HC 576 Progress towards the implementation of Universal Credit

Written evidence submitted by East Riding of Yorkshire Council

1. The proposed arrangements for claims and payments and the provision of support and advice for claimants, including the presumption of a predominantly online, self-service claims process; monthly payment to one person in the household; and arrangements for providing telephone and face-to-face support and independent advice for claimants who need it.

1.1. East Riding of Yorkshire Council covers in excess of 930 square miles; it is a predominantly rural area with over half of the population of approximately 330,000 living in dispersed rural communities. Many of our residents do not have access to the internet and there are significant areas where broadband access is poor or non-existent. Many of these customers are therefore used to, and reliant upon, visiting their local customer service centre to make a claim for benefit (or to seek advice about their claim) with one of our advisors or making alternative arrangements for internet access by visiting their local library.

1.2. The flip side to the above is that customer insight has shown that in some of our more deprived areas although there is access to broadband, and connectivity is not an issue, the level of take up is extremely low. It is these residents who are most likely to be Universal Credit customers, so by insisting on digital by default there are concerns that the most vulnerable customers wishing to claim the benefit will be significantly affected.

1.3. There are 14 Customer Service Centres (CSC) across the East Riding and the grid below shows how customers have made their housing and council tax benefit claims for the period February 2012 to July 2012.

1.4. Our customers are offered an assisted claiming method using our e-Benefits product. The customer attends our CSC and completes an assisted electronic claim. It is at this stage that the evidence is requested from the customer. We introduced this method of claiming because our research showed that customers preferred the face-to-face contact and/or did not have immediate access to the internet.

How claim made

Number of new claims


On-line claims






Paper claim form handed into the CSC



Paper claim form by post



Total claims



1.5. The table above shows that if face-to-face claiming/support were to be withdrawn when Universal Credit is introduced, this would potentially have a detrimental effect on the number of customers claiming. A result of this may mean increased hardship for our customers, increased rent and council tax arrears and possibly increased numbers of evictions due to customers not claiming their entitlements. This may be because they are unable to access the on-line systems because of lack of internet availability, or personal circumstances (such as learning difficulties).

1.6. A particular concern of the council is that if on-line claiming is the only option would the LA be expected to place internet points in our CSC for access and offer assisted support? If that were to be the case, there is a concern around where funding would come from for this.

1.7. For the period February 2012 to July 2012, there were over 34,000 contacts from housing benefit claimants in the East Riding requiring face-to-face support or advice at one of our CSC’s. This accounted for 23% of the queries received across the CSC network. There are concerns about how the DWP will deal with the level of enquiries anticipated, when there will no longer be a face to face service available.

1.8. The UC guidance states that customers will start to receive one monthly payment directly into their bank account and will not be advised on how the payment has been calculated or broken down. Currently payments of rent to customers living in council housing are sent automatically to their rent account and no money is paid directly to them.

1.9. The council clearly has a concern about whether these customers will pay their rent to their account. Some of our customers have been in receipt of housing benefit for years and are not aware of how much their rent is and have never been responsible for managing their accounts. There are concerns about how these customers will handle this change with no face to face intervention. We also have concerns relating to the changes to under-occupancy in the social rented sector from April 2013 and how this will impact on rent collection rates, particularly when coupled with the introduction of Universal Credit.

1.10. Our current Local Housing Allowance (LHA) caseload at 31 July 2012 is 8637 (from SHBE). From the table below we can demonstrate the effect direct payment has had on private landlords since the introduction of LHA.

LHA claims


Direct payment to landlords


12.97% paid to landlord

319 – more than 8 weeks in arrears

19 – to secure new tenancy

782 – vulnerability




We expect a similar scenario to occur in the social rented sector when universal credit starts.

1.11. Currently customers are aware of how much housing benefit is paid to them to help towards their rent payment. There are concerns around a single monthly payment being made and the fact that UC will not be broken down, and given that, the issues with the customer being able to work out the rent element and make the correct payment to their rent account.

1.12. East Riding of Yorkshire Council attends the Support and Exceptions Working Group with the DWP, looking at how customers might be supported when UC commences. A major issue, which is currently unresolved, is the issue of making payments if the customer falls into rent arrears, in particular where the rent element may be paid directly to the landlord and the remainder of the UC to the claimant.

1.13. If the customer falls into arrears, there are concerns about how payment will be made to the LA rent accounts. The arrears may impact on collection rates for the LA and also increase rent arrears in the private sector.

1.14. The council would be interested to know how the claimant’s entitlement will be notified to the LA, particularly for the assessment of Council Tax Support.

1.15. As a council, East Riding has had excellent liaison and links with the private rented sector, we would hope that the DWP continue this.

1.16. The single payment per household means there is a possibility of increases in domestic violence and abuse. Where there is a controlling person within the household, this could lead to distressing situations for other members of the household including children. If the local authority is to provide face to face support for these households we consider that we would need an increase in funding.

2. Progress with developing the necessary IT systems to administer Universal Credit, including the real-time information (RTI) system for PAYE taxation being developed by HM Revenue & Customs.

2.1. The DWP are stating that the universal credit IT systems will be integrated with HMRC so that real-time data can be sent to process any relevant changes in the customers circumstances. We are concerned that no consideration has been given to LA’s in this process. If real-time information is passed to LAs through ATLAS, LAs will struggle to cope with the increase in change of circumstances which would be reported. Many of our customers will not be able to budget or plan ahead if their universal credit amount changes every month which in turn affects their council tax benefit.

2.2. The introduction of ATLAS has already caused considerable strain upon LAs processing the additional changes which the customers do not report, if they have to process extra work, then consideration needs to be given to increasing staffing and budgets and how changes in Universal Credit will be reported to LAs. We would hope that this would not remove the onus from the customer to report changes in circumstances directly to the LA.

2.3. Many of our staff are worried about their future positions, if they start to look for alternative employment we would have to recruit new staff and this takes time to train. We would expect the support and budget from the DWP to be increased for this.

2.4. We would like to know how far the changes reported would go back to as retrospective changes to entitlement to CTB/HB, when we no longer administer these benefits, would be impossible.

3. The proposed arrangements for the "claimant commitment", sanctions and hardship payments

3.1. This will have a significant impact on the processing of Council Tax Support and existing HB claims. If stricter sanction rules are in place, we will have to gather more information regarding the customers circumstances than we do now. Any sanctions will have a significant impact when monthly payments are in place and this may in turn increase the amount of customers applying for discretionary housing payments or crisis loans from their local authority. Sanctions could also impact adversely on the council and landlords in terms of council tax and rent collection rates.

3.2. If sanctions were already in place, this could affect the Local Authorities ability to recover council tax arrears from Universal Credit. If council tax is not recovered, the council is not able to fund all the services it provides and this affects all its residents, not just those claiming benefits.

4. Changes in the income entitlement of disabled people under Universal Credit, including those who may receive less income under Universal Credit than at present.

4.1. This will increase the amount of customers applying for discretionary housing payments or crisis loans from their local authority. Again it will impact on the council’s ability to collect rent and council tax as these customers will not have the ability to pay. This may lead to increased rent arrears, evictions and homeless applications but the council may not have the housing stock available with the specialist adaptations needed to rehome disabled customers. There would therefore be an increase in demand on the council’s benefit and money advice team.

5. The impact of the changes on local authorities, including budgets, staff and support for claimants. The changes include those to Housing Benefit; the introduction of the benefit cap; and localisation of council tax support.

5.1. The biggest concern for local authorities is the impact of the changes to Universal Credit on us. Admin grants for administering housing benefit will be reduced however there will still be a need to gather information as we currently do in order to administer council tax support. With the uncertainty that surrounds the council’s role in Universal Credit it is likely that we will end up with skills gaps as staff look to secure their future and move out of benefit jobs.

5.2. If, following the initial introduction of Universal Credit, the role LAs play in delivering changes, we could easily end up in a position where we have to recruit staff following the earlier reduction in staff numbers. The cost and resource implications of having to do this would no doubt fall on the LA in a time when we have to find savings.

5.3. We have already identified that the information provided to us for the Benefit Cap is incorrect, yet we have been advised not to inform the DWP of the discrepancy. We would like this to be corrected soon. If we were to contact customers now from the data scan provided we may be contacting customers who are not even affected by the change. We would also like to know who will work out the benefit cap as this appears not to have been decided yet.

5.4. In order to work out the benefit cap, the LA would need to start holding data which is currently not needed, which would require an extreme amount of work on the LAs part. Again, these customers will come into the CSC for help and support not the DWP as they will not offer face-to-face support. We are greatly concerned that we do not have the staffing or funding to accommodate this. We would need specialist staff available who can aid with employment, re-housing etc at one point of contact.

5.5. As stated earlier East Riding of Yorkshire Council has worked extremely hard over the years to develop its benefit and money advice service which was recognised nationally when winning the IRRV award for excellence in social inclusion. The work of the team was seen to be exceptional and the positive impact of the work of the team is felt by our residents. Our experience of dealing with vulnerable people leads us to believe that without a similar level of support, residents will find themselves in financial difficulties and in fear of being made homeless. The push for a predominantly on line provision goes against our knowledge from dealing with the most vulnerable customers. Many of our customers do not choose to make contact with our team. They are referred from other departments and organisations.

5.6. The reduction in funding for external advice organisations has led to a reduced independent advice provision which will impact further on demand from the council for face to face advice.

6. Eligibility for and operation of passported benefits.

6.1. Entitlement to passported benefits automatically entitles a person to free school meals, clothing grants, free prescriptions, a sport and leisure concession at an east riding leisure centre and full council tax benefit. We are concerned that we will not be able to identify these customers in the future if passported benefits no longer exist. We may have to rely on the DWP to advise us of eligibility but this could be very unpredictable. The loss of passported benefits will make it significantly harder for customers to understand their eligibility and many may under claim. It will also make it more difficult for advisers to maximise their customer’s income and sign post to all entitlements.

6.2. ERYC have carried out significant work to ensure swift processing of free school meals (FSM) so that the welfare of children is not affected. As a LA we are pro-active with assessing FSM, if we no longer administered them we could potentially lose out on the pupil premium for our Schools Education System.

6.3. As passported benefit automatically entitles a person to maximum eligible rent and council tax, we would assume that the same will apply for Council Tax Support. However, we would either have to rely on the DWP to advise us of a customer’s income or we would need to collect income separately and duplicate the work the DWP have done for UC as they are separate claims. This wouldn’t be simplifying the benefits system. Perhaps the LA could be advised whether the Universal Credit award was an in or out of work claim.

7. Impact monitoring: what the DWP’s priorities should be for monitoring the impact of the transition to Universal Credit.

7.1. The DWP should ensure that monitoring is in place to establish the impact of Universal Credit on LA’’s rent and council tax arrears and collection rates. Homeless prevention and domestic violence interventions and eviction rates will also provide valuable information on the impact.

7.2. We would also expect the DWP to monitor application numbers to the LA for DHP’s, crisis loans and social fund grants and the level of staff needed to process these applications.

7.3. As one of the aims of Universal Credit is to simplify benefits, then monitoring the number of and frequency of UC and CTS overpayments especially in relation to real time information will evidence if this has actually been achieved.

8. Summary

8.1. East Riding of Yorkshire council is very concerned about how our most "vulnerable" residents will cope with the transition from their existing benefits to universal credit. Our main concerns are -

· Broadband access is limited as East Riding of Yorkshire is a rural area

· Internet take-up is limited in the most deprived areas of our county

· Huge increase in customers visiting our customer service network needing help to claim UC

· The monthly UC payment will not show a breakdown of amounts particularly the rent element

· Customers will not pay their rent or council tax and spend their monthly payment as soon as they receive it

· Increased applications to the council for social fund loans, crisis loans, dhp’s and the council tax discretionary fund

· No information supplied directly to the council by the DWP in order to process CTS or FSM applications

· Frequent changes in UC payments due to the real time IT system leading to multiple changes in circumstances recalculations of CTS creating small over and underpayments generating multiple council tax bills during a financial year

· Loss of experienced benefit staff as no clear role for LAs in the administration of UC

· Lack of public knowledge or understanding of UC may cause under claiming and increase poverty

17 August 2012

Prepared 7th September 2012