Agenda item

Welfare Reform - Financial update

To receive an update on the schemes that provide financial support to residents.


The Sub-committee considered a update report on the three schemes that provide financial support to our residents, that were implemented or revised in April 2013 onwards because of on-going welfare reform, as well as an update on Universal Credit.


Discretionary Housing Payment Fund


The Discretionary Housing Payment (DHP) fund, administered by Local Authorities on behalf of the Department for Work and Pensions (DWP) with the aim at being a temporary payment, which provides support, just at the right time, to people in financial difficulties who have a shortfall between their rent and Housing Benefit (or Universal Credit including the housing element).


For the end of year financial position for 2020/21 768 applicants had received a payment with less than 1% (£4,772) being returned to Department of Work and Pensions (DWP).


Funding for 2021/22 was being managed differently by DWP and only part of the grant had been received (£309,105), with any remaining grant being given in late September 2021 based on demand and caseload.


Local Council Tax Support Scheme  


The demand on the scheme had seen an increase from 17,172 at the end of March 2020 to 17, 543 at the end of March 2021 and the cost to the scheme was £15,394,568.


The overall caseload for 2021/22 was 17,441 (claimants’ being 9,996 working age and 7,445 pensionable age). The cost of the scheme had increased to £15,757,160.


Local Welfare Provision


There had been 2,803 applications for Local Welfare Support in comparison to the 2,075 ,368 in 19/20 and 1,607 in 18/19.    


All applications were offered a full screening, advice and information including signposting to partner organisations where appropriate. 


Spend for the period in respect of immediate practical support amounted to £12,722.  This was in addition to the annual grant to the Food Bank of £40,500.


There was still funding with North East First Credit Union that allows the Authority to refer people with poor credit history who would be seen as higher risk customers, the opportunity to access reasonably priced loans.


This was a one off funding; customers are charged interest which goes back into the fund to be used by other customers and online applications had been introduced.

Covid-19 update


Additional grants to support applicants caused through the impact of Covid-19 had allowed increased support to assess and process discretionary applications for support with Track and Trace Payments.


Universal Credit


Universal Credit (UC) replaced 5 state benefits, the number of people claiming Universal Credit was 19,401 compared to 10,758 in February 2020.


Additional Work Coaches and Employment Advisors were employed to provide support, with Job Centre Plus Offices remaining open for those that are unable to access support digitally/via telephony.


Housing Department Update


The impact of UC continues to be felt by the housing department and they now have 4,658 tenants on UC as at 20 June 2021. 3,333 (73.26%) of these are in arrears although it is worth noting that 66.7% of those on UC were already in arrears when they moved onto UC.  The average arrears for those on UC was £549.75 (this has reduced since last quarter despite the impact of Covid-19) compared to an average arrears of £515.61 for all tenants and £271.22 for those not on UC.  Other housing providers are also advising of significant arrears with tenants in receipt of UC.


Covid-19 had a large impact on housing tenants with 1,248 of tenants reporting that they had been adversely impacted.  This had contributed to the significant increase in the number of tenants claiming UC, with 756 tenants on UC stating they have been impacted by Covid-19.


Covid-19 had also impacted arrears levels and since 16 March 2020 arrears increased by £515,962.


A member requested if the level of the Hardship Grant would be the same for 2021/22 that had been received for 2020/21 and if this would be provided in a staged approach for 2021/22. In response the Head of Resources informed the approach for 2021/22 would be confirmed.


A member questioned if data was collected in relation to Domestic abuse/Family breakup resulting into homelessness due to the effect of being placed on Universal Credit. In response the Client Manager Revenues and Benefits stated that they would investigate if this data was collected.


Agreed that the Welfare Reform – Financial update be noted.

Supporting documents: