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Understanding the impacts of welfare reform on people and services

April 2014

1

Understanding the

Impact of Welfare Reforms Quarterly Report

Q4 2013/14

Cornwall Council


April 2014

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Contents

Executive Summary 3

Introduction 10

Shared Services 14 Housing 20

Partner Data 32


April 2014

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Executive Summary

Summary of the year – 2013/14 This year we have seen central government welfare reforms affect services and people in Cornwall. However, the impacts in this first year have not been as severe as anticipated, and a proactive approach to prevention appears to have made a

difference.

The challenge now in this second year is to understand whether the early impacts are getting worse or settling down, and how sustainable households coping mechanisms are. If people are opting to borrow money and access short term

discretionary funding rather than seek long term solutions such as downsizing property size or increasing incomes, this will not be sustainable and the Council and

partners are likely to see ongoing and possibly increasing impacts on their services.

The Welfare Reform Act 2012 The Welfare Reform Act introduces a wide range of reforms with the aim of making

the benefit and tax credits system simpler by:

Creating incentives to get more people into work by ensuring that work

always pays. Merging out of work benefits and tax credits to create a single universal credit

(UC). It is anticipated that UC will be rolled out in Cornwall from 2016 at the earliest. However, this has not been confirmed.

Reforms to other benefits aimed at reducing the cost of the benefits system.

The changes that have been implemented so far are:

Under occupation - People in the social rented sector who are said to be under-occupying will either need to move or face a reduction in housing benefit.

Benefit cap - A benefit cap for out of work households restricts the amount of

benefit a household can receive to broadly the average earned income of a working household.

Crisis and care award - Elements of the discretionary social fund have been replaced by local welfare assistance. This has been established in Cornwall and is

now called the Crisis and Care award scheme. The government has announced that it plans to cut the funding for this fund.

Council tax benefit - As part of the government changes to national benefits responsibility for council tax benefit has been passed to local councils to create a

Localised Council Tax Support (CTS) scheme. The government no longer covers the full cost and has reduced the amount of funding available to Cornwall Council for

benefit support by 12.5%. Cornwall's new scheme means all working age recipients of Council tax support now pay a minimum 25% contribution towards their council tax. At the same time, Council agreed to an exceptional relief and transitional

support fund of £1.1million to support people who are not able to pay. This fund was initially agreed for 1 year but has now been rolled over to 2014/15.

http://www.cornwall.gov.uk/default.aspx?page=33728


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Personal Independence Payments (PIP) - with a 20% budget cut will replace Disability Living Allowance (DLA) from April 2013. It is intended that it will be delivered through a focus on the most disabled. While councils will not have a role in

the delivery of PIP, there will be people, who formerly qualified for DLA, who will no longer be eligible for support with a consequential risk of an increased demand on

councils' assessment and support services.

Key messages

1. The number of new payers of Council tax in arrears has increased

There were more than 20,000 new payers in April 2013. 30% (5989) of new payers

are in arrears at the end of Q4. This is an increase on the last quarter.

Of the 6000 new payers in arrears, 80% (4,800) have received a court summons.

2. The Council tax collection rate for 2013/14 was 97.13%

This is slightly below the target of 97.7%.

3. Council tax related processes have increased by 27% this year

28%

31%

26%

30%

Q1 Q2 Q3 Q4

0

5000

10000

15000

20000

25000

30000

35000

Q1 Q2 Q3 Q4

2012/13

2013/14


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4. Numbers of calls to the Council tax contact centre were higher overall

this year

5. 6,747 awards were made through discretionary funds in 2013/14 but

there has been some under spend

There has been some underspend against all three funds. The under spend for Discretionary Housing Payments (DHP) was £230,000, Exceptional Relief/ Transitional Support (ER/TS) was £930,000 and CCA was £340,000). ER/TS funding

has been rolled over to 2014/15 and CCA is retained by the Council but DHP under spend will be returned to government.

A proactive approach to discretionary funding is being implemented in partnership with Cornwall Works, Together for Families and others. This will encourage

customers to engage with services to prevent the “revolving door” effect and repeated approaches to the Council for short term financial help without resolving

the causes of the problems. This is especially important given that the future of Crisis and Care awards is

uncertain and the amount the Council will receive in future DHP is undecided. Reductions to these funds could cause increases in rent and Council tax arrears in

the future.

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

Q1 Q2 Q3 Q4

2012/13

2013/14

73%

15%

66%

27%

85%

34%

DHP ER/TS CCA

Percentage ofunderspend

Percentage ofspend


April 2014

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6. The number of Cornwall Housing tenants affected by under occupancy

charges and in arrears has stayed well below modelled outcomes this quarter

Although in Q4 it appears that there has been a reduction in the proportion of this

group in arrears to 53% (476), this may be artificially low and needs to be treated with caution this quarter due to loophole cases and year end measurement issues.

It may also be relatively low due to the provision of proactive arrears prevention. However, the question of how sustainable this is has been raised since tenants may

be borrowing money to pay their rent or have relied on short term discretionary funds.

Overall arrears at Cornwall Housing have reduced from £913,000 (Q1) to £849,000 (Q4). 26% of all tenancies are in arrears which is significantly lower than those

affected by under occupancy charges.

No cases based solely on the under occupancy reduction are currently being progressed to court action stage but there is one case expected to be escalated to court stage shortly which will be an interesting test case for Cornwall Housing.

Cornwall Housing data only

7. The number of households approaching Cornwall Housing’s, Housing Options Service has risen by 35% in the last quarter

In Q4 2656 households approached the Housing Options Service for housing advice compared to 2012 in Q3. The largest percentage increases between Q3 and Q4 have

been enquiries relating to Local Authority/ Registered Social Landlord rent arrears (81% increase), debt and finance (64% increase) and friends and family no longer

able to provide accommodation (43% increase). 8. Increases in shoplifting linked to benefit dependency

The evidence this quarter strengthens the message that increases in shoplifting are

linked to levels of benefit dependency, and as such are likely to be as a result of Welfare Reform.

Increases in shoplifting are predominantly in areas where there are the highest levels of benefit dependency; namely within the towns of Camborne/Pool, Bodmin,

Newquay, St. Austell and Penzance – and significant increases were also noted in Liskeard and Looe.

59%

74% 70%

53%

Q1 Q2 Q3 Q4


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Proactive work by community safety partners with food banks and retailers in the areas affected may be starting to have a positive impact, which will be explored next quarter.

Reports of domestic abuse have also increased but there is no correlation between

the patterns of change and levels of benefit dependency, indicating that the main driver is unlikely to be Welfare Reform (although it may play a part).

Amethyst Community Safety Intelligence Team

9. Winter wellbeing

Despite cuts to funding this winter (£700,000 to £50,000) the winter wellness partnership have had 900 referrals to the free phone advice number and provided emergency fund support to 156 households.

Partnership working with the Council services means more people are connected

with the discretionary funds that they may be eligible for.


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1. Introduction

About this paper

In December 2012 Cornwall Council published research into the expected impact of

welfare reforms and made the recommendation that we should continue to monitor the impact as these changes are rolled out. The reason for this is to make sure we can provide people with the support they need through the transition, and to ensure

our services are ready for any changes in demand.

Cornwall Council has a Welfare Reform Coordination Group which is responsible for monitoring the impact of welfare reforms. The group reports to CLT and to Cabinet

every quarter using a welfare reform “dashboard”. This quarterly report accompanies the dashboard to provide more context and

detail. This report, the dashboard and wider information about welfare reform are available on the web pages. www.cornwall.gov.uk/welfarereform

This paper introduces the key elements of welfare reform and explains what has happened so far at Cornwall Council. It then goes on to analyse the data for the following key areas:

Recent News Shared Services

Housing Community Safety

The information from these chapters is used to develop the dashboard which you can see at the end of this paper.

The Welfare Reform Act 2012

The Welfare Reform Act introduces a wide range of reforms with the aim of making

the benefit and tax credits system simpler by: Creating incentives to get more people into work by ensuring that work

always pays. Merging out of work benefits and tax credits to create a single universal credit

(UC).

Reforms to other benefits aimed at reducing the cost of the benefits system.

The main elements of the Act are: The introduction of UC together with a benefit cap to provide a single

streamlined benefit that includes housing benefit, which will be phased out.

A stronger approach to reducing fraud and error with tougher penalties for the most serious offences.

A new claimant commitment showing clearly what is expected of claimants while giving protection to those with the greatest needs.

Reforms to Disability Living Allowance (DLA), through the introduction of the

Personal Independence Payment (PIP). Replacing Community Care Grants and Crisis Loans with localised welfare

support, giving greater power to local authorities. Reforming Employment and Support Allowance (ESA) with the aim of making

the benefit fairer and to ensure that help goes to those with the greatest

need.

http://www.cornwall.gov.uk/welfarereform


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Provision to abolish council tax benefit, paving the way for the localised council tax support introduced in the Local Government Finance Act.

•The introduction UC will see housing benefit merged into this new single benefit which, in all but exceptional circumstances, will be paid monthly, one month in arrears, direct to claimants. It is the Government's wish that 80% of UC transactions take place online. It is not yet clear exactly what role councils will have in the administration of UC, though a series of face-to-face pilots are underway to help define a way forward.

•It is anticipated that UC will be rolled out in Cornwall from 2016 at the earliest. However, this has not been confirmed.

Universal credit (UC)

•The Act makes provision for the introduction of a benefit cap for out of work households, restricting the amount of benefit a household can receive to broadly the average earned income of a working household after tax and national insurance. It will only apply to workless households and will be set at £500 per week for couples, families and lone parent households and £350 per week for single person households. Until UC is introduced it will be enforced by councils through housing benefit.

Benefit cap

•Elements of the discretionary social fund (previously administered through Job Centre Plus) have been replaced by local welfare assistance. This has been established in Cornwall and is now called the crisis and care award scheme. The government has announced plans to cut the funding for this scheme.

Local welfare assistance


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What has happened in Cornwall so far?

As part of the government changes to national benefits they have passed responsibility for council tax benefit to local councils and Cornwall Council has

created its own Localised Council Tax Support (CTS) scheme. The government no longer covers the full cost and has reduced the amount of funding available to

Cornwall Council for benefit support by 12.5%. Because of this, Cornwall Council voted, on 29 January 2013, for a new council tax scheme for Cornwall which came

into operation in April 2013. Cornwall's new scheme means all working age recipients of Council tax support now pay a minimum 25% contribution towards their council tax.

At the same time, Council agreed to an exceptional relief and transitional support

fund of £1.1million to support people who are not able to pay. This was initially agreed for 1 year but the funding has been rolled over to 2014/15.

From 2 April 2013 crisis loans and community care grants (which were previously claimed from the Department for Work and Pensions) have been replaced by new

Cornwall Council Crisis and Care Awards. The government has announced plans to cut the funding for this fund.

•Personal Independence Payments (PIP) with a 20% budget cut replaced Disability Living Allowance (DLA) from April 2013. It is intended that it will be delivered through a focus on the most disabled. While councils will not have a role in the delivery of PIP, there will be people, who formerly qualified for DLA, who will no longer be eligible for support with a consequential risk of an increased demand on councils' assessment and support services. In addition to this, anyone who finds themselves ineligible for PIP may also then be liable for the benefit cap due to losing their disability benefits exemption.

Personal Independence

Payments (PIP)

•With the aim of containing growing housing benefit expenditure; encouraging greater mobility in the social rented sector; and making better use of available social housing, the Act applies the size eligibility criteria applying in the private rented sector to social housing. This means that anyone deemed to be under-occupying will either need to move or face a reduction in housing benefit. The reduction will be 14% of their gross weekly rent charge for one extra bedroom and 25% for two or more extra bedrooms.

Under-occupancy of social housing

http://www.cornwall.gov.uk/default.aspx?page=33728


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In the news

The local context

The impacts of under occupancy loop hole

In January 2014, the DWP acknowledged a loop hole in the legislation regarding the spare room subsidy, meaning those who are of a working age and have occupied the same property continuously since 1996 should have been exempt from the new

charges.

In Cornwall there were 185 cases affected for the period 1 April 2013 to 2 March 2014. The total weekly amount underpaid throughout this period was £2700 totalling £111,000 to be refunded by central Government. On average the weekly

shortfall per claim was £14.70. The loop hole was closed and from 3rd March these households reverted to once again being effected by the underoccupancy charges.

Member involvement Cornwall Council Members agreed to write a letter to the Government requesting

that those affected by under occupancy charges but who were unable to downsize, had their property adapted for their disability or needed a spare room for medical

reasons, should be exempt. This falls in line with recommendations made by the Work and Pensions Committee.

New discretionary policies Exceptional Relief/ Transitional Support has been re-launched from 1st April 2014.

It is now possible to receive 100% assistance if council tax cannot be paid. A press statement has been released and partners contacted with details on all discretionary

funds administered by Shared Services. A significant new part is the conditionality element of the policies which will see Shared Services assist claimants in the long term with changing their personal and financial circumstances.

Universal Credit (UC) timetable for Cornwall

The current timetable states UC will be implemented in Cornwall from 2016 at the earliest.

Report: Universal Credit implementation: monitoring DWP's performance in 2012-13

The national context

Welfare Benefit Cap

MPs have backed plans to introduce an overall cap on the amount the UK spends on welfare each year. Welfare spending, excluding state pension and some

unemployment benefits, will be capped next year at £119.5bn. The idea, with Labour supporting it, was put forward by Chancellor George Osborne and would see

future limits set at the beginning of each Parliament. Universal Credit Implementation

A Work and Pensions Committee report (April 2014) has identified that “there have been significant problems with developing the IT systems necessary to operate UC,

leading to delays in its implementation” and has urged DWP to be “clear and frank” about the implications of the delays and to clarify plans to support vulnerable people.

http://www.publications.parliament.uk/pa/cm201314/cmselect/cmworpen/1209/120902.htm



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Research commissioned by DWP shows equipping benefit claimants with the digital and financial skills to use the Universal Credit system is likely to be costly. It finds around 1 in 10 users are likely to need intensive or ongoing support costing

approximately £6m over a two year period.

Under occupancy charges A Work and Pensions Committee report (March 2014) states reforms to the support provided for housing costs, including the under occupancy charges and the

household benefit cap, are causing financial hardship to vulnerable people who were not the intended targets and are unlikely to be able to change their circumstances in

response. The report urges the Government to exempt all households that contain a person in receipt of higher level disability benefits (DLA or PIP) from the under occupancy charges. Call for Government to undertake an impact assessment

A number of Local authority council directors have backed the organisers of a petition who have called on the Government to carry out an impact assessment of

welfare reform. More than 100,000 people have signed the petition demanding a review of the effect of changes on the sick and disabled, their families and carers. This motion was also backed in Parliament.

Increase in Council Tax and rent arrears

The charity StepChange has reported a significant huge increase in the number of people seeking help for council tax arrears. There has been a 77% rise in the number of households needing help over the last year rising from 25,500 in 2012 to

45,561 in 2013.

Money Advice Trust has warned that rent arrears are the fastest growing debt problem in the country. Shelter has dealt with just under 9,000 calls to its helpline from people struggling to pay their rent or mortgage in 2013, up a third on 2012.

Oxfam report

According to a new report by Oxfam and the New Policy Institute 1.75 million households in Great Britain have seen their incomes cut in the last three years as a result of welfare reform.

The report finds that 300,000 households have seen a cut in housing benefit,

920,000 have seen a cut in council tax support and 480,000 have seen a cut in both. In the last year alone, 400,000 households have been pushed further into

poverty by cuts to housing benefit or council tax support - households affected by both of these cuts typically lose around £18 per week.

Key messages from Joseph Rowntree Foundation Reports

The impact on social landlords and tenants:

DWP is likely to save £330 million in the policy’s first year, £115 million below

its initial target and a figure which will decline in future years.

498,000 have been affected by the policy – lower than the 660,000 estimate by DWP. Half are in arrears in the first six months of the policy due to the

average £14 per week cut. Over 100,000 people are subject to the spare room subsidy cut despite

wanting to move, while 6% have moved to avoid paying.


http://policy-practice.oxfam.org.uk/publications/multiple-cuts-for-the-poorest-families-175-million-of-the-poorest-families-have-315868


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Three quarters of people have cut back on food bills and others have been referred to food banks. Tenants told the researchers anxiety and insecurity are on the increase and they increasingly reliant on emergency support,

rather than less. People are becoming more vulnerable to debt. Over half are borrowing cash

from family and friends to pay for essentials. Tenants have sold family possessions to help cover costs.

Tenants – with help from their landlords - are putting a renewed focus on

finding work, apprenticeships, training and skills in response to the changes. However those in jobs - which tended to be in low-paid service roles with

short hours - were worried about falling incomes and job security.

Joseph Rowntree Foundation Report: The impact of welfare reform on social

landlords and tenants

The impact on families receiving Council Tax Support in England:

Almost half a million (490,000) low income families who before April 2013 paid no council tax will now be paying more than £200 a year. From this week, 70,000 poor households are paying council tax for the first time, facing

average bills of £114. Of the 2.3 million affected families, 1.5 million are below the income poverty

line and 1.8 million are workless and whose sole income is from means-tested benefits.

244 out of 326 councils have introduced minimum payments – up from 229 last year - for poor families regardless of their income. 45 have retained previous levels of support, 13 fewer than last year.

There is significant variation in the level of the minimum payment increases - 69 councils require 8.5% or less, while 47 have charges of 20% or more.

The end of the transitional grant to protect against larger increases is behind the rise in local authorities introducing minimum charges or increasing the charges from last year. Arrears have increased where minimum charges have

been introduced - while the collection rate of council tax fell.

Joseph Rowntree Foundation Report: How have low-income families been affected by changes to council tax support?

The research

Food banks A report commissioned by ministers at Defra concluded that people are going to

food banks because they’re genuinely in need. It contradicts welfare reform minister Lord Freud’s assertion that food bank usage is driven by supply (if you provide food banks, people will come for the free food). The report makes clear that people go to

food banks for both reasons of short-term crisis and of long-term poverty. There has been a 170% rise in the number of people issued vouchers for food banks

in the last 12 months. Trussell Trust food banks have seen the biggest rise in numbers giving emergency food since the charity began in 2000. Of those helped in 2012-13, 37% were children. The majority of people turning to food banks were

working age families. 30% of people referred to Trussell Trust food banks were referred due to benefit delay.

http://www.jrf.org.uk/publications/impact-welfare-reform-social-landlords-and-tenants

http://www.jrf.org.uk/publications/impact-welfare-reform-social-landlords-and-tenants

http://www.jrf.org.uk/publications/low-income-families-changes-council-tax

http://www.jrf.org.uk/publications/low-income-families-changes-council-tax

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/283072/household-food-security-uk-executive-summary-140219.pdf


April 2014

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www.trusselltrust.org

Food poverty A Organisation for Economic Cooperation and Development report shows a

reduction in people in the UK going hungry over the last 5 years. 8.1% reported they couldn’t afford food in 2012, decreasing from 9.8% in 2007.

Housing repossession According to figures from the Ministry of Justice, 37,700 private and public sector

tenants had their homes repossessed by court bailiffs in 2013, the highest number since records began in the year 2000.

http://www.trusselltrust.org/


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2. Shared Services

Analysis completed by Ian Stephens (Shared Services)

Key messages

The number of new payers of Council tax in arrears has increased this

quarter

Council tax contact increased by 28% via the post and x% over the phone

97.13% of Council tax owing for 2013/14 was collected within year

6,747 awards made through discretionary policies

Average numbers of days to process benefit claims is 12 days

The number of new payers of council tax in arrears has increased this quarter

There were more than 20,000 new payers in April 2013. 30% (5989) of new payers are in arrears. Although the number of new council tax payers in arrears has

increased from Q3, the additional ER/TS available in 2014/15 should enable customers to reduce or clear any outstanding balances for 2013/14.

Q1 Q2 Q3 Q4

28%

31%

26%

30%

97.13% of Council tax owing for 2013/14 was collected within year

£259,587,288 of Council Tax due in respect of 2013/14 was collected by 31 March 2014 an increase of £16m on 2012/13 (£243,611,802). This leaves an outstanding balance of £7,677,418 which the service will continue to work closely with

customers to achieve the highest possible collection rate

Council tax contact increased by 28% via the post and x% over the phone

During 2013/14 the Income back office team received an additional 24,257

processes to complete – 112,000 items from 88,000 items.

6,747 awards through discretionary policies

Whilst none of the discretionary budgets were spent in full this year, Shared

Services with the assistance of its partners both internal and external, have managed to assist with 6,747 separate awards. 11,538 claims were made therefore

there was a success rate of 58%, with a total spend of £1,452,750 being given to help those remain in their tenancies, move to more suitable accommodation, pay their council tax or receive white goods and cash for fuel and food.


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DHP ER/TS CCA Overall

4029 applications

2309 awards £637,185 spend 57% success

rate

3345 applications


rate

4164 applications


rate

11,538 applications

6747 awards £1,452,750 spend

58% success rate

(spar.net)

Average numbers of days to process benefit claims is 12 days

Whilst there has been an increase in the number of contacts to the Council with

regards the welfare changes the processing of new claims and change of circumstances has reduced from 2012/13 from 20 days to 12 days. Whilst claimants may not be receiving as much housing benefit or council tax support as they did

originally at the very least they are receiving decisions very quickly and can therefore make budgeting decisions of their own. This has also resulted in

overpayments created being reduced which again helps the claimant budget accordingly and does not put further financial pressures on them and also reduced the resources the Council needs to collect those debts.

Q1 Q2 Q3 Q4

17 days

13 days

13 days

7 days

(NI181, Single Housing Benefit Extract returns to DWP)


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3. Housing Analysis completed by Sara Nott and Mark Vinson (Cornwall

Housing)

Key messages

The percentage and number of Cornwall Council and Cornwall Housing

Tenants affected by the under occupancy reduction in arrears at quarter 4 has seen a drop

The total current rent arrears owed by the above under occupying tenants has levelled out

The percentage of tenants affected by the under occupancy reduction and in rent arrears is generally higher than the percentage of tenants

in arrears across all Cornwall Council and Cornwall Housing tenancies

The total current rent arrears owed by tenants has seen a slight decrease this quarter

The number of Cornwall Housing tenants affected by under occupancy

charges and in arrears has stayed well below modelled outcomes this quarter

The number of Cornwall Homechoice applications due to welfare reform

remains low

The number of households approaching Cornwall Housing’s Housing Options Service has risen by 35% in the last quarter

The causes of homelessness for those owed a homelessness duty by

Cornwall Housing have remained the same in 2013/14 The percentage and number of Cornwall Council and Cornwall Housing Tenants affected by the under occupancy reduction in arrears at quarter 4 has seen a drop

Quarter 4 has seen a further drop in the number of households affected by the

under occupancy reduction and a reduction in the number of those households currently in an arrears situation.

However this figure is provided with the caveat that it may be artificially lower than it should be due to the fact that the last financial year was 53 weeks long not 52.

The end of Q4 reports take place at the end of March not the 6th April when the financial year ends. On checking a small amount of accounts that showed clear in week 52, it was found that these same accounts were in arrears in week 53.

Therefore we could potentially expect a higher level of households in arrears next Quarter.

In addition to this, 66 households in Cornwall Council properties were positively

affected by the ‘under occupancy ‘loophole’, and had back dated refunds of Housing


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benefits credited to their rent accounts. These accounts will have now had the charge reinstated with effect from the 3rd March 2014.

Quarterly comparative % of and totals of under occupying tenancies in arrears.

Q1 Q2 Q3 Q4

59% : 562

74% : 677

70% : 630 53% : 476

The total current rent arrears owed by the above under occupying tenants

has levelled out

Whilst the arrears initially saw a steady increase over the first three quarters following the introduction of the under occupancy reduction, there was the expected ‘spike’ at Christmas, but since that time the arrears have again levelled out. Any

conclusions should however also consider that the initial number of affected tenancies has dropped from 992 to 892 over the last 12 months; and in addition to

this different tenancies have moved in and out of the effects of the reduction. So the tenancies originally affected in April 2013 may not necessarily still solely be the same tenancies affected at the end of March 2014. Consequently those tenancies

will bring their arrears levels in and out of the quarterly arrears figures at any given time.

However on a very positive note the level of arrears remains well below the initial financial modelled outcomes, which have been revised downwards on a number of

occasions. This is both due to the welfare advisor support and advice and other mitigating steps such as a revised rent management policy, changes to the bedroom

criteria within Cornwall Homechoice and the adoption of direct lets for those most impacted by the changes.

Cornwall Housing does however remain alert to the future risks potentially posed by the introduction of Universal Credit and is working closely with Shared Services and

the DWP to continue to look at mitigation outcomes through the formulation of the Local Support Services Framework.

Quarterly comparative levels of under occupying tenants’ rent arrears

Q1 Q2 Q3 Q4

£130,211

£141,760

£152,876

£138,645

The percentage of tenants affected by the under occupancy reduction and

in rent arrears is generally higher than the percentage of tenants in arrears across all Cornwall Council and Cornwall Housing tenancies

The following quarterly comparisons show that the percentage of tenants affected by the under occupancy reduction and in rent arrears, (shown in key messages 1.)

is generally higher than the percentage of tenants in arrears across all Cornwall Council and Cornwall Housing’s tenancies. This potentially indicates that the

financial impact of welfare reform changes on these households considerably outweighs that of the other economic and social factors impacting other tenants at this time. The impacts of all welfare reform changes are explored in a recent report

by the Joseph Rowntree Foundation: ‘The impact of welfare reform on social landlords and tenants’ which high lights the effects on both tenants and landlords.


April 2014

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Quarterly comparative % of and totals of under occupying tenancies in arrears.

Q1 Q2 Q3 Q4

28% : 2914

27% : 2837 30% : 3108 26% : 2741

The total current rent arrears owed by tenants has seen a slight decrease this quarter

Despite the ongoing subdued economic climate, rent collection rates for Cornwall Council and Cornwall Housing’s tenancies remain extremely high. Initial increases

seen early on the last financial year were as a result of assimilation, reorganisation and staff recruitment needs. However the rent management team, assisted by the three welfare advisors are in place and working extremely effectively both to collect

rent but also to support tenants in an arrears situation. Very early arrears actions have been adopted and recent reviews of the rent management policy emphasise

the need for a whole company approach to tenancy sustainability including support where appropriate to identify and potentially overcome barriers to entering the employment market.

Quarterly comparative levels of all CC and CHL tenants’ rent arrears

Q1 Q2 Q3 Q4

£913,000

£889,000

£892,000

£849,000

The number of Cornwall Housing tenants affected by under occupancy charges and in arrears has stayed well below modelled outcomes this

quarter

Whilst Cornwall Housing has, in line with its Rent Management Policy, progressed a

number of arrears cases to Court in relation to tenancies impacted by Welfare Reform, those arrears have not been the sole reason for Court action. Over 200

tenants affected by welfare reform were already in arrears prior to the 1st April 2013, some seriously, and it was inevitable given the changes that some of those tenancies would be unsustainable. Whilst one case in arrears solely due to the under

occupancy reduction is now due to be shortly escalated to Court stage, this has not been without ongoing efforts to engage with and support that tenant, but without

success. This is very much in line with anecdotal feedback from other registered providers in

Cornwall, all of whom are taking a proactive stance in trying to mitigate the impacts of the benefit changes over the last 12 months.

Number of cases progressed to Court solely due to welfare reform impact rent arrears.

Q1 Q2 Q3 Q4

Nil

Nil

Nil

Nil

The number of Cornwall Homechoice applications due to welfare reform remains low

The number of applications currently registered on Cornwall Homechoice who have indicated they have done so due to welfare reform changes remains low. Social


April 2014

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housing tenants impacted by the under occupancy reduction are registering on Cornwall Homechoice, however the way their application is recorded will be in line with the reason they choose when applying. Transferring tenants can indicate one of

a number of reasons for applying which includes both downsizing and welfare reform. Additionally a number of tenants will want to downsize who are unaffected

by the under occupancy reduction and simply wish to move somewhere smaller. Due to the choices available, it is expected that the a number of tenants applying due to welfare reform will have indicated downsizing to be the reason for their

move, as opposed to welfare reform. Consequently there is the potential that the figures recorded are not necessarily a true reflection of demand due to welfare

reform changes. Additionally expectations are that as the longer term financial pressures of benefit

reductions impact then there will be increased numbers of tenants seeking to downsize.

Type Area Q1 Q2 Q3 Q4

General

East 8 8 12 15

Mid 10 10 15 12

West 7 7 14 14

Total 25 25 41 41

Transfer

East 17 17 23 32

Mid 31 31 43 46

West 14 14 21 23

Total 62 62 87 101

Homeless

East 0 0 0 0

Mid 0 0 0 0

West 0 0 0 1

Total 0 0 0 1

The causes of homelessness for those owed a homelessness duty by Cornwall Housing have remained the same in 2013/14

Preliminary data from Quarter 4 shows that the three main causes of homelessness of those that Cornwall Housing Ltd accept a main housing duty towards remains the

same (family & friend exclusions, relationship breakdown and loss of private rented accommodation). The proportion of households accepted as homeless due to the loss of an assured shorthold tenancy fallen to 30.5% (-2.5%) of acceptances and

parental/friend exclusions has remained at 31% of acceptance; those whose homelessness was caused by relationship breakdown has also remained static at

20%.

The P1Es also show that during Quarter 4 the Housing Options Service prevented or relieved homelessness for 369 households, of which 65 (17%) were enabled to remain in their home, which is the same proportion as quarter 3. Solutions to

households housing problems that allow them to remain in their homes included Sanctuary Scheme for those experiencing domestic violence, mediation, mortgage

interventions, tenancy saver payments and resolving housing benefit problems. In quarter 3 304 households (82% (+3%) were assisted into alternative accommodation. Of those assisted into alternative accommodation 59% were

enabled to move into the private rented sector (+1%) on Q3), the majority assisted via the Homelessness Prevention Fund. Other sources of accommodation secured for


April 2014

21

households included supported accommodation, social hosing via Homechoice and low cost home ownership/housing market solutions.

Causes of homelessness by %

Quarter 1 Quarter 2 Quarter 3 Quarter 4

Family & Friend exclusions

30 % (14) 18 % (8) 31 % (17) 30.5 % (21)

Termination of AST 41 % (19) 27 % (12) 33 % (18) 30.5 % (21)

Relationship Breakdown

11% (5) 29% (13) 20% (11) 20% (14)

The number of households approaching Cornwall Housing’s Housing Options Service has risen by 25% between Q3 and Q4

In quarter 4 of 2013/2014 2656 households approached the Housing Options Service for housing advice, bringing the total for the full year to 9385. This is an

increase of 243 (10%) over the corresponding quarter in 2012/2013 and 385 (4%) over 2012/2013.

The last quarter has seen overall enquiries to Homechoice increase by 25%. The highest % increases over the last quarter have been Local Authority / Registered

Social Landlord Arrears with an 81% increase and debt or finance issues with a 64% increase.

The table below shows that in 2013/2014 there has been a general increase in the proportion of households seeking advice for housing issues that are likely to be

caused by the impact of welfare reform. The low number of enquiries attributed to welfare reform may be in part due to the how enquiries are categorised. For

example it is straight forward to identify rent arrears as the issue but more complicated to establish if the rent arrears have been in part due to welfare reforms.

2013/2014 Housing Advice

Enquiry Type by Quarter

Q1 2013-14

% (Number)

Q2 2013-14

(Number)

Q3 2013-14

(Number)

Q4 2013-14

(Number)

% change

Q3 –Q4

PRS rent arrears 2 (56) 1.4 (42) 3.3 (70) 3.5 (75) +7%

LA/RSL rent

arrears

0.8 (22) 0.9 (24) 1.0 (21) 0.7 (38) +81%

Debt/Finance 6 (153) 4.7 (112) 6.7 (144) 8.9 (236) +64%

NTQ private sector

12.5 (366) 10.2 (293) 12.2 (258) 13.4 (348) +35%

Seeking Accommodation

31 (905) 40.4 (896) 43.8 (929) 44 (1177) +27%

Family friends unable to

accommodate

19 (514) 25.2 (559) 26.4 (559) 30 (799) +43%

Welfare Reform 2 (54) 0 (0) 0.1 (2) 0.0 (1) -50%

Total enquiries

2365 2219 2121 2654 +25%


April 2014

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Note: The total number of enquiries is not the sum of the totals for each category. This is

due to some enquiries being recorded against multiple enquiry types and other recording

issues.


April 2014

23

4. Community Safety

Analysis completed by Erika Sorensen (Amethyst Community Safety

Intelligence Team)

Key messages

The evidence this quarter strengthens the message that increases in Shoplifting are linked to levels of benefit dependency, and as such are likely to be as a

result of Welfare Reform.

Increases in Shoplifting are predominantly in areas where there are the highest

levels of benefit dependency, within the towns of Camborne/Pool, Bodmin, Newquay, St. Austell and Penzance – and significant increases were also noted in Liskeard and Looe;

Proactive work by community safety partners with food banks and retailers in

the areas affected may be starting to have a positive impact (this will be explored further next quarter);

Reports of domestic abuse have also increased but there is no correlation between the patterns of change and levels of benefit dependency, indicating

that the main driver is unlikely to be Welfare Reform (although it may play a part).

The evidence

This paper follows on from the original “Welfare Reform and Crime” paper produced in December 2013 and included within Cornwall Council’s quarterly report

“Understanding the Impacts of Welfare Reforms”.

Changes in levels of crime are being monitored at small area level1 and against the level of benefits claimants in that area (a measure of potential vulnerability

specifically to Welfare Reform). 18 areas have been identified at Quarter 3 as more vulnerable than average based on the most recently published information from the Department of Work and Pensions2.

The key messages from the analysis undertaken at Quarter 2 was that crime was

increasing at a faster rate in areas identified as potentially most vulnerable to Welfare Reform and there was some evidence to indicate a link between the patterns of change in Shoplifting offences and the level of benefits claimants.

Quarter 3: general observations

Over the first six months of the year all recorded crime increased by 5% with

the main types of crime contributing to this rise being Violence (particularly Domestic Abuse), Public Order Offences, Shoplifting and Other Thefts. Over the last quarter, we have seen these rising trends plateau and start to reduce,

particularly with respect to Violence (including Domestic Abuse);

1 Lower Super Output Area – this is a small statistical geography that contains an average of 1500 people. 2 Working Age Claimants at August 2013 by Lower Super Output Areas, DWP Information, Governance and Security Directorate. NB uses pre-2011 LSOA boundaries.

http://www.cornwall.gov.uk/media/5830693/Welfare-Reform-Q3-background-report-with-appendix.pdf


April 2014

24

Shoplifting is the only high volume crime type to buck this trend and continued to rise into 2014. Early indications for Quarter 4, however, suggest that this may finally have started to level out and this is attributed to proactive work

undertaken with food banks and retailers by police and local community safety partners (for example, in the Safer Towns).

The table below shows changes in crime between April and December 2013 compared with the same period the previous year. Note that Drug Trafficking is a

subcategory of Drugs and Shoplifting is a subcategory of Other Acquisitive Crime.

With the exception of criminal damage and public order offences, crime in the most vulnerable areas has increased more than in less vulnerable areas;

Examination of the patterns of change in these offences and the corresponding level of benefit dependency at small area level3 (see table at the end of this

document) show significant statistical relationships for Shoplifting and Drug Trafficking. In both cases the correlation coefficient (strength of the relationship) is higher than when this analysis was undertaken in Quarter 2.

Note, however, that this relationship does not prove causality; The increase in Drug Trafficking, is an indicator of increased levels of proactive

police targeting of drug supply in these areas; Reports of domestic abuse have also increased but there is no correlation

between the patterns of change and levels of benefit dependency, indicating

that the main driver is unlikely to be Welfare Reform (although it may play a part);

Increases in Shoplifting are predominantly in Camborne/Pool, Bodmin, Newquay, St. Austell and Penzance – and significant increases were also noted in Liskeard and Looe. These rises are either in the vulnerable LSOAs themselves

or in outlying areas of the same towns where there are large supermarkets/other stores. A full breakdown of crime trends in the most

vulnerable areas is shown at the end of this report; As reported last quarter, alcohol and food (particularly meat) continue to be the

most targeted items4 and the profile of items targeted is fairly similar in areas

of high benefit dependency to the profile for Cornwall as a whole (shown in the table of most targeted items below). The average value of items stolen per

theft, however, is lower in these more vulnerable areas (£59 compared with £77 for Cornwall as a whole);

3 Using Pearson’s correlation coefficient 4 Note that this data is was provided by the police specifically for this report and, as such, covers the period from 01 April 2013 to 31 March 2014

Less

vulnerable

areas

Crime typeApr-Dec

2013Change n Change % Change %

All crime 2,722 118 5% 0%

Criminal damage & public order 659 -26 -4% 3%

Drugs 205 54 36% 12%

Serious acquisitive crime 212 8 4% -18%

Other acquisitive crime 835 114 16% 2%

Violence 766 16 2% 10%

Domestic abuse 293 26 10% 4%

Drug trafficking 58 41 241% 30%

Shoplifting 288 84 41% 5%

Vulnerable areas


April 2014

25

Previously it has been cited anecdotally that we are seeing an increase in thefts of certain necessity items, such as toiletries and baby products. We are unable to confirm whether this is the case based on the data provided this quarter, but

it should be noted that the proportion of thefts relating to baby products accounts for only 1% of the total offences. Within the category of

cosmetics/toiletries, the most commonly stolen items are higher priced brands of moisturisers and make-up.

NB the top 4 types of item targeted make up over 80% of all thefts

Implications

The implications for Safer Cornwall partners and our communities remain unchanged from Quarter 2:

Shoplifting is a low impact crime (compared with violence, for example) but high in volume. The rise has contributed to an increase in all recorded crime

and our predicted failure to achieve crime reduction targets for 2013/14; A further rise in shoplifting puts additional pressures on police resources and

also on the business sector, particularly smaller businesses that may be less

resilient; There is an increasing demand for “black market” goods, including from people

who may not have considered buying illegally in the past. This means a strengthening of criminal activity and supply networks in already vulnerable communities. Anecdotal reports from the police suggest that offenders are

largely known to them already but the current climate is encouraging higher levels of activity.

What are we doing about it?

Crime is monitored, reported and discussed on a minimum quarterly basis to

identify emerging patterns and provide evidence for multi-agency problem solving and the development of responses by partners. These specific issues are discussed in detail by Safer Cornwall at both practitioner and strategic level.

Devon and Cornwall Police are working closely with food banks on local initiatives

and with retailers (particularly supermarkets) on target hardening. Of the 18 most vulnerable areas identified at Quarter 3, 16 are located in the towns identified for the Safer Towns programme. Multi-agency action plans for each town also include

specific initiatives with food banks, targeted operations (such as Operation Nutmeg in Camborne) and debt advice to vulnerable individuals and families.

Cornwall Vulnerable areas

Targeted item Crimes% of

shoplifting£ stolen Average Crimes

% of

shoplifting£ stolen Ave

Food 673 32% £20,577 £31 111 30% £3,296 £30

Alcohol 554 27% £17,184 £31 111 30% £2,309 £21

Cosmetics/toiletries 246 12% £30,357 £123 51 14% £6,011 £118

Clothing 214 10% £13,361 £62 39 10% £2,301 £59

Total 2,086 £160,340 £77 373 £22,173 £59

Meat 221 11% £9,090 £41 36 10% £1,196 £33

Baby products 23 1% £1,025 £45 3 1% £28 £9


April 2014

26

The national picture

The upwards trend in Shoplifting is mirrored in our neighbouring community safety partnerships across the Devon and Cornwall Peninsula. At present no additional

diagnostic work has been undertaken to confirm the link with Welfare Reform but the findings from Cornwall have been highlighted in the Peninsula Strategic

Assessment that supports the work of the Police and Crime Commissioner and the direction of the Police and Crime Plan.

This trend is also apparent in the average trend line for our most similar family of partnerships nationally. News stories linking the increase in shoplifting to Welfare

Reform continue to emerge from police forces and Police and Crime Commissioners across the country.

Looking to the future

The Welfare Reform changes are planned to be phased in over the next five years and hence the impacts on crime are only starting to unfold. The introduction of

Universal Credit, which will be phased in between 2014 and 2018, is a significant risk factor based on what we have observed so far.

Welfare Reform and crime is discussed in more detail in the Safer Cornwall Strategic Assessment, which can be viewed and downloaded here.

http://safercornwall.co.uk/crime-in-your-area/documents-and-publications/

Comparison of change at LSOA

(rate per 1000 population)All crime

Criminal

damage &

public order

Drugs

Serious

acquisitive

crime

Other

acquisitive

crime

ViolenceDomestic

abuse

Average change vulnerable areas 4.4 -1.0 2.0 0.2 4.4 0.6 1.0

Average change less vulnerable areas 0.1 0.3 0.2 -0.7 0.2 0.7 0.1

Significant increase (areas) 10 10 11 5 16 11 12

Of which vulnerable areas 1 1 3 1 3 3 3

Mean 0.3 0.3 0.3 -0.7 0.4 0.7 0.2

Standard deviation 10.0 4.1 2.2 2.6 5.2 4.1 2.5

Correlation with benefits 0.155 -0.036 0.194 0.075 0.210 0.057 0.047

Comparison of change at LSOA

(rate per 1000 population)

Drug

traffickingShoplifting

Average change vulnerable areas 1.5 3.2

Average change less vulnerable areas 0.1 0.2

Significant increase (areas) 13 9

Of which vulnerable areas 7 5

Mean 0.2 0.3

Standard deviation 1.1 3.6

Correlation with benefits 0.333 0.195

Changes in crime in vulnerable areas

Significant reduction q Reduction s Significant increase p Increase r No change w

LSOA code Area

% working

age on

benefits

All crime

Criminal

damage &

public order

Drugs

Serious

acquisitive

crime

Other

acquisitive

crime

ViolenceDomestic

abuse

E01018997 Penzance Treneere 38% r s r r r r r

E01019033 St Austell Gover Ward South East 37% r s s r p s q

E01018910 Redruth North Close Hill 35% r r w p r w r

E01018875 Camborne West Ward West Central 35% r r s r r s r

E01018870 Camborne South Pengegon 34% r s r s s r p

E01018898 Illogan Highway South 32% r s r s p r r

E01018930 Bodmin St Mary's Ward South East 30% s s s s w s q

E01019056 St Blazey West 29% s s s s r s q

E01018995 Penzance Central St Clare 29% r s r r r r r

E01018878 Camborne West Ward East Central 29% p p p s p p r

E01019020 Newquay Edgcumbe North Ward West 28% s w p s q p p

E01018841 Falmouth Penwerris Ward North 28% w s s r r s s

E01019029 Newquay Gannel Ward North East 27% s s q s r q q

E01019041 St Austell Mount Charles Ward North West 27% r r p r s p p

E01018933 Bodmin St Petroc Ward Central 27% s s q w r q r

E01018984 Hayle South and High Lanes 26% s r s s s s r

E01019047 St Austell Poltair Ward South West 26% s r s s s s r

E01018767 Liskeard North Ward Central 26% r s r s r r r

Produced by:

Cornwall Council Welfare Reform Coordination Group

Coordinated by:

Lorna Fish, Policy Specialist

8 May 2014

If you would like this information

in another format please contact:

Cornwall Council

County Hall

Treyew Road Truro TR1 3AY

Telephone: 0300 1234 100

Email: [email protected]

www.cornwall.gov.uk

mailto:[email protected]

http://www.cornwall.gov.uk/

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