Landlords Forum 15th September 2011
LHA changes and Universal Credit
Mick Bullock
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Agenda
• Changes to LHA from April 2011
• Shared Accommodation rate for
under 35’s from January 2012
• Universal Credit
• Any questions?
www.walsall.gov.uk
2
April 2011 changes
Local Housing Allowance
• removal of £15 top up
• Removal of 5 bed rate
• Weekly cap on LHA rates
• LHA rates set at 30th percentile
• Transitional protection/direct payment
safeguard
www.walsall.gov.uk
3
More April 2011 changes
• Size criteria – additional room for non resident
carer.
• Start of the staged increase in non-dependant
deductions (affects all claimants with non
dependant deductions)
www.walsall.gov.uk
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Impact on Walsall customers (refer to handout 2)
• Removal of top up – 1355 customers
• 5 bed rate removal – 45 cases --biggest
individual impact -- £68.08
• LHA 30th percentile –reduction of between £5
- £68.08 per week – 4659 customers affected.
• Non dependant deductions – 2245 customers
www.walsall.gov.uk
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Impact on Walsall
• Decrease in Housing and Council tax Benefit
payments
• Possible impact on rent arrears, council tax
collection rates
• Increase in enquiries from customers and
landlords
• Increase in Discretionary Housing Payments
• Increased demand on housing support
(homelessness service)
www.walsall.gov.uk
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Communication with Customers
• All existing customers have been made aware
of the changes (letter sent in March)
• Further notification to be sent before change
impacts and when change takes affect
• Advice from staff for new and existing
customers
• Website updates
www.walsall.gov.uk
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Shared Accommodation Rate for
under 35’s
• Currently applies to single claimants
under 25
• From 1st January 2012 will apply to under
35’s
• New claims from 1st January 2012 will go
straight onto SAR
• Existing claims will have some protection
www.walsall.gov.uk
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Shared Accommodation Rate for
under 35’s
DWP reasons for change
• Projected £215m a year savings to be made
• Part of its policy of encouraging a return to work
• Those on benefit should not be better off than in
work.
• “Reasonable and fair …as many of their
contemporaries in work would be living in shared
accommodation ”
www.walsall.gov.uk
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Shared Accommodation Rate for
under 35’s
DWP estimates as at March 2011,
• 54,000 claimants under 25 and 93,000 aged 25 and over being
paid LHA at the SAR.
• This is within a total LHA caseload of just over one million
• 65,000 in UK will be affected by this measure with an average
UK loss in HB entitlement of £41/week/claim. (West Midlands
5,240 average loss £32)
• Level of losses vary greatly between regions and even within
Local Authorities (Black country £30 Birmingham £40)
www.walsall.gov.uk
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When does it take affect?
Claims made before April 2011
• Existing claimants who, on or after 1 January 2012 are in a TP period from
the April 2011 LHA changes will move to the SAR at the same time as their
TP ends;
Claims after 1 April 2011 but before 1 January 2012
• Existing claimants not receiving TP or who have lost it because of a change
of circumstances before January 2012 will move to the SAR on the
anniversary date of their claim;
Claims made before April 2008
• Existing pre pre-LHA cases will move to the SAR (previously known as the
single room rent) on the annual review of their case.
www.walsall.gov.uk
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Exemptions to the SAR
Regs add two new exemptions to the SAR rules
• Homeless people who have slept rough or who are at risk of sleeping
rough, and
• Ex Ex-offenders who could pose a risk of serious harm to the public
Exiting exemptions to SAR continue to apply
• LA and RSL tenants.
• Tenants in exempt accommodation (old reg 11 claims)
• Claimants on middle or highest rate care component of DLA
• Claimants who have a non non-dependant residing with them.
• Claimants entitled to an extra bedroom to allow for a non non-resident
carer to sleep over where overnight care is required.
• Claimants under the age of 22 who were formerly in care.
www.walsall.gov.uk
12
Preparing for the change
• Estimating the impact of the SAR change on existing claims
(level of loss, dates etc)
• Alerting other local services and plan for coordinated
approach
• Identifying and notifying those affected and the date they
will be affected
• Publicity including what help and support is available from the
LA
• Impact on provision of debt/hardship advice, housing advice,
homeless etc
• Impact on DHP budgets
www.walsall.gov.uk
13
Universal Credit
Welfare Reform Bill
• Due to become law later this year
• Introduces Universal Credit
• Universal Credit will replace housing benefit
www.walsall.gov.uk
14
Universal Credit
Why change?
•
•
•
•
Complex system
Too many different types of benefits
Welfare Benefit expenditure out of control
Culture of worklessness
www.walsall.gov.uk
15
Universal Credit
• One payment to replace most working age
benefits (including housing benefit)
• Simplification of benefit system
• Housing Benefit for claimants of Pension age
will be made with Pension credit payments
www.walsall.gov.uk
16
Key dates
2011 - Welfare reform bill
2012 - LHA single room rate to apply to under
35’s (currently under 25’s)
2013 – LHA rates set by Consumer price index
2013 - Council Tax Benefit replaced by local scheme
2013 - Universal credit introduced for new claims
(replacing housing benefit)
2013 – Size restriction for social landlords
By 2018 – universal credit replaces housing benefit,
www.walsall.gov.uk
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Any questions?
Mick Bullock
01922 - 652673
bullockm@walsall.gov.uk
mobile - 07983612596
www.walsall.gov.uk
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