How are local areas responding to welfare reform?

Across the country councils and voluntary sector organisations are preparing for the impact of welfare reform on their local communities. Matthew Jackson rounds up the initiatives and asks, is it enough?

The government is currently undertaking the biggest shake up of the UK’s welfare system in over fifty years. The welfare reform act 2012 is now in force and through it, government hopes to reduce the UK’s welfare benefit costs by £18bn over the next five years (further savings to the value of £3.75bn were announced in the 2012 autumn statement) and promote work as more beneficial than claiming benefit.

Embedded in the act are a range of measures designed to simplify, streamline and reform the payment of out of work, income, housing and disability related benefits; re-assess the fitness or otherwise of claimants to work; and provide employment-related support.

Universal Credit will be introduced in October 2013 but from spring and summer 2013 local communities will start to feel the impact of other measures including so-called ‘bedroom tax’, the replacement of the Disability Living Allowance by Personal Independence Payments, and the devolution of the Social Fund to local authorities. The replacement of council tax benefit with new local schemes, changes in the way the Local Housing Allowance is allocated and roll-out of the benefit cap will all impact local communities.

The Centre for Local Economic Strategies (CLES) undertook research on the impact of welfare reform in Greater Manchester on behalf of the Greater Manchester Housing Providers Network. The research uncovered fears that communities would ‘break down’ as people are forced to re-locate to smaller properties and residents who said they would cut down further on food and fuel to cope with the changes, increasing fuel and food poverty. It also reported a significant impact of the reforms on local economies, with every £1 in reduced benefit payment to an individual leading to a reduction of 80p in spend in the local economy in shops and services, which has implications for  already ailing town and district centres.

In a separate piece of work CLES asked local authorities to identify the proportion of the local population impacted by welfare reform and to highlight specific groups. The results offer a snapshot of the impact of reform on areas of the country:

It also pinpointed the types of people most likely to be effected by the changes. Large families, disabled people and lone parents are impacted most heavily across the board but in some areas particular groups will be affected more heavily. Women will be more heavily affected in Hackney, for example, and working families will be affected in Plymouth, Portsmouth and Greenwich.

So what are local authorities, housing organisations, and voluntary and community sector organisations doing to respond? This article explores the strategic and delivery response of key local stakeholders. The responses and case studies have been drawn from two pieces of research undertaken by CLES: one with Manchester Council; the other with member organisations of the Housing Diversity Network. The responses of local government and housing organisations can be themed as follows:

The first action of many local authorities has been to set up new – or boost existing – cross-departmental welfare reform groups involving partners such as Jobcentre Plus and social landlords. Nottingham Council, for example, has adopted a city-regional approach, with a particular focus on localisation of council tax support.

Bristol Council has set up a corporate welfare reform group which has already carried out research on the number of people and locations impacted by welfare reform, with the next steps being to work directly with external organisations, such as advice agencies, to ensure the support offered helps residents.

Housing organisations have also sought to develop internal and place-focused welfare reform co-ordination groups. Places for People, for example, has set up a welfare reform group which cuts across departments such as neighbourhoods, income collection, and individual support and have produced an associated welfare reform action plan. Two dedicated officers have been recruited to inform the activities of the group and those tenants at risk from welfare reform.

Many local authorities have upped their relationships with customers to ensure they are fully aware of the welfare reform changes.  The first stage of this has been research and intelligence gathering, to seek to identify those who are most at risk and in need of the greatest levels of support and advice.  Authorities have then moved quickly to communicate,  via telephone and advice centres, what the welfare changes mean for those customers.  There has also been the development of online mechanisms of communicating the changes to claimants once they are fully implemented. The welfare reforms are also leading to an increased digitalisation of welfare information and information around benefit changes and payments. The challenge here is for those individuals who do not have access to the internet.

Once customers have been informed of the nature of the welfare reform changes, local authorities are then providing claimants with information about the types of support available from the authority itself and partner organisations.  Hackney Council is working with the NHS, Jobcentre Plus and Citizens Advice Bureau to provide this information.  This is being supplemented by work internally with specialist teams such as Drug and Alcohol and Supporting People.  Some authorities, such as the Brent, have been successful in attracting funding from the DWP Local Housing Allowance transition pot to facilitate such communication.

Essex Council has been raising awareness of debt advice so customers do not fall into the trap of high interest loans. Cheshire West and Chester Council, through the Helping Hands Project, have offered a personalised approach by visiting claimants and identifying their needs. In Manchester a ‘task and finish’ group has been established to produce guidance for residents and staff in the form of a ‘Helping Hands’ leaflet distributed to all council tax or housing benefit claimants, which detailed employment, training and advice services. In Manchester, local mental health and employment networks have also been established to raise awareness and inform people of changes.

Service reconfiguration has also included changing the use of council facilities. One example is Plymouth Council, who recognised that their own buildings could be used to provide a much broader range of advice and support.

Housing organisations are also seeking to offer advice and support around welfare reform. This ranges from simply putting posters up about the changes in housing offices to offering targeted support around under-occupancy and employment, for example. Some housing organisations are seeking to balance advice around benefits and debt with wider more targeted floating support around budgeting or training and education.

Given the complex nature of the reforms, many local authorities have sought to provide specialist training for staff. Specialist training is being delivered for frontline and management staff by Brighton and Hove Council describing reforms and exploring implications. The training is also being used to shape wider service commissioning strategies. In Manchester, they are preparing for welfare reform through training sessions for council services and partner organisations, especially mental health providers, and with a guide on re-assessment. Another response is building the capacity of partner organisations to respond. This is mainly in the public sector but also in the voluntary and community sector.

Housing organisations have changed their staffing structures to reflect the welfare reforms. This has included the restructuring of policy and performance teams as a result of reductions in regulation requirements and the emergence of more targeted advice services around benefits, under-occupancy, debt, and employment support. Many housing organisations – such as the Bernicia Group – have recruited specialist welfare reform and tenancy support officers and bulked up financial inclusion teams.

Portsmouth City Council has been working in partnership with local housing associations to develop capacity around advice services. The main purpose is to reduce potential rent arrears resulting from housing benefit changes. Manchester Council has also done capacity building in its existing training project ‘Step Up’. This is delivered by a local housing provider and has been extended to include employment and benefits support, housing advice and homelessness prevention. Manchester Council has also commissioned peer mentoring services for people undergoing work capability re-assessment. The aim is to raise the capacity of voluntary sector organisations by training staff to deliver support, particularly for people with mental health problems, and to support progression into employment.

Housing organisations are also working in partnership with voluntary and community sector organisations such as Citizens Advice to refer tenants for further and wider support. Housing organisations such as Durham City Homes are also making tenants aware of the affordable finance that credit unions can provide which is one of the ways of maintaining frequent payment of rents and discouraging loan sharks. Some credit unions are co-locating in housing association offices.

Some authorities have focused on employment support and job creation, which reinforces the government’s approach that work is the best route out of poverty. Schemes have included employment advisers using alternative locations other than Jobcentre Plus offices. An example of this is placing Jobcentre Plus family advisers in local children’s centres, which was a strategy deployed in Greenwich.

Greenwich has been reinvigorating the housing market by bringing unoccupied housing back into use. These physical development schemes are key to mitigating the impact of housing benefit changes, and may help stop the increase in people being displaced or having to move. Another scheme adopted by the Association for Greater Manchester Authorities (AGMA) is a Local Housing Allowance Transition Team, who work with tenants and landlords to negotiate cheaper rents, and also provide support for people moving.

One of the biggest barriers for social housing tenants with the welfare reforms will be its digital element. It will require tenants to have bank accounts, be more responsible for budgeting, and use the internet to transfer to universal credit. Housing organisations are seeking to address the digital divide by simplifying the way in which tenants can pay their rent, including accepting payments over the phone.

It is evident that the government’s reforms of the welfare system are having a key impact on individuals, communities, local economies, and service providers. What is also evident from CLES’s research with local government and housing providers is that the response to welfare reform needs to be coordinated across the public, commercial and social economies. If the response is to be undertaken in a way which is reflective of the need to both support and advise claimants and also create employment opportunity then the relative skills of local government, housing organisations and business must be integrated.


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