47.The Regulations which provide the legal basis for Welfare Supplementary Payments make clear that the payments can only be made until 31 March 2020. Amendments to the Regulations would be required to allow Welfare Supplementary Payments beyond this date—but the Department for Communities cannot pass amended regulations as they would need to be approved by the Northern Ireland Assembly.
48.The Department for Communities has indicated that Discretionary Support Awards, unlike other mitigation schemes, will not cease after March 2020. Since the Universal Credit Contingency Fund is paid through the Discretionary Support Scheme, payments can also be made from the Fund after March 2020 as long as there is funding in place. The contract for independent advice services is due to end in 2020.
49.We received evidence from the Joseph Rowntree Foundation, Ruth Patrick (University of York) and Mark Simpson (Ulster University) on the likely impact of ending the mitigations in March 2020. They found that the greatest adverse effects would result from the ending of supplementary payments to mitigate the Social Sector Size Criteria (“bedroom tax”/SSSC) and the benefit cap.
50.According to Department for Communities estimates, the ending of SSSC mitigation would likely affect 34,000 households, who would be worse off by an average of £12.50 per week; and the ending of benefit cap mitigation would likely affect 1,500 households, who would be worse off by an average of £42 per week.
51.The likely effect of ending SSSC mitigation can be estimated by looking at what has happened to claimants who have lost their eligibility for mitigation payments. By June 2017, 72 Housing Executive tenants had lost their SSSC mitigation payments through moving within the social sector and continuing to under-occupy (not via a Management Transfer), which ends eligibility for the mitigation payments. Of those who had lost their mitigation, there was an average cumulative arrears increase per household of £128.
52.Although the number of households receiving mitigation payments for the benefit cap is small, the effect of them ending could be very significant for those households currently receiving them. Kevin Higgins, Head of Policy at Advice NI, told us:
They are all families with children; 85% are lone parent families [ … ] If that mitigation falls it is not the same number of people as the bedroom tax but, in terms of impact, that is going to mean a real crisis for those people.
53.The Cliff Edge NI Coalition added that:
8% of capped households were capped by more than £100 per week. These figures make clear the detrimental impact the end of the mitigation package would have on families currently shielded from losses from the benefit cap.
54.When the Work and Pensions Committee looked into the benefit cap earlier this year, it found that the cap was “plunging families into hardship”:
The Department [DWP] decides whether people are entitled to benefits, and how much it thinks they need to live on. It is therefore inevitable that the benefit cap, which takes some of that money away, leaves many families without enough money to meet even their basic needs. Parents are left making impossible choices: whether to pay their rent, feed their children or heat their homes. Many experience stress and anxiety because of mounting debt and insecurity; we even heard cases of relationships breaking down and in some cases families losing their homes. Bluntly, the Government’s policy is plunging families into hardship [ … ]
55.Community Advice Antrim and Newtownabbey provided case studies illustrating the effect on claimants of the mitigation payments ending, outlined in Box 2 below.
Box 2: Case studies of ending mitigation payments
We had one client who is getting a supplementary payment for bedroom tax; she is aware of the March 2020 deadline for mitigations. To prepare themselves for this ending they have been paying extra to their rent each month. This is causing severe stress and financial hardship on this person. This is the only client we have had that has done anything to prepare themselves for the mitigations ending.
A couple who live together in a 3-bedroom property are currently getting a supplementary payment for the bedroom tax for 2 extra bedrooms they have. They are both ill and are claiming employment and support allowance. When I explained to them about the bedroom room tax and that the supplementary payment was due to end in March 2020 they responded by saying ‘if the amount of benefit we are currently getting is what the law says we need to live on, how can the government possibly expect us to take anything from this benefit to pay the shortfall in our rent’.
56.Multiple witnesses emphasised to us that it was important for SSSC and benefit cap mitigations to remain in place. Professor Evason emphasised:
What we would be particularly concerned about is that we need to continue with supplemental payments relating to the bedroom tax, and also I think the benefit cap.
57.The Department for Communities’ own review of the mitigation package concluded that:
Evidence clearly shows that the impact of this policy [the SSSC/”bedroom tax”] has not abated and is unlikely to change over the next few years with the number of affected claimants remaining largely constant. It is therefore considered that there is strong evidence to consider the continuation of this policy [i.e. mitigation payments].
[…] Alongside Social Sector Size Criteria it has been estimated that the mitigation scheme that would benefit the greatest number of claimants, were it to continue, is for the Benefit Cap.
58.Welfare Supplementary Payments other than those to mitigate the SSSC and benefit cap all relate to the migration of claimants from Disability Living Allowance (DLA) to Personal Independence Payment (PIP). The Department states that “it is expected that the vast majority of Disability Living Allowance reassessment cases will be determined by March 2019, with any outstanding cases cleared by August 2019”, and that apart from claimants who lodge late disputes and have their reasons for delay accepted or are granted leave to appeal to the Social Security Commission, all remaining disability-related Welfare Supplementary Payments would have started by September 2019. The Department concluded that the number of claimants affected by the ending of mitigation schemes at 31 March 2020 “will be extremely small”.
59.One group who will be affected, however, are what the Department for Communities calls “rising 16s”, children under 16 years old currently receiving Disability Living Allowance (DLA) who will have to apply for Personal Independence Payment (PIP) when they are 16. The Department estimate that, excluding administrative costs, that mitigating the potential loss of Disability Living Allowance on the same basis as the current mitigation package would cost £3.8 million. The Northern Ireland Commissioner for Children and Young People told us in written evidence that they could not see a rationale for excluding young people from the PIP mitigations.
60.For payments to mitigate the time-limiting of contributory Employment Support Allowance (ESA) the Department estimate that only a very small number of claimants would be affected:
only claimants who have been in receipt of Employment and Support Allowance prior to November 2016 and are then moved from the Support Group to the Work-related Activity Group could still be affected by this welfare change.
61.Even though the numbers of new claimants who would be eligible for the disability-related mitigations is small, claimants who are currently receiving mitigation payments for reduced entitlement to disability benefits would still see their payments cease in March 2020 if the mitigation package were not renewed. John, who receives PIP mitigation, told us that he could lose around £500 per month were the payments to end:
I will be £500 worse off. I do not know how that will affect me and my wife. […] I am just dreading next March when that stops. I try not to think about it, but it’s hard. I can’t not think about it. I have to think about it. Basically what I am doing now is just saving up money that I have now for when that money stops. It is just things I am going to have to cut down on.
62.Professor Evason explained that although many of the mitigations would have come to a natural end, there will be some remaining disability-related cases because of “rising 16s”:
A lot of things have washed away but we have tail-enders as well, for example, on PIP. We have young people on disability living allowance who are coming up to the PIP assessment and will not get any support, so there are various things like that, but we are not asking for a lot and it will not cost a great deal.
63.Multiple witnesses told us about their concern that the majority of claimants currently receiving Welfare Supplementary Payments are not aware that their payments would stop at the end of March 2020. For example, Housing Rights told us that:
Despite the financial consequences of loss of mitigations and the proactive work done by many social landlords around welfare reform, many claimants are unaware that they are receiving a mitigation payment. This will compound the impact of the mitigation cliff edge.
Community Advice Antrim and Newtownabbey similarly said:
After speaking with clients, [we] have realised some are not even aware they are getting a supplementary payment and certainly not aware they are due to end.
64.A survey by the Department for Communities found that 78% of respondents were not aware of the Welfare Supplementary Payments Scheme—and 69% of SSSC mitigation recipients were not aware that the payments were due to end.
65.The ending of the mitigation payments in March 2020—in particular, the ending of Social Sector Size Criteria and benefit cap mitigations—would mean that tens of thousands of households in Northern Ireland would see their incomes suddenly fall, some by hundreds of pounds per month. The impact on households would be exacerbated by the fact that many people simply would not be expecting the payments to end. Support organisations in Northern Ireland have rightly described this prospect as a “cliff edge”. None of the special circumstances that justified the mitigation package have changed in the last four years.
66.We recommend that the mitigation package is extended after March 2020, for a further four years. This should include the SSSC (“bedroom tax”) and benefit cap mitigations, disability-related mitigations already in payment, and DLA to PIP transition mitigation for 16 year-olds. We also recommend that the Department for Communities consider rolling over the contract for independent advisory services after 2020.
61 Welfare Reform (Northern Ireland) Order 2015 (as amended by the Welfare Reform and Work (Northern Ireland) Order 2016)
62 Department for Communities (2019) , p47
63 Joseph Rowntree Foundation, Mark Simpson (Ulster University), Ruth Patrick (University of York) (joint submission) ()
64 Department for Communities (2019) , p36–37
65 Department for Communities (2019) , p36–37
66 Northern Ireland Housing Executive, (2018), p45
68 Cliff Edge NI Coalition ()
69 Work and Pensions Committee, , Twenty-fourth Report of Session 2017–19, HC 1477
70 British Association of Social Workers Northern Ireland (); Mr Eddie Smith (); Advice NI (); Connswater Homes (); Community Advice Antrim and Newtownabbey (); Christians Against Poverty (CAP) (); North Belfast Advice Partnership (); Sinn Féin (); Employers For Childcare (); Housing Rights (); Northern Ireland Federation of Housing Associations (); NIICY (); The Royal British Legion (); Women’s Resource and Development Agency (); SDLP (); People Before Profit (); Cliff Edge NI Coalition (); Northern Ireland Human Rights Commission (); Green Party Northern Ireland (); Law Centre (NI) (); Church Leaders’ (Ireland) Group ()
72 Department for Communities (2019) , pp50–51
73 Department for Communities (2019) , p37
74 Department for Communities (2019) , p45
75 NIICY ()
76 Department for Communities (2019) , p36–37
79 Advice NI (); Community Advice Antrim and Newtownabbey (); Women’s Regional Consortium (); Housing Rights (); Joseph Rowntree Foundation, Mark Simpson (Ulster University), Ruth Patrick (University of York) (joint submission) (); Cliff Edge NI Coalition (); Law Centre (NI) (); Church Leaders’ (Ireland) Group ()
80 Housing Rights ()
81 Community Advice Antrim and Newtownabbey ()
82 Department for Communities (2019)
Published: 9 September 2019