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Financial Inclusion Workshop

Financial Inclusion Workshop. HMP & YOI Grampian Aberdeenshire Financial Inclusion Partnership February 2014. What is Financial Inclusion?.

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Financial Inclusion Workshop

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  1. Financial Inclusion Workshop HMP & YOI Grampian Aberdeenshire Financial Inclusion Partnership February 2014

  2. What is Financial Inclusion? • The financial products and services that people need include budgeting skills, bank and saving accounts, affordable credit products, simple insurance products, and free money advice. • Financial Inclusion is about ensuring that everyone has access to appropriate financial products & services so they can take part in to days society.

  3. Welfare Reform Kristi Kelly, Project Officer (Welfare Reform) Aberdeenshire Council February 2014

  4. What we are covering • Social Sector Size Criteria • Benefit Cap • Discretionary Housing Payments • Scottish Welfare Fund • Personal Independence Payment • Universal Credit

  5. Social Sector Size Criteria Introduced from 1st April 2013 for Council & Housing Association tenants receiving Housing Benefit Reduction in Housing Benefit for working age tenants Under occupying: 1 bedroom14% Under occupying: 2 or more bedrooms 25% Council & HA Tenants affected as at September 2013 Under occupying 1 bedroom 948 Under occupying 2 or more bedrooms128 Average shortfall is between £8.43 - £16.53 per week

  6. Social Sector Size CriteriaWho is allowed a bedroom? • 1 bedroom is allowed for: • every adult couple (married or unmarried) • any other adult aged 16 or over • any two children of the same sex aged under 16 • any two children aged under 10 • any other child • a carer (or team of carers) who do not live with you but provide overnight care • Changes were later made for disabled children, foster carers & Armed Forces personnel

  7. Benefit Cap Took effect in Aberdeenshire from 15th July 2013 Cap on the total out of work benefits that working age people can receive £350 per week (single person) £500 per week (couple or lone parent) If affected by the cap it will result in a reduction in their Housing Benefit or Universal Credit award

  8. Bereavement Allowance Carers Allowance Child Benefit Child Tax Credit Employment & Support Allowance Guardian’s Allowance Housing Benefit Incapacity Benefit Income Support Jobseekers Allowance Maternity Allowance Severe Disablement Allowance Widowed Parent’s or Widowed Mother’s Allowance / Widows Pension Benefit CapBenefits Included

  9. Benefit CapExemptions • The cap will not be applied if they are in receipt of: • Working Tax Credit • Disability Living Allowance • Personal Independence Payment • Attendance Allowance • Industrial Injuries Benefit (and equivalent payments as part of a war disablement pension or the Armed Forces Compensation Scheme) • Employment & Support Allowance (support component) • War Widow/Widower’s Pension

  10. Discretionary Housing Payments Cash limited pot of money – budget is £835,868 DHPs are designed to help with: a shortfall between Housing Benefit & rent charge Rent Deposit Removal Expenses DHPs cannot be used to help with rent arrears, though a backdate can be requested Must be in receipt of Housing Benefit or Universal Credit (housing element) to qualify for assistance

  11. Scottish Welfare Fund Replaced the Social Fund for Community Care Grants & Crisis Grants Moved from DWP to Scottish Government to Aberdeenshire Council from 1st April 2013 National criteria, but local decision makers Payments can be provided in cash, goods and vouchers Means tested scheme

  12. Scottish Welfare FundWhat is it for? • Community Care Grant • Enable or continue independent living, preventing the need for institutional care. • Crisis Grant • Provide a safety net in an emergency when there is an immediate threat to health or safety.

  13. Personal Independence Payment • Introduced in 10 June 2013 for new claims • Replaces Disability Living Allowance (DLA) for 16-64 year olds (no new claims) • Those currently in receipt of DLA will gradually be invited to apply for PIP • Children (up to age 16 yrs) will continue to claim DLA and adults 65+ will continue to claim Attendance Allowance

  14. Personal Independence PaymentChanges from DLA • New claims process: • Telephone • “How Your Disability Affects You” Form • Face-to-face medical assessment • 2 components – Daily Living & Mobility • Points based system with 2 payment rates – Standard (8 points) & Enhanced (12 points) • 3 month backwards & 9 month forwards qualifying periods

  15. Universal Credit • A single benefit designed to replace most means-tested benefits • Claimed by working age people • Paid to those in or out of work • Claimed & maintained on-line • Single household payment, monthly in arrears • Housing costs will be paid directly to the claimant

  16. Universal Credit Benefits Included • Income Support • Income Related Employment & Support Allowance • Income Based Jobseekers Allowance • Housing Benefit • Child Tax Credit • Working Tax Credit

  17. Contact Details Kristi Kelly, Project Officer (Welfare Reform) E-mail: kristi.kelly@aberdeenshire.gov.uk welfarereform@aberdeenshire.gov.uk Telephone: 01779 484234

  18. Presented by Tracy McDonald, Accredited Money AdviserSally Mair, In-Court Adviser CASE STUDY

  19. John is twenty nine years old and is currently on remand for a period of six months. Prior to his arrest John worked part-time and earned a low income wage. John has a tenancy with a local Social Housing landlord which began in October 2013. Prior to his arrest John accrued rent arrears. John’s Landlord sent a letter to John to advise him of their intention to take legal proceedings to recover the rent arrears and evict him from the property. John struggles to read and write and doesn’t fully understand the letter from his landlord. John also has a number of other debts including, Pay Day Loans, Council Tax, Utility Bills and Home Order Catalogues. The Pay Day Loan lenders were calling John a number of times a day before he was arrested and his electricity provider had sent him a notice of disconnection.

  20. ACTIONS • Benefits check • Negotiating with landlord • Preventing homelessness • Housing benefit rules for prisoners • Dealing with eviction court action • Dealing with debt • Signposting to other specialised support services • Assistance on release • Homelessness on release • Food parcels

  21. ADVICE CENTRE SERVICES

  22. All advice centres offer free, independent, impartial, non-judgemental and confidential advice on a wide range of issues in person, telephone and email.

  23. GENERAL ADVICE • Benefits – entitlement and applications • Housing • Employment • Consumer • Utilities • Relationships

  24. WELFARE RIGHTS • Home visits to physically and mentally disabled or elderly clients who are housebound • Assist completion of complex DWP forms • Assist with Welfare Benefits Appeals both in preparation of documents and attendance in Tribunals with clients

  25. DEBT ADVICE • Offers advice when dealing with debt • All advisers DAS accredited • Cover Central and Southern Aberdeenshire • Service includes • Identifying client options • Assisting clients achieve their desired outcome • Negotiating with landlords and creditors • Arranging appointments with third parties • Completion of bankruptcy and other forms

  26. IN-COURT ADVICE SERVICE • Providing advice and representation for people who: • Are at risk of eviction • Struggling to pay rent or behind on mortgage payments • Are threatened with court hearings about debt or housing • Have court papers about debt or eviction • Need information on sequestration or bankruptcy • Need help with a small claim

  27. GORDON RURAL ACTION HuntlyGordon Advice Bureau, Huntly Business Centre01466 793676 Inverurie39c Market Place, Inverurie01467 624421 EllonInverythan House, Ellon01358 724425 Web http://gordonruralaction.org.uk Email enquiries@gordonrural.org.uk

  28. Dave Sims General Manager North East Scotland Credit Union

  29. What is a Credit Union ? Credit Unions are non-profit making financial co-operatives, offering their members an easy and convenient place to save, and access to low cost loans when required.  They offer a valuable service to everyone - business people, families, employed or unemployed, young people or those who have retired.   They encourage their members to make regular contributions into savings accounts that create a central pool of funds.  Saving money on a regular basis helps protect against unexpected financial pressures . This pool of funds is used to provide loans back to the members at very favourable rates.  Maximum 12.68% APR For nescu. Maximum 26.8% APR other Credit Unions. Unlike other financial institutions owned by groups of stockholders whose interests include a necessary return on their investments and paid bonuses, Credit Unions are owned totally by their members as democratic co-operatives and the money stays within the local community.

  30. Over 1Million People in 2013 went to Payday lenders For Example:- Wonga and Quick Quid Charging up to and in excess of 5000%APR Doorstop Lenders For Example:- Provident and Shopacheck Charging up to and in excess of 272%APR

  31. In Black And White. Doorstep Lender @ 272% APR (Typical) Sum borrowed - £600 - 52 weeks Repayment - £21 per week Total repaid - £1,092. Total interest - £492.00 Payday Loan@ 365 % APR (Typical) Sum borrowed - £600 - based on a 52 week period Repayment - £24.12 per week Total repaid - £1,254 Total Interest - £654 NESCU@ 12.68% APR Sum borrowed - £600 - 52 weeks Repayment - £12.24 Total repaid - £637.44 Total interest - £37.44 WHY PAY MORE WHEN YOU CAN PAY LESS

  32. nescu Nescu has been operational for 10 years in the communities of the north East of Scotland. We operate to give options for savings and loans to each and every member of the community. We provide an alternative to those lending money with high interest rates i.e Payday and doorstop lenders. We currently have Circa 125 Volunteers that help run our collection points throughout the North East of Scotland. We work closely with Partners in the community to offer advise to those who need it. Smart, CFINE and Ahead just to mention a few

  33. Working Partnerships

  34. AHEAD Action Health Education/Employment Against Disadvantage

  35. CFINE CFINE, is a Social Enterprise, sells fruit/ veg/ other produce on a commercial/ competitive basis CFINEsupply fruit to companies including c80 from the oil sector (many in the Healthy Working Lives scheme), restaurants, sandwich bars etc,. All profits are invested in the health and community development work they do in disadvantaged, excluded and vulnerable communities. Presently c100 Community Food Outlets (CFO’s) located in the regeneration areas. prices as affordable as possible.

  36. CFINE CFINEin north Aberdeenshire own the Fruit Mart, Longside, in which 18 adults with learning difficulties are in supported employment; Sells commercially to a variety of customers; Supplies produce to food banks operating in Aberdeenshire which provide a vital service to people in food poverty, >8 tonnes of produce eg pasta, tins, fruit and veg etc and toiletries, nappies etc over the past year which, FYI, every ton of produce diverted from landfill saves 4 tonnes of carbon emissions.

  37. AHEAD partnership The Budgeting Adviser with AHEAD can help clarify the confusion surrounding the benefits system.  The Adviser can check you are receiving the correct benefits and support you to claim additional welfare benefits.  The Adviser can also help you to budget effectively through the preparation of a personal budget – and by providing money saving advices.  The Budgeting Adviser can also signpost people on for more in-depth advice and assistance around debt.

  38. AHEAD partnership Through involvement with AHEAD we hope people’s financial capability will improve in areas such as budgeting and money management.  We hope that their understanding of the benefits system will also improve.  Evidence suggests that there are strong links between debt, poor money management and financial worry.  We hope that through involving the Budgeting Adviser, a person’s personal stress will reduce and their confidence increase.

  39. The scale of Debt in the UK 8.8 million adults in the UK are over-indebted. 8.8 million represents 18% of adult UK population 4 million of these adults have struggled to pay bills for over 12 months Almost 50% responded that debt was preventing them buying basics Source: Money advice service (2013); “Indebted lives: the complexities of life in debt”

  40. The scale of Debt in the UK

  41. Living with debt 74% report they are unhappy 70% responded they feel anxious 58% report negative impact on family life Yet… Only 17% access help to deal with debt 21% don’t admit they are in debt

  42. Living with debt 62% of 8.8m adults may need to approach advice providers at some point 41% lack confidence to deal with debt 44% don’t know what debt solutions are open to them Shelter report 1 in 5 people have borrowed to cover housing costs 1 million people have taken a ‘Payday’ loan to cover housing costs 1 in 4 too ashamed to ask for help if can’t meet housing costs.

  43. Help is at hand If you have concerns about welfare benefits you receive, or think you should be receiving, or simply want to check your entitlement it is important you seek some free advice. Advice is on offer from a number of advice agencies across Aberdeenshire.  AHEAD Project can also help with advice around Welfare Benefits

  44. Money advice and debt counselling If you have concerns about debt, budgeting or are just struggling to make ends meet, an appointment with a Money adviser could help you to turn your financial situation around. Money Advisers offer free, impartial and confidential money advice. If you are being asked to pay for a financial service, then you should be very cautious. Promote access to basic banking products and Credit Union membership through Nescu.

  45. Contact Details • Annette Johnston • Tackling Poverty & Inequalities Coordinator • Arbuthnot House • Broad Street • Peterhead • AB42 1DA • Tel: 01779 483216 • annette.johnston@aberdeenshire.gov.uk

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