1. Income Management What could you be doing? Yvonne Davies Head of Housing and Economic Development (North) June 2009

2. 2 What I will be covering Summary of our inspection approach on arrears, with particular reference to arrears recovery, debt advice and rent setting Overview of trends Lessons learned and good practice from inspections The impact of the recession and future challenges

3. Our inspection approach Why it matters Short Notice inspections Housing standards Kitemarks Crystal ball gazing And the KLOE…. And then CAA

4. 4 The Income management KLOE Arrears recovery Do you minimise loss of income by taking prompt and appropriate action to recover both current and former service user arrears and other debts? Debt advice Do you ensure that service users receive effective welfare benefit and debt advice to maximise income and manage debt? Rent setting Do you comply with the statutory requirements and adopt good practice methods in terms of rent and service charge setting?

5. 5 CAA expectations ‘We will judge how well councils and their partners understand the local impact of the recession and how well they are responding using the tools and influence available to them to mitigate the impact on their communities and prepare for the upturn’ (CAA framework overview Feb 2009) How strong is the economy? What is the response to the recession? Comprehensive Area Assessment of Local Strategic Partnerships…includes LAs and their partner HA contribution

6. Overview of trends

7. 7 LA arrears as % of total debit 2001-2008

8. 8 HA General Needs arrears as % of total debit 2005-2008 Source data: Tenant Services Authority

9. 9 % of landlord possession claims awarded at county court

10. Lessons learned from inspections …and good practice

11. 11 Some recent ‘trends’ from housing inspection The rise of ‘financial inclusion’ – holistic approach More use of specialist teams - less generic staff Early visits to new tenants becoming more common More landlords presenting their own Court cases... and using possession claims online More examples of good Court liaison, but still not the norm Inconsistent approaches over welfare benefits advice services – and the use of service level agreements

12. 12 Other recent ‘trends’ from inspections Growth in use of e-payments and 24 / 7 services More payment methods being offered by more, but not by all landlords (greatest variation is over e-payments) Limited use of ‘out of hours’ work for income collection More use of email and texting to remind tenants More use of targeted publicity campaigns – bus shelters, public buildings and even cinema ads More use of incentives for clear accounts Has not figured significantly in short-notice inspections

13. 13 Good Practice in income management Tenant support fund Financial inclusion Publicity on rent free weeks Welfare right services: free money, debt and benefit advice Proactive HB work and partnership with LAs High quality rent arrears awareness campaigns Debt advice project, including energy efficiency and money management Staff incentive schemes to keep debt down Multi agency partnerships

14. 14 Who has done it well in last two years on rent arrears? ALMOs Carrick Housing (Jan 07) Golden Gates (Feb 07) Solihull CH (May 08) Your Homes Newcastle (Jun 08) Homes for Islington (Sep 08) Poole HP (Sep 08) Gateshead HC (Feb 09) HAs Westcountry (Aug 07) Pathmeads (Dec 07)

15. 15 Who has done well recently on financial inclusion? Aire Valley ALMO, Leeds Poole ALMO, Barnet homes Cobalt HA, Liverpool Six Town ALMO, Bury South Tyneside ALMO Wakefield and District HA North Somerset Housing Management Services Your Homes Newcastle ALMO

16. 16 Some Benefit inspection findings – but still early days (June to April 09) 8 poor (zero star) ratings and 2 fair (one star); The perception of a ‘good’ service within councils –A tendency to look at ‘own’ performance rather than relative performance Profile of the benefit service An opportunity to challenge some long term issues –Notifications Not just slower processing times –Overpayment management –Benefit take-up –Understanding customers –Value for money –External contracts specified around performance standards –Performance management – information, targets, quality

17. The impact of the recession and future challenges

18. 18

19. 19 What have we learnt from last time? Study: A mine of opportunity? The first policy responses to the closures. In general these have involved ‘knee-jerk’ efforts to create jobs of any sort – often in the locations from which they were lost. This is associated with the aftermath of the final set of major pit closures in an area. Many authorities were effectively overwhelmed at this point. Their response was to seek assistance from national government. Phase 1 HELP! Phase 2 ‘JOBS JOBS JOBS’ Phase 3 STRATEGIC AND CO-ORDINATED Lessons learned from earlier regeneration efforts. More strategic analysis. Involves a process of stock-taking and tailored policies developed. Phase 4 MAINSTREAMED AND SUSTAINABLE Regeneration activities become mainstreamed across all service areas. They are less dependent on external funding and set piece projects. More focus on difficult social issues. Central/EU Funding LA Learning Curve

20. 20 Recession – early impact Rising caseloads – benefits even more important to more people New customers –Not used to the system –Not used to long forms, multi agencies, delays –Well motivated to find work in early days of unemployment Expectations of public services Links to wider outcomes – getting people money quickly and accurately helps to give confidence to take work Mortgage pre action protocols Funding for national debt advice Court desks for those facing repossession LA economic assessments

21. 21 Our challenge to you What is happening where your tenants live and work? How have they been affected? Have you got an appropriate response in place? CLG guidance to LAs on homelessness - April CLG and TSA joint guidance to Housing Associations – May CLG total Place Pilot National reporting on Economic development What does your website say and how to you regularly communicate what you are doing to support tenants in the recession?

22. 22 Yvonne-davies@audit-commission.gov.uk 07814 976326 Thanks for listening More information….. Yvonne-davies@audit-commission.gov.uk 07814 976326 National studies: crunch time www.audit-commission.gov.uk/nationalstudies Good practice www.audit-commission.gov.uk/housing/goodpractice