Agenda item

The Director of Finance submits a report that outlines the Council’s Discretionary Housing Payment (DHP), Council Tax Discretionary Relief (CTDR) and Community Support Grant (CSG) policies, and to present key amendments intended to further focus intervention funding towards the prevention of homelessness and managing short term financial crises. The Commission is requested to receive the report and comment as appropriate.

The Director of Finance submitted a report outlining the Council’s Discretionary Housing Payment (DHP), Council Tax Discretionary Relief (CTDR) and Community Support Grant (CSG) policies.  The report also presented key amendments intended to further focus intervention funding towards the prevention of homelessness and managing short term financial crises.

The Principal Policy Officer (Revenues and Customer Support) drew attention to the key priorities for the Council’s discretionary policies and explained that:

·           CSGs were non-cash crisis payments.  Instead, items such as white goods were provided to enable someone to stay in their home;

·           The introduction of a benefit cap had had a significant impact on city residents, with the reduction of the benefits cap to £20,000 per annum amounting to a cut of £3million in benefits received in Leicester.  The impact of which was one of the main factors that discretionary housing payments were used to alleviate;

·           Indications were that the budget for discretionary payments would reduce over the next three years by £150,000 per annum.  At the end of this time, it would have returned to its 2013 level;

·           The Council’s legal obligation to support the most vulnerable claimants, and particularly those with severe disabilities who were unable to change their circumstances, would continue to be fulfilled;

·           The Homelessness Reduction Act 2017 placed new obligations on the Council to ensure the continued availability of permanent accommodation.  Funding therefore would be committed to vulnerable people in accommodation who were in danger of becoming homeless.  Such funding would be provided for 12 months, to cover shortfalls in benefits.  These households also would be encouraged to work with relevant services;

·           Approximately 40% of DHP was spent on under-occupancy, more commonly referred to as the “bedroom tax”.  The majority of people under-occupying property in the city were working age single people, many of whom were in two or three bedroomed properties.  Approximately 2,200 people were under-occupying Council or housing association properties, (not all of which were in receipt of DHP), but approximately 4,000 people on the housing waiting list were classed as being overcrowded.  The policy required people under-occupying property to register on the Council’s housing register to exchange their properties for smaller one, but many did not register.  It therefore was not proposed to change the Council’s policy, but to enforce it as written.  However, under-occupied households who had not previously sought assistance would continue to receive a 13 week “grace period” before conditions were applied; and

·           A successful pilot project had been undertaken with the Citizens Advice LeicesterShire (CAL) to support people affected by the benefit cap.  These people had been provided with targeted short-term payments that tapered over time.  Recipients also were encouraged to work with the CAL to address their situation through improving their skills, (for example, in budgeting).  The project had been successful in assisting Benefit Income Cap households in to employment, which had resulted in these households moving out of the cap situation.

Members expressed concern that the Council’s policy on action to be taken in relation to under-occupying households had not been properly applied.  The Council did not support the “bedroom tax”, but not applying the policy appeared to have created additional problems, particularly in relation to not being able to reduce overcrowding for other tenants.

Concern also was expressed that starting to apply the policy regarding under-occupancy correctly now would not only have a significant impact on tenants who had been supported for some time, but also would create a lot of extra work for housing officers.  It was noted that this also had been a concern when this report had been considered by the Housing Scrutiny Commission at its meeting on 12 March 2018, (minute 77, “Discretionary Policy Review 2017/18” referred).

The Director of Finance advised the Commission that it was acknowledged that it had not been realised until this review was undertaken how different the aspirations for this policy were between Housing and Financial Services officers.  In previous years, the way the grant was operated had created pressure to ensure that the money was spent, but it no longer was possible to fund people in under-occupied properties indefinitely, so the policy would have to be enforced more strictly.

The Principal Policy Officer (Revenues and Customer Support) noted that very few households had been continuously supported since 2013, so enforcing the policy now was unlikely to have the feared impact on tenants.  Housing officers had confirmed that one-bedroom properties were available for single people to move in to, especially through the Home Swap scheme.

The Commission also expressed concern that enforcing the under-occupancy policy would impact on people who had lived in a property for a long time, particularly older people.  Members were assured that the policy included provision not requiring older people to move from under-occupied properties where it would not be appropriate to do so.

It was queried whether vulnerable people who needed sustained help would continue to receive this.  Officers noted that the CAL had worked successfully with the people referred to it under the pilot scheme.  People often got better outcomes through engaging with the CAL, as the CAL was able to recommend alternative ways forward.

Members queried what the welfare reform reserve referred to in the report covered.  In reply, the Director of Finance explained that it had been created using surplus funds originally provided for CSG when responsibility for crisis support transferred to the council from the Department for Work and Pensions in 2013. Grant funding was provided for 2 years, but then ceased in 2015. Anticipating this would happen, funds received had been managed carefully to ensure they would las as long as possible.  To avoid the type of fraud experienced in other parts of the country, the Council purchased goods to assist those in crisis, rather than provide a cash grant, and also used the funds for other relevant welfare reform work.  It was anticipated that, on the basis of drawing down approximately £500,000 per year, this reserve would last until about 2021/22.

It was suggested that consideration could be given to including reference in the Council Tax Discretionary Relief Policy 2018-2020 to the measures that could be taken by the Council to ensure that it was not financially exploited by recipients of Council Tax Discretionary Relief.

Members questioned why that policy was not more explicit about the vulnerable groups it aimed to protect.  For example, although it referred to ‘race’, no reference was made to people such as refugees or asylum seekers.  It also was suggested that the exceptional circumstances referred to in paragraph 1.4 of Appendix B to the Policy could be extended to include people experiencing a severely debilitating mental health episode.  In reply, it was explained that there were some legal limitations on assistance that could be provided for refugees and asylum seekers, but the points raised here could be considered.

AGREED:

1)    That the Director of Finance be asked to consider amending the Council Tax Discretionary Relief Policy 2018-2020 to:

a)     identify the measures to be taken by the Council to ensure that the Council is not financially exploited by recipients of Council Tax Discretionary Relief;

b)     consider whether the vulnerable groups identified in the Policy can legally be extended to include refugees and asylum seekers; and

c)     consider whether the exceptional circumstances outlined in paragraph 1.4 of Appendix B to the Policy can be extended to include people experiencing a severely debilitating mental health episode;

2)    That, subject to 1) above, the amendments to the Council’s Discretionary Housing Payment Policy, Council Tax Discretionary Relief Policy and Community Support Grant Policy be supported; and

3)    That the Director of Finance be asked to provide the Commission with a review of the implementation of the policies listed in 2) above in 12 months’ time.