Studies report the poor will bear the brunt of austerity measures. Top 10% of UK earners will see a 4% drop in income. The lowest 20% will see a 6% drop compounded by cuts in public services. Greater inequality, increased child poverty and homelessness.

19 Example: Mr and Mrs A, 58; 2 adult children have moved out of the family home, going to university. Mr A has recently lost his DLA claim following new medical assessment. Had not been paying non-dep charges. Facing a cold winter of high bills. Couple are defined as workless and are receiving the lowest element of Universal Credit. They are over accommodated in their RSL property and cannot pay the shortfall in rent. Rent arrears increasing. Hoping to hang on until Mrs A can claim her pension........................

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