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Supporting Older
People Conference
SP4: Welfare reform – the challenge ahead
Speakers: Julie Vickers
Director of Business Support New Charter Housing Trust
Ken Youngman
Group Finance Director Family Mosaic Housing
Chair: Kevin Williamson
Head of Policy National Housing Federation
NHF FINANCE CONFERENCE
WELFARE REFORM
THE CHALLENGE AHEAD
19th March 2014
Julie Vickers – Director of Business Support
THE NEW CHARTER VIEW ON ….
• The Universal Credit “experience” …. to date
• Preparing for full scale implementation
• Mitigating the risk
NEW CHARTER – WHAT AND WHERE
New Charter HTG
• Stock Transfer (March 2000)
• 19,000 stock
• “More than just Housing”
• Metropolitan based
• Customers at the heart
UC PATHFINDER WHAT WE KNOW
• Began – 29th April 2013
• 11 months on 30 tenants receiving UC
• Significant arrears in some cases
• 13 switchback requests
• 5 Court orders
• 5 Arrears Direct Payments
UC PATHFINDER WHAT WE KNOW
BUT…numbers so low, hard to
assess the real impact
Rent Due £56,188
Arrears at date of claim £12,759
Arrears end of February £21,669
Increase in arrears £8,910
Collection Rate 84.14%
UC February 2014 (week 48)
UC PATHFINDER POTENTIAL IMPACT FOR NEW CHARTER
• Approx. 6,500 working age claimants • Based on 70% migration to direct payment, (4,550):
• Average Rent of £87.97 • Annual Debit £20m • Potential growth in arrears = £3.1m
• BUT • Ideally no arrears more than 8 weeks
ACHIEVING THE BUSINESS PLAN WHAT WE HAVE TO DO
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
2013/14 2018/19 2023/24 2028/29 2033/34 2038/39
Base
UC PATHFINDER - ISSUES ARISING
• Alternative Payment Arrangements
• Arrears Direct requests – separate process • Service Charges
• “Who is on UC”?!?!
• Individual payment dates
UC PATHFINDER - SAFEGUARDS
• Arrears triggers – immediate attention
• Alternative payment arrangements
• Local support services framework
UC PATHFINDER – WHAT TO THINK ABOUT
• Tenant direct payment…. OBVIOUSLY! • Monthly payment ……. transition & 53 week rent years
• Client commitment
• Loss of access to information
• Claiming on-line
• Developing reactive systems – ‘rent first’ approach
UC PATHFINDER – WHY DATA SHARING?
• Fraud prevention and reduces overpayment • Efficiencies for both landlords and DWP • Releases time in the courts
• Support for claimants to work towards independence in
money management • Deliver value for money
TENANTS HAVE TOLD US…
Response 2009 2012
Access to a bank account 93% 93%
Using bank account all the t ime 57% 51%
Using overdraft regularly 33% 33%
Have long term debt/loans 27% 31%
Use licensed doorstep lenders 20% 23%
Use loan sharks 4% 2%
Have no savings 68% 72%
Don't know what a Credit Union is 57% 82%
Don't know where to get advice 21% 34%
N o Home Contents Insurance 52% 55%
N ot enough money to manage 19% 27%
Have money worries 48% 59%
Access to the internet in the home 43% 48%
Budget well 88% 84%
OUR OWN WORK TELLS US… Money Care Service
Debt Advice
Year N o of Cases Average Debt
per case
£'000 £'000 £
2012-2013 343 £2,870 £1,261 £8,367
2011-2012 242 £2,301 £247 £9,509
2010-2011 208 £1,613 N /A £7,755
2009-2010 229 £1,985 N /A £8,668
2008-2009 51 £481 N /A £9,434
Debt Dealt
W ith
Debt Dealt
W ith
OUR OWN WORK TELLS US… Money Care Service
Welfare Benefit Advice
Year N o of Clients
£'000
2012-2013 332 £941
2011-2012 228 £576
2010-2011 270 £531
2009-2010 314 £525
2008-2009 288 £567
Total Gains
BEDROOM TAX IMPACT - THE FIRST 10 MONTHS
Stock Numbers 19,026
Bedroom Tax Cases 1,792
Weekly HB Reduction £30,174
Annual HB Reduction £1,504,896
Amount Due April to January £1,146,633
Amount Collected £1,055,307
Collection rate 92.04%
Arrears Cases March 2013 740
Arrears Cases January 2014 1,231
Increase in Arrears Cases ( No.) 491
Increase in Arrears Cases ( %) 66.35%
Bedroom T ax
Group Summary - April 2013 to January 2014
INVESTING TO MEET THE CHALLENGE
• We recognised that preparing tenants and staff would require investment
• £250k pa into the medium term
• Self financing if we achieve an increase of 0.26% in collection performance
BUT… its getting harder
• Court costs – potential increase to £240 per case
• ‘Real Life Reform’ – disposable income reduced to
£4.79 pw
ENGAGING STAFF
• A positive approach demands organisation wide thinking – this is not just “credit control”
SWAT – CONNECTING WITH TENANTS
THE CUSTOMER IMPACT – PAYMENT PREFERENCE
Facility T ransactions Amount
£'000
Card 8,118 £1,459
Direct Debit 60,990 £5,845
DW P Direct 4,170 £53
HB Ad-Hoc Payments 2,360 £208
Automated Card Facility 17,746 £2,614
Internet 5,288 £790
Manual 3,650 £503
Post Office 90,174 £6,215
Paypoint 70,708 £4,258
Rent Collector 7,398 £453
Standing Order 58,357 £4,656
Rent from W ages 313 £80
T otal 329,272 £27,134
2012/13
GROUP PAYMEN T FACILITY USAGE
WHAT WE’VE BEEN DOING (1)
• ‘Leaky pot’ – arrears recovery
• Increased staff resource
• Advance rents at sign up
• Review of pre-tenancy support
• Mobile working solutions
• ‘Expected payment’ facility
• Service charge scrutiny
WHAT WE’VE BEEN DOING (2)
• Allocations review
• Alternative financial products
• Budgeting programme – MiNT
• Paperless DD….almost there
• Simplified Rent Statements online
• Continued staff involvement
WHAT WE’VE BEEN DOING (3)
GREAT OPPORTUNITIES Helping people into work
• 50 apprentices
• 198 work placements
• 137 households - family support programme
• 100 residents in ‘time banking’ project
• 13 work clubs (426 people)
• 118 into paid employment
WORKING TOGETHER … WORKING WITH OTHERS
WHAT WE’RE NOW DOING
Assessment against DWP criteria for APA Consider how we bridge the service gap Digital Inclusion Strategy Household Budgeting Keeping the message going – 2017
WHAT WE WOULD LIKE TO DEVELOP WITH DWP
• Easy “electronic” access to request alternative payment arrangements
• Influence in relation to alternative payment arrangements
• Full engagement in the migration process
• Data sharing – essential
SUMMARY
• Low numbers – difficult to assess
• Arrears are increasing
• Costs will increase
• Full company engagement essential
• Data sharing is crucial
• People are individuals … individuals matter
For any further information please
contact:
0161 331 2020
24,000 Homes
London £220m Income
June 2012
To
December 2013
Southwark
500 Tenants
1,500 Southwark
Demonstration Project
- Transition
98% cumulative
Cash Collection
Started at 80/85%
Currently 101%
we can
Our Philosophy
• We were keen to do the pilot
• Direct financial relationship is normal
• Tenants are generally decent and manage themselves
50% on HB
Half on partial HB = 75% (ish) already pay direct
What's your %?
Know your customers better
Household composition
Vulnerabilities
Email address
Mobile phone number
Income Types of benefit
Payment method
we can
Staff Skills
Customer Focus
Negotiating Skills
Commerciality
Training
Text
Cheque
DD’s
Payment Cards
Phone
Pay on the go app
Online
we can
Costs
• Some more staff
• Welfare Benefits and Financial Advisors, other agencies
• Changed DD arrangement – reduced cost 43p to 12p
Technology
Expected
Payments
Focus on pace, low level
interventions
Texts – in advance as well as chasing
we can
Alternatives to Possession
Small Claims
Attachment of earnings
(if you know where they work)
we can
DWP
Data Sharing
- Change of circumstance
notification
- Rent claim verifications
we can
Credit Agencies
Rent paid = positive rating
Notifications
How good are your non HB Arrears
Check yourself
Transition to UC
New claims started
piecemeal
We are moving to
Direct from April 2014
+ 200 p.m.
Timetable to 2017 so 3 years
we can
Case Study 1
Background Female on full HB, DLA (disability living allowance) and Employment Support allowance. Low level arrears to start
Intervention Referred to our Tenancy Sustainment team, Housing deemed uninhabitable and signs of domestic abuse.
Outcome • Downsized
• Backdated discretionary housing payment
• Cleared arrears
• Classified as Tier 1
we can
Case Study 2
Background Male, not married, partial HB. Gave us wrong bank details for DD, confused by 28 day payment cycle then affected by 14% under occupancy
Intervention Followed our usual rent escalation policy but also advised re bedroom tax and applied for DHP.
Outcome Received DHP and cleared arrears now looking for a smaller property
we can
Case Study 3
Background Female, married and on benefits. History of court action and a suspended possession order.
Intervention Wouldn’t move to DD and didn’t trust the council, agreed to payment by telephone
Outcome Maintaining payments
Supporting Older
People Conference
SP4: Welfare reform – the challenge ahead
Speakers: Julie Vickers
Director of Business Support New Charter Housing Trust
Ken Youngman
Group Finance Director Family Mosaic Housing
Chair: Kevin Williamson
Head of Policy National Housing Federation