Communities and Local Government CommitteeWritten evidence from the Hyde Group

1. Summary

1.1 Welfare reform presents a significant challenge to local authorities, and housing associations like Hyde work closely with them to minimise impact on social tenants and housing associations’ plans for further investment in services and new homes.

1.2 However, Hyde has a number of concerns mostly around information sharing and the changes to the Council Tax Benefit which will make it more difficult for Hyde to monitor impact on tenants and provide adequate support to those likely to be affected by welfare changes.

2. Introduction

2.1 The Hyde Group is one of leading housing association groups in England. It owns and manages over 47,000 homes across London, South East and the East of England. Just over half of Hyde tenants of working age are in receipt of full or partial housing benefit and are therefore potentially subject to reductions to housing benefit and other benefit changes, such as the total welfare benefit cap and changes to how the Council Tax Benefit system operates.

3. Submission to the Inquiry

3.1 How will the separation of the administration of Council Tax Benefit (CBT) and Housing Benefit (HB) affect claimants?

3.1.1 Hyde feels that there is a danger that some residents will assume that if they have applied for one benefit the other will be covered and may fail to apply for CTB separately to local authorities.

3.1.2 This will need to be communicated clearly by local authorities, DWP and housing providers to residents. Alternatively, providers and boroughs may wish to build-in checks so that providers can flag this up with residents.

3.2 Are there sufficient safeguards to protect social landlords from financial harm resulting from the payment of housing benefit (HB) direct to claimants?

3.2.1 Hyde welcomes the introductions of an arrears trigger which will revert payment of the housing allowance of Universal Credit back to landlords. However there are significant concerns about the lack of measures to prevent arrears happening in the first place for vulnerable tenants. The Payment Exception is looking into this and although the HA can act as a third party and request HB payment direct to it, this has to be with the consent of the customer.

3.2.2 Housing associations need to know who has a vulnerability risk. The DWP should strongly consider sharing this data with HAs so that they can make the request for Payment Exception or allow HAs to share vulnerability data with them, eg to request direct payment based on history of arrears and unmanageable debt. Such data sharing would reduce negative impact on landlords and on their tenants without additional costs to the DWP.

3.3 How effectively are the Department for Work and Pensions and the Department for Communities and Local Government working together to implement Welfare Reform?

3.3.1 There is a strong feeling in the sector that there is an inherent conflict between the two departments’ work in this area, manifested by the introduction of affordable rent of up to 80% of market rent and capping benefits to £500 per week.; and the potential to increase arrears by a switch to direct payment of HB against an expectation of housing associations to take on additional borrowing to deliver more new homes.

3.3.2 Learning from the direct payment and the Universal Credit support demonstration projects should show if this conflict can be resolved by changing the way the reforms are implemented locally. Until such lessons have been shared it would be difficult to assess the effectiveness of joint working between the two departments.

3.4 Is the Government’s timetable for implementing Welfare Reform achievable?

3.4.1 It has been widely suggested by the sector that the demonstration projects should report before the system is implemented, and that the timetable must move back to accommodate this.

December 2012

Prepared 28th March 2013