The local welfare safety net Contents

2Realising the opportunities of localisation

12.There were 2.7 million DWP Crisis Loan awards in 2011, immediately prior to localisation, compared to 1.0 million in 2006. The total value of these loans almost tripled to £233 million over the same period. Many people made multiple repeat applications: in 2010/11 alone “over 17,000 people received 10 or more crisis loans”.14 One of the main policy intentions of localising emergency elements of welfare provision was to facilitate coordination of local social, housing, health and education services and thereby better address the underlying causes of financial difficulty and reduce repeat demand.15 In this chapter we set out some examples of excellent local practice in this regard, and consider how these might be more widely replicated.

Single teams and joined up services

13.Several local authorities put forward their welfare services as examples of good practice.16 For example, Milton Keynes Council had established a single team to administer all three localised schemes, and emphasised that:

It is not necessary for the customer to concern themselves as to whether they are applying for help from the correct fund; the team will access whichever funds are most appropriate for the customer thus avoiding multiple applications. We may, for example, when considering a DHP application, find that it would assist the customer if we were able to provide them with goods to enable them to end a hire purchase agreement which would then provide the additional finance the customer needs to pay the rent themselves rather than rely on a DHP award.17

14.Jill Farrar, a Senior Team Manager at Blackpool Council, reported that Blackpool had taken a similar approach.18 The challenge of training staff on the rules of all three schemes had been overcome through the development of a relatively straightforward “toolkit for decision-makers”. Ms Farrar acknowledged that it was important for staff to follow the procedures set out in the toolkit, and keep up to date with any policy changes, but her view was that it was more important for council staff to ask the right questions of claimants and “diagnose the problem”.19 She contrasted this with the DWP’s previous approach; the Department’s Social Fund guidance was around 250 pages long and attempted to describe “every conceivable scenario, which is not always the best way to go.”20

15.Councillor Paul McGlone, Deputy Leader of the London Borough of Lambeth, expressed a more cautious view of single council benefit teams; he emphasised that emergency welfare, DHPs and Council Tax support were “different things for different purposes”. However, like other witnesses, he supported joining up the different elements of the local welfare safety net and other services. He believed this was best achieved through effective triage:

Where ever people present themselves, whether it be a food bank, whether it be a housing office, whether it be our customer service centre or the town hall, our staff are trained and they are aware of how to get them to the right person, so there is a holistic, rounded approach.21

South Norfolk District Council had a separate team which fulfilled this triage role and was also responsible for following the claim from beginning to end, to ensure resolution of the claimant’s difficulty.22

Mitigating the impacts of reductions in entitlements

16.We were hugely impressed by the success of the London Borough of Croydon in helping its residents to mitigate or avoid altogether the effects of national welfare changes. By proactively contacting claimants whose benefits were set to be reduced, Croydon not only mitigated potential hardship but also helped claimants to increase their employability and incomes.

17.Croydon had pre-emptively identified 16,113 residents who would be affected by one or more of the Benefit Cap; the removal of the spare room subsidy; and the LHA reduction. Its analysis of the potential impacts showed that these residents would lose an annual total of £8.4 million in benefit payments. If they took no action, the majority would face reductions of less than £10 per week but a significant number were facing much larger reductions in income:

Table 2: Potential benefit losses of Croydon residents affected by national welfare reforms, 2013/14

Loss of benefit (weekly)

Number affected

% of those affected

Average weekly impact per household

Weekly impact (total)

Yearly impact (total for Croydon)

<£10

12,261

76%

£3.69

£45,243

£2,358,896

10–£20

2,403

15%

£14.45

£34,729

£1,807,772

20–£30

768

5%

£24.23

£18,610

£968,420

30–£40

165

1%

£33.40

£5,510

£286,706

40–£50

149

1%

£43.50

£6,482

£337,124

50–£100

134

1%

£73.86

£9,897

£514,697

100–£200

163

1%

£136.86

£22,308

£1,160,059

200–£300

56

<1%

£249.49

£13,972

£726,544

300–£400

11

<1%

£340.76

£3,748

£194,922

400–£500

3

<1%

£436.18

£1,309

£68,045

Total

16,113

100%

£10.04

£161,807

£8,423,185

Source: London Borough of Croydon

18.Croydon council proactively contacted and engaged with 3,300 of the potentially worst affected households, referring individual residents to employment support and housing, budgeting and welfare rights advice, as appropriate, with the aim of maximising the resident’s income and encouraging them to be “financially resilient and live affordable lives”.

19.The success of Croydon’s approach is striking. Some 84% of households engaged with in 2013/14 achieved a “sustainable outcome”, defined as starting a new job; increasing working hours; securing appropriate accommodation; successfully obtaining an exemption from the relevant welfare reform; or more effectively managing the loss of income through budgeting.

Replicating Croydon’s approach

20.It should be noted that Croydon was one of four Benefit Cap pilot areas, and as such received additional assistance from the DWP in identifying and contacting potentially affected residents. Some witnesses noted the difficulty for many local authorities in analysing the potential effects of the range of national welfare changes on its residents. The Welfare Reform Club, a consultancy which assists local authorities in this work, told us that:

Welfare reform, with some changes already taking place and more to come, presents a complex picture for local authorities and their residents. These policies interact and have knock on effects, so it is important to understand the total, cumulative impact. Local authorities need to know what the impact of welfare reform measures (including Universal Credit) will be at both aggregate and individual levels. They need to identify those individual households that will be affected most by the reforms and which households are accessing a range of support services.23

21.The Welfare Reform Club noted that it is possible to assess potential effects using “proprietary software” and matching local authority HB and Council Tax support claims data. It argued that this information would be “much more powerful” if more local authorities could “integrate the range of support schemes they have on offer or at least ensure there is a read-across through data-matching.”24 Paul Howarth, Director of the Welfare Reform Club, told us that the DWP could do more to help councils achieve this, particularly helping them to understand the cumulative impacts on residents of the range of planned national benefit reforms.25

22.Local government’s potential to address more effectively the underlying causes of financial hardship is being realised in a number of local authority areas. These councils, including Blackpool, the London Borough of Croydon and Milton Keynes, deserve great credit. The transfer of responsibility to more than 150 diverse local authorities in England is a radical departure, however, and not all councils have made such a positive start. We therefore very much regret that no national Department, agency or collective body—not the DCLG, the DWP, nor the Local Government Association (LGA)—has taken responsibility for actively spreading best practice elsewhere.

23.We recommend that the DCLG and the LGA work together more actively to facilitate the adoption of best practice in the administration of the local welfare safety net. They should have a particular focus on approaches which proactively identify vulnerable people and help them to avoid unintended effects of planned national welfare reforms, and most effectively link up discretionary local welfare, housing and Council Tax support with other local services to address the underlying causes of financial difficulties. At the very least the DCLG and the LGA should jointly publish annual good practice guidance with clear studies of the most effective examples. We further recommend that the LGA facilitate secondments of staff from areas of best practice to areas where councils are performing less well.

14 HC Deb, 3 March 2011, cols 45–46WMS

15 DWP settlement letter to local authority Chief Executives, August 2012, cited in Localisation of the Social Fund, Standard Note 06413, House of Commons Library, November 2012, appendix 1

16 Including Derbyshire County Council (LCW0010); Blackpool Council (LCW0015); Southampton Local Welfare Provision Group (LCW0016); and Milton Keynes Council (LCW0028)

17 Milton Keynes Council (LCW0028)

22 Q79 [Councillor Fuller]

23 Welfare Reform Club (LCW0020)

24 Welfare Reform Club (LCW0020)

25 Q2




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Prepared 11 January 2016