Further information from DWP (PC 01A)
A. When will the number of Pension Centres
be reduced to 19? Exactly how many more reductions are planned
and what is the schedule for these?
When will the number of pension centres be reduced
to 19?
The transfer of the six pension centres to Jobcentre
Plus, (Derby, Norwich, Nottingham, Stockton, Wolverhampton and
Wrexham) is planned to be complete by the end of 2006. Derby will
be the first site to complete the transfer to Jobcentre Plus which
is planned to be by April 2005.
Our current planning assumption is that Burnley
Pension Centre will transfer to The Appeals Service by the end
of 2005-06.
The transfer of Plymouth Pension Centre to the
Child Support Agency is progressing well and is planned to be
complete by April 2005.
The two remaining pension centres, that formed
part of the DWP announcement on efficiencies in June, York and
Liverpool, will close during 2005-06 unless we can find an alternative
use for them.
How many more reductions are planned?
A strategy is in place for modernising The Pension
Service so that it delivers a much more effective, holistic customer
service, provides more satisfying jobs for our staff and significantly
reduces our costs to the taxpayer. The effect of implementing
this strategy will create surplus capacity, (in terms of estate,
staff and service capability) which The Pension Service will not
need. The precise level of surplus capacity created will depend
on how much of our current business we can modernise and this
is dependent upon how much investment money is available to us
over the next spending review period.
B. The Public and Commercial Services Union
have told us that some people have already lost their jobs as
part of re-clustering in the Local Service. Could the Department
provide the Committee with details of the positions being cut
and the Local Services being merged?
As part of the modernisation programme, there
have been a series of boundary changes to the existing clusters
in Local Service in order to better align us with local authority
boundaries throughout the country and achieve a better distribution
of work. The aim of this was to facilitate referrals and partnership
working and enable us to deliver a more efficient service to older
people.
The existing Local Service network of 165 clusters
was re-organised into 133 clusters, with the new structure determined
through analysis of a mixture of factors eg pensioner population
and the number of local authority relationships a cluster has.
No one factor was given more weighting than another and the new
clusters were designed to ensure an even distribution of workload.
There is a commitment for The Pension Service
to reduce headcount as part of the overall Department for Work
and Pensions Efficiency Challenge announced by the Chancellor
in February 2004. As a contribution to this commitment, Local
Service is currently reducing staffing levels through staff transfers
and normal wastage.
All management posts in the new Local Service
structure were advertised to the existing 188 Local Service Delivery
Managers. Thirty three chose not to apply and seek employment
elsewhere in the Department. A further 22 were unsuccessful in
their application for the Local Service Delivery Manager posts
and were also made available for redeployment elsewhere within
the Department.
There are defined procedures for managing sensitively
those people who became available for redeployment, and these
procedures have been subject to Trade Union consultation. Eleven
of the Local Service Delivery Managers available for redeployment
have now found alternative employment.
Graham Carter, National Local Service &
Partnership Director wrote to partners to inform them of the changes—see
Annex A.
C. What adjustments would the Department have
to make to its planned efficiencies if it were to increase its
target for take-up—for example, aiming for 3.825 million
households to be claiming Pension Credit in 2008?
Current plans are based on achieving a demanding
PSA target of 3.2 milion households in receipt of Pension Credit
by 2008. If this target were raised to such a significant extent,
the implications for the Department's Spending Review settlement
would need careful assessment, supported by further detailed analysis.
However, it can be anticipated that the increase in the marginal
effort required to identify and successfully convert potential
new customers to Pension Credit at these high take up levels would
be substantial, with a corresponding impact on our resource requirement.
D. Could the Department name the 18 local authorities
where joint teams are in operation?
There are now 25 Joint teams in operation:
2. South Gloucestershire (Unitary)
4. Bournemouth Borough Council
6. Swindon Borough Council (Unitary)
7. North Somerset (Unitary)
8. BANES Council District
9. Wiltshire County Council
10. Gloucestershire County Council (Partial)
13. East Sussex County Council
14. Nottinghamshire County Council
16. West Lothian (Unitary)
17. Derby City Council (Unitary)
18. Nottingham City Council (Unitary)
19. Reading Borough Council (Unitary)
24. Poole Borough Council (Unitary)
25. Portsmouth City Council (Unitary)
High level agreement at senior management level
has been achieved with well over half of all Primary Tier Local
Authorities. Also, positive and constructive conversations have
been held with the Welsh Assembly and Scottish Executive.
E. In what percentage of Pension Credit applications
are incorrect amounts awarded? What percentage of applicants wait
more than six weeks for their application to be dealt with after
sending all the necessary documents to the appropriate Pension
Centre? What is the average length of these delays?
The data requested is not available in respect
of Pension Credit. We have a commitment that on average, 96% of
Pension Credit applications are paid correctly by 2006. Figures
on the proportion of cases checked for official error that were
found to be financially correct during the period October 2003
to March 2004 are to be included in the Autumn Performance Report,
due to be published at the end of November. These figures have
not been subject to independent or Department for Work and Pensions
Internal Audit validation. Estimates of the number of incorrect
cases at any given time are published annually in National Statistics
reports. These figures take account of incorrectness as a result
of official error, as well as fraud and customer error. They give
an estimate of the number of cases across the country being paid
incorrectly at a given time but not how many applications originally
awarded the incorrect amounts. The next set of figures in this
series is currently scheduled to be published in March 2005 and
will cover cases in the period April 2003 to March 2004. We have
a commitment to reduce overpayments through fraud and error, with
a 20% reduction by 2006 against the 2001-02 Minimum Income Guarantee
baseline.
Data is not collected on delays in the format
requested.
F. In response to a question about take-up of
Pension Credit, the Secretary of State said that figures available
to the Department on the amounts of Pension Credit being claimed
suggest that "we have got 100% of the poorest pensioners."
We would be grateful for details of: the estimated median and
mean amounts being unclaimed. It would also be useful to get an
idea of how many are not claiming small amounts and how many are
not claiming larger amounts. If possible, for example, it would
be useful to have details of the number of pensioners, classified
by couples, single men and single women if possible, who are not
claiming and whose entitlement to the Pension Credit is estimated
to be (i) less than £5 a week; (ii) £5 or more but less
than £10 a week; (iii) £10 or more but less than £20
a week; (iv) £20 or more but less than £30 a week; (v)
£30 or more but less than £40 a week; (vi) £40
or more but less than £50 a week; (vii) £50 a week or
more.
The Secretary of State's remarks were made in
the context of broad brush assumptions based on comparing numbers
of households in receipt of Pension Credit with operational estimates
of the numbers likely to be entitled based on the Family Resources
Survey 2001-02. Using these assumptions the indications are that
the number of households now benefiting by over £50 a week
has exceeded initial projections of the numbers who might be entitled
to such amounts.
More generally, evidence shows that Pension
Credit is getting most money to those who now need it. The definitive
National Statistics figures on take-up rates will not be available
for some time, but amongst all of those whose income is sufficiently
low that they are entitled to have their income topped up to the
guaranteed minimum (currently £105/wk for single pensioners),
the best estimate is that take-up rates are running at over 80%.
There are further indications that this is so.
Estimates of Pension Credit expenditure on the very poorest recipients
is already set to outstrip Spending Review projections by around
£40 million. The caseload amongst this group of recipients,
principally those on incomes at or below the basic State Pension,
is now 25,000 households up on projections at that time.
Due to technical difficulties definitive figures
of the type requested by the committee are not available. However
National Statistics publications do provide some indicative analysis
of the type requested. The most recent publication covers the
period 2001-02 and can be found at http://www.dwp.gov.uk/asd/irb.asp.
G. The Committee recognises that some eligible
non-recipients of Pension Credit may be claiming Housing Benefit
or Council Tax Benefit. Has the Department made an estimate of
the number of cases in which this happens and the extent to which
the financial loss from unclaimed Pension Credit is offset by
higher Housing Benefit or Council Tax Benefit entitlement? If
possible, for example, it would be useful to have details of the
number of pensioners (again distinguishing couples, single men
and single women) who are not claiming and whose overall entitlement
to all means-tested benefits is estimated to be (i) less than
£5 a week; (ii) £5 or more but less than £10 a
week; (iii) £10 or more but less than £20 a week; (iv)
£20 or more but less than £30 a week; (v) £30 or
more but less than £40 a week; (vi) £40 or more but
less than £50 a week; (vii) £50 a week or more.
Pensioners claiming the guarantee component
of Pension Credit are passported to full Housing Benefit and Council
Tax Benefit. Pensioners entitled to, but not claiming the guarantee
component of Pension Credit should also receive full Housing Benefit
and Council Tax Benefit. Any financial loss incurred by non-take-up
of the guarantee component will not be offset by higher housing
or Council Tax Benefit.
Pensioners receiving the savings component only
of Pension Credit have this amount taken into account as income
in Housing Benefit and Council Tax Benefit. This means that any
financial loss incurred as a result of non take-up will be partially
offset by higher Housing Benefit and Council Tax Benefit. It is
not possible to accurately estimate how many people are affected
in this way.
It should be noted that customers in receipt
of HB/CTB who are entitled to Pension Credit will be better off
overall claiming all benefits to which they are entitled.
H. What is the estimated cost of removing the
upper capital limit of £16,000 in Housing Benefit/Council
Tax Benefit for those on savings credit only?
The cost of removing the upper capital limit
in Housing Benefit and Council Tax Benefit for those receiving
savings credit only is estimated to be £90 million. There
would be an estimated 30,000 beneficiaries.
Notes:
1. Costs are rounded to the nearest £5
million and beneficiaries to the nearest ten thousand. Each beneficiary
represents a benefit unit, which can be a single claimant or a
couple.
2. All beneficiaries are "floaters
on"—in other words they are newly entitled to HB or
CTB.
I. The Department's memorandum (paras 5.12-13)
to the inquiry refers to evaluation of the hard-to-reach pilots.
If possible, it would be useful to see these.
The evaluation referred to in paras 5.12-5.13
of the Memorandum is based on a series of pilot events held in
conjunction with partner organisations in nine regions. The resulting
information collected was collated into a number of key areas.
These are target groups, different types of approach, partnership
arrangements and barriers to take-up. This work resulted in best
practice advice being issued across The Pension Service. Summaries
of the activity, targeting and the advice are provided at Annex
B.
J. How is the Partnership Fund Developing?
The Pension Service Partnership Fund was set
up using allocations from the Spending Review 2002 bid and offers
short-term (maximum of two years) funding to local and national
partner organisations to:
— Improve the take-up of older people's
benefits ( eg Pension Credit, Attendance Allowance, Disability
Living Allowance, Carers Allowance, Housing Benefit and Council
Tax Benefit ) particularly by "hard to reach" groups;
— Promote the independence of older
people;
— Integrate joint working between partners;
— Improve access to services; and
— Gain a better understanding of older
people's needs in a specific community, region or country setting
including the needs of ethnic minority elders.
The above aims were developed in consultation
with members of the Partnerships Against Poverty (PAP) group,
a joint forum which includes national representatives from organisations
such as Help the Aged, Age Concern and the Local Government Association.
The fund was launched on 1 March 2004 and the
closing date for bids was 30 June 2004.
740 applications were received by the closing
date; the majority were from local organisations but a small number
were to support national initiatives.
All of these bids were graded by a team of independent
assessors against the aims of The Partnership Fund. High quality
applications with timescales and plans were clearly and concisely
written with a direct link to benefit take up and particular emphasis
on hard to reach groups. Assessors looked for clear examples of
activities that would take place following a successful contract
award and quality scores were not given to general statements
that lacked detail, particularly applications which simply focussed
on general mailshots and publicity campaigns. Examples of partnership
working and innovation attracted extra points in the scoring process.
A shortlist was then drawn up, organised by
region, and presented to the decision panel.
Following the meetings of the Decision Panel
in October 2004, letters have now been sent to applicants.
Final decisions were based on the following:
— Quality of the proposal;
— Ensuring a reasonable geographic
distribution of activities across Great Britain;
— Involving a range of partners both
large and small; and
— Using a variety of approaches to
older people.
Priority was given to those proposals with high
quality scores and good value for money. Inevitably, the large
number of applications and the need to take the above considerations
into account meant that some applications of high quality were
not successful.
Written into each contract there will be a minimum
level of statistical data that The Pension Partnership Fund requires
organisations to record. Contractors must also provide regular
updates on the progress of the initiative. Quantitative and qualitative
data will be used to evaluate progress toward expected outcomes.
If it is evident at the end of the first year that an initiative
is not viable, the second year funding may be withdrawn.
Contracts will be sent out over the next few
weeks and the first payments will be made in early 2005. The initiatives
funded should start by next spring.
A full list of contracts awarded by The Pension
Service Partnership Fund will be made publicly available in due
course.
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