Response to the Public Accounts Committee Report

The Public Accounts Committee undertook an inquiry to consider how the changes to Housing Benefit introduced by the UK Government’s welfare-reform programme are impacting on Welsh councils and housing associations. The back ground to the review is the Welfare Reform Act 2012, heralded as a significant change to the administration and distribution of benefits that will have a major impact on many citizens in Wales. That programme was embarked upon in April 2011, by the UK Government, culminating with the phased introduction of Universal Credit between October 2013 and 2017.

A major focus of the UK Government’s plans, are changes to Housing Benefit, that aims to reduce annual welfare expenditure by around £2.3 billion. These changes will mean that millions of households across Great Britain will receive less in benefits – creating hard choices for them about how they use and manage their available finances day-to-day.

The Public Accounts Committee receiving the auditor general’s report ‘Managing the Impact of Welfare Reform Changes On Social Housing Tenants in Wales’ first published in Jan 2015, undertook to establish a task and finish group and to further examine evidence of its impacts to date.

Public Accounts Committee chairman, Daren Millar AM publishing the report acknowledged that unusually, the committee was reporting on what was a largely non-devolved issue. The response also acknowledged that the political difference regarding the policy should not get in the way of delivering those changes efficiently stating. “Ultimately, when service delivery is disrupted by political disagreements or failure to collaborate or respond quickly enough, it is social tenants and the more vulnerable in society who suffer.”

After careful consideration the committee produced 17 recommendations. What is significant, is that the committee recommends a suite of options based on the outcome of cost benefit analysis it is asking the welsh Government to undertake ranging from full relief of the bedroom tax through to partial exemptions for disabled tenants in adapted properties.

In R2 the report suggests that government should consider a cost benefit analysis of mitigating the full impact of the removal of the spare room subsidy through Discretionary Housing Payment (DHP), as the Scottish Government chose to do (R2). This would be fully endorsed by bedroom tax campaign groups that have called for parity with Scotland who have agreed to bolster their DHP pot to provide relieve for their low income social tenants.

Significantly, the report also raised our concerns about the conversion of designated family accommodation into shared accommodation (R7), and asked the Welsh Government whether regulations are required to ensure that housing standards are acceptable. Currently, housing associations do not have to comply with houses of multiple occupation provisions (HMO) legislation that private landlords have too, such as, community consultation, planning consent for re-designation, room size standards, electrical safety and other measures.

Welsh Tenants also raised concerns regarding the tenant’s right to exchange, which can be frustrated or outright denied, because of social landlord’s policy regarding existing rent arrears. While we are informed that most social landlords are now moving to a ‘no restrictions policy’ – the committee recommends that tenants are able to exchange “to smaller properties if they have arrears which have arisen as a result of the removal of the spare room subsidy”.

We are naturally disappointed that the opportunities to downsize are not made universal for all tenants in rent arrears should they wish to exercise that option.

Restricting this process to bedroom tax arrears tenants alone, means that many other tenants in arrears, because of withdrawal of substantial amounts of Disability Living Allowance or other factors, would be denied similar opportunities. We would have wished that the opportunity to exercise their right to exchange would exist irrespective, with no restrictions. Although we recognise that availability of smaller suitable accommodation is a problem.

Recommendation 10 also asks the “Welsh Government to undertake an audit of social housing evictions and the outcomes for households, post-eviction”. Of course, eviction occurs when tenants are removed from their property. The recommendation we feel needed to go further and examine the number of tenants whose landlords have sought and gained possession, but have suspended removal subject to the meeting of certain conditions.

This process means that tenants have lost their security of tenure. Tenants who are in arrears have their feet held to the fire in these circumstances, as any hiccup in the repayment plan means they could be summarily evicted without recourse back to the courts unless initiated by them. Given the vagaries of the housing benefit system, this means they perpetually risk being evicted at any time if their finances are not consistently and regular – and as we know, the Department of Works Pensions (DWP) can suspend payment at any time.

The committee also expressed concern about the potential scenario that the most needy are ‘too poor for social housing’ and wanted the assurance that allocation polices do not inhibit the poorest from accessing a secure home (R11) because of their poverty or prior debt – and rightly so!

Among the other recommendations, the committee acknowledged that the advice and support services needs consistency of funding to enable the sector to provide longer term support services and that the balance between landlord and independent services actually reflects the needs and aspirations of people accessing support.

On examining the Discretionary Housing System (DHP) the committee found that cases presented in the high court have highlighted the unfairness of taking into consideration disability living allowance payments when applying for DHP. Here the courts found the process unfairly penalised people with disabilities as money received needed to be set aside for care and mobility and is not ‘disposable income’. The committee recommended that DHP processing needed to be more consistently applied across Wales (R14) with better monitoring and transparency (R15-16) of reporting of uptake, availability and feedback to applicants.

Finally, the committee urged the Welsh Government to take an early look at the likely impact of the changes to the welfare system, including the changes to eligibility of 18-21 year olds to access housing benefit, with significant restrictions if they are not in an ‘earn or learn’ programme and to consult widely about the potential impacts.

We have in this brief commentary, picked up on the ‘key’ recommendations of the Public Accounts Committee. On the latter point, we have seen some significant announcements in the Welfare Reform and Work bill, which will further challenge all whom work in the housing sector in Wales.

The restrictions under the ‘earn or learn’ scheme for example, will hit organisations who provide residential accommodation and support for young people hard, such as the Young Members Christian Association (YMCA) and others, who could have their work seriously undermined by these new provisions.

We earnestly hope that we are more pro-active in finding support solutions to enable people whom rent to sustain their tenancies, and that advice services (who are more needed than ever) have the security of being able to plan their support more ably in the future.

The Welsh Tenants have advocated widespread relief from the bedroom tax through re-designation of undersized bedrooms and of course were disappointed that this issue was not recommended, as a great number of properties do not meet size standards that we should expect of a modern democratic society – and that disabled tenants are immediately made exempt.

Introducing these measure does not mean that we cannot continue to pursue more efficient use of the existing stock through incentives to downsize and provide adequate compensation for those who are prepared to give up their home. There are, as we have said, many, many times thousands tenants who have high morale social standards and are prepared to give up their home for larger families, but rightly so, they need some assurances – that they are offered secure accommodation in return. Taking the risk of high cost and often poorer standard private rented sector accommodation as compensation is absurdly optimistic – little wonder there are more prepared to stay and tough it out with less income with all the consequences that brings – than face the prospect of no security with summary eviction, with little or no defence.


Steve Clarke is Managing director of Welsh Tenants

Contact: Tel 01685723977 mobile 07879815479

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