White Paper on Universal Credit

Written Evidence Submitted by Knowsley Metropolitan Borough Council

Universal Credit: Welfare that Works.

1.0 Background

1.1 Knowsley Metropolitan Borough Council is one of five Merseyside Authorities in North West England. Knowsley is a diverse borough with a mix of rural and urban areas all of which carry the need for a flexible approach to customer service. The make up of the borough is diverse and presents a number of challenging issues which include: high levels of deprivation and crime, poor health and high unemployment.

1.2 The Benefits Service in Knowsley achieved an Excellent rating against the Department for Work and Pensions Performance Standards in 2005. Since the introduction of the Audit Commission Key Lines of Enquiry in 2008 significant work has been undertaken to align service aims and objectives with wider corporate and community targets in order to promote Knowsley’s vision as the Borough of Choice and its aim of Improving Peoples Lives.

1.3 Knowsley Council recognises the value of joint working and views its Benefit Service as a prime example of how central and local government can work together to achieve the shared objectives of reducing worklessness and the eradication of child poverty.

1.4 We welcome the opportunity to support a reformed welfare system that simplifies the benefits system and supports people out of poverty and into employment. However we are concerned that the areas identified in the White Paper, "Universal Credit: Welfare that Works" are merely the difficult or contentious areas that the Department for Work and Pensions may find it difficult to deliver, rather than a desire to work in partnership with local services. Additionally we are concerned that local authorities will not have sufficient resources available to deliver these services effectively and that, unless there is an absolute commitment to data sharing and accountability, our residents will be left unsupported.

1.5 "Universal Credit: Welfare that Works" suggests that there are a number of areas where local authorities could work with the Department for Work and Pensions to deliver the Universal Credit. These include:

· Delivering face to face contact for those who cannot use other channels to claim and manage their Universal Credit.

· A localised Council Tax.

· Processing non-mainstream Housing Benefit cases (for example, people living in supported or temporary accommodation).

· The administration of discretionary payments to replace Crisis Loans.

2.0 Delivering face to face contact.

2.1 The White Paper identifies that the current system is inefficient and complex with customers unsure about who they need to contact and having to provide the same information to a number of different departments. A genuine commitment to data sharing where information is held centrally but shared with local partners could resolve this problem and at the same time reduce fraud and error. Local Authority processing systems already pass data to the DWP via the Single Housing Benefit Extract (SHBE) and IT services have committed to national security systems and are now fully compliant with GCSX. There is no reason why data could not be shared between central and local systems using this functionality. The success of data matching has already proven that national systems can provide valuable data to be used at a local level.

2.2 In Knowsley we have made significant progress sharing data internally to create a single service that uses personal data to process entitlement to a range of means-tested benefits. As a result, our residents claiming Housing or Council Tax Benefit can also have entitlement to Free School Meals and School Uniform Grants or contributions towards Domiciliary / Residential Care assessed without the need to complete a separate application form or provide information already held by the authority to more than one department. This partnership approach could easily be replicated between central and local services.

2.3 For some customers, the internet will provide an accessible and simple channel for claiming welfare support and there is no doubt that an automated self-serve system could reduce the overall cost of welfare support. However, it should be recognised that a significant number of people will be unable to access help and support in this way and the local authority could work in partnership with the DWP to support more vulnerable customers. We already have the infrastructure to support face to face contact from residents through four One Stop Shops which are located across the Borough. Advisors in the One Stop Shops are already trained to support and advise residents to access housing / council tax benefit and could easily provide face to face advice in relation to the Universal Credit. We also have a team of highly trained and experienced Welfare Benefit Advisors who provide a visiting and outreach service to our more vulnerable customers. Our experience of this Team working with Lone Parents moving into employment has shown that customers in receipt of benefit for significant periods of time need personalised support to cope with the transition from benefit dependency to employment. In Knowsley our partnership with Lone Parent Advisors at the local Job Centre has produced significant positive results and we would be happy to share our experience of how commitment to partnership working between departments can make a real difference.

2.4 Closer working arrangements between local and national services with a commitment to data sharing would reduce duplication and increase efficiency but only where both parties are truly committed to working together. Delivering face to face contact for those who cannot use other channels to claim and manage their Universal Credit would only achieve positive results if the front line local authority staff were able to fully interact with back office processing staff at the DWP. Customers generally want to speak to the person processing their claim, front line services that are unable to resolve a query at first point of contact add nothing to the service.

2.5 There is no doubt that the benefits system needs to be simplified and that supporting people to move away from benefit dependency can be beneficial to both individuals and communities. However, the proposals in the White Paper fail to recognise that these networks are currently in place and working well at a local level.

2.6 In Knowsley, the Benefits Service has strong links to services already supporting customers to access training and employment opportunities. Partnership working with our own Housing Strategy service has helped to reduce the number of residents registering as homeless and has had a significant influence on the development of support schemes including Mortgage Rescue and Rent Deposit Bond Schemes.

3.0 A localised Council Tax

3.1 It is difficult to envisage how this could work without more details from the Government. It is clear, however, that funding will be reduced by 10% and as a result local authorities will need to put more resources into collecting Council Tax from residents with limited resources. This immediate 10% cut in Council Tax Benefit will also obviously affect customers who rely on this benefit for help towards their annual Council Tax bill. Without the detail of how a local scheme will work, it is impossible to calculate who will be affected or by how much. However, it is concerning that this reduction will be on top of other welfare benefit reductions which will add to financial hardship for local residents.

3.2 A local scheme will inevitably offer different levels of support in different local authority areas. Instead of simplifying the system for Council Tax benefit, this is likely to lead to greater complexity and confusion, particularly where customers move between local authority areas.

3.3 The implementation of the Universal Credit relies on the development of IT systems that can share data and pay benefit to both customers and housing providers. This technology already exists in local authorities and could be enhanced to process additional benefits at minimal cost. The White Paper advises that any new administrative burdens will be funded by the Department for Work and Pensions but also suggests that local authorities should use existing delivery channels. A significant proportion of the current administration grant for Housing and Council Tax Benefit is spent on IT systems, if this funding is no longer available it is difficult to envisage how these systems can be retained.

4.0 Processing non-mainstream Housing Benefit cases (for example, people living in supported or temporary accommodation).

4.1 Claims for Housing Benefit from customers in supported or temporary accommodation are complex and difficult to administer. There is no doubt that local authorities are best placed to administer these cases as residents in these schemes normally access other local authority support services such as housing support and/or care packages from local authority social services.

4.2 As noted in paragraph 3.3 above, systems to process these claims may not be available to local services if funding is withdrawn. There is also an issue regarding the funding of housing support for these cases as under the current subsidy schemes they do not always attract 100% funding.

5.0 The administration of discretionary payments to replace Crisis Loans.

5.1 As with the localised Council Tax, is it difficult to envisage how this would work without more detailed information from the Government. The White Paper does indicate that an amount of information would be shared between the DWP and local authorities and this would be crucial if crisis loans were to be administered at a local level.

5.2 If the local authority were to administer a discretionary support fund for its residents, there must be a robust and transparent method of distributing funding to ensure that sufficient support is available in the most deprived areas.

5.3 It is unclear why this function would be separated at all from the Universal Credit. Local authorities currently administer Discretionary Housing Payments which support customers with housing issues, however, this is directly linked to Housing and Council Tax Benefit and is used to support customers to retain or move to sustainable tenancies. If the ethos of the Universal Credit is to support customers to move into employment and reduce benefit dependency this should form part of that support rather than a single one-off cash payment that presumably would need to be repaid in some way.

6.0 Summary

6.1 The decision to administer the Universal Credit centrally is disappointing. The debate on localism, locally delivered public services and empowerment to local communities has been totally ignored. Local authorities, and specifically Knowsley Council, have made significant improvements in the way Housing and Council Tax Benefit services are delivered achieving significant service improvements through innovation, partnership working and the use of technology.

6.2 Acting as a conduit between national and local priorities, local authorities are able to tailor services that work best for their residents. This does not happen at a national level. We would urge the Committee and the Government to re-think the role local authorities could have in supporting welfare reform.

6.3 Decent housing and access to training and employment opportunities are key to improving peoples lives, reducing crime and improving health. Local delivery has proved itself to be responsive, flexible and innovative, able to change to suit the diverse needs of residents and accountable to them for results. For many, access to welfare benefits will provide the temporary financial help they need whilst they can find new employment. For others a more intensive support network will be required and this can only be provided at a local level.

6.4 If the local authority is to have a role in the administration of welfare support crucial to the lives of its residents, there needs to be an absolute commitment to partnership working. A system could be devised where data is collected, stored and processed centrally but delivery must be devolved to local services where support can be focussed where it is needed most and services can be coordinated to ensure the best possible outcomes.

December 2010