Welfare Reform Changes

1. Welfare Reform Changes The effect on organisations

2. The New Landscape • Era of austerity measures • Reduced tenant income = threat to revenue stream • Effect on sustainable housing options, social exclusion • Demand & Supply issues • Greater need for support & engagement

3. Housing Demand • Increase across the board • Demand from private rental sector for social housing (cuts in LHA, generally lower incomes making rents unaffordable) • Increased homelessness levels • Demand from non-dependants seeking own property to avoid deduction

4. Housing Demand (cont) • “Downsizing” demand due to HB restrictions on under-occupiers • Demand for move-on – can supported accommodation be affordable if tenants have to subsidise cost?

5. Housing Supply • To decrease? • Threats to revenue could result in less development of new builds • Fewer housing options/products – LHA restrictions can affect intermediate rent, HA leasing schemes

6. Housing Supply (cont) • Issue around the number and location of appropriate properties for tenants seeking to downsize • Private rented sector failing to address supply issues as too costly

7. Threats to Revenue • Increased Arrears • Reduced income for tenants (DLA cuts, break in benefits) making rent payments more difficult • HB reforms. Direct impact of reduction for long term unemployed, under occupying tenants, increased non-dep deduction

8. Threats to Revenue (cont) • Charges & Liabilities • HB restricting rent – increase pressure to justify higher rents and service charges, linking to lower LHA rates? • Liability for HB overpayments resulting from tenants benefit or household circumstances changing

9. Increased Costs • The cost of failed tenancies (court fees, void costs) • The resource cost of staff chasing increased arrears or recruitment costs of employing additional support • Non-financial costs – a negative effect on the landlord-tenant relationship as dialogues shifts to just rent collection?

10. An era approaching of increased costs combined with multiple threats to revenue– How can organisations ready themselves for this?

11. Organisational Requirements • The Information Requirement • Importance of management information • Which tenants will be affected? Can they be identified? Will future tenants be risk-assessed against the effects of reform? • Need to quantify the effects in monetary terms, “what is our exposure as a business?” • Communication of information from HB departments – are these links in place?

12. Organisational Requirements (cont) • The Advice Requirement • Increased need for welfare benefit, debt, income maximisation advice • Do links exist with advice providers? Is this service provided in-house? • Need for front-line staff to be trained – advice giving now a part of every role?

13. Organisational Requirements (cont) • Communication & Innovation requirement • Are changes being communicated to tenants in the right way? • Are we being innovative in helping tenants back to work? Opportunities through community investment, targeted recruitment & training, social enterprise to mitigate effects on unemployed tenants

14. Organisational Requirements (cont) • The Procedural requirement • Need for procedures to reflect the reforms • Transfer procedures – priority for those under-occupying? • Arrears procedure – a move towards more support, rather than enforcement against those who simply cannot pay?

15. Next Steps • Importance of sector-led responses to future consultations – a chance to shape the details of reform? • Early planning – getting the information on effects NOW and the plans in place to response to them