What Makes a Good Local Welfare Support and Conditionality Scheme?

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womanladdergraph_800x600The Welfare Reform Club and Policy in Practice have been working with a number of local authorities since 2012, as elements of the welfare system have been localised.

One of the more interesting trends we have noticed is the introduction of local ‘conditionality’.

Conditionality refers to requirements placed on residents in exchange for financial assistance.

So far, it has usually been applied at national level, by Jobcentre Plus. An example would be the requirement to look for work in exchange for Jobseeker’s Allowance, “The Claimant Commitment”.

The introduction of conditionality by local authorities may have largely gone unnoticed, but it is an important side-effect of localisation.

In this blog post we highlight why local conditionality is being introduced, and identify examples where this has been done well.

Why is Local Conditionality Being Introduced?

Local authorities have had to introduce a whole raft of changes to their local welfare systems.  Some obvious examples are:

  • Local council tax support schemes have replaced the nationally administered Council Tax Benefit.
  • Discretionary Housing Payments (DHPs) have been introduced to mitigate the impacts of under-occupation and the benefit cap.
  • Local Welfare Support has been introduced by upper-tier (and single-tier) authorities to replace parts of the Social Fund.

There are three key drivers behind the need to introduce an element of conditionality in these local schemes.

The first is the introduction of grant-based funding. Whilst demand for support increases, the amount the local authorities have available to them is often fixed. Council tax support is paid to Councils as a fixed grant and is no longer a flexible subsidy. In other words, Councils need to ensure that they do not overspend the amount of grant allocated to them.

The second driver is the need to determine who receives support, either though discretionary schemes, like DHPs, or by determining the rules governing the allocation of the local support fund.

The third driver is the need to support wider welfare objectives where they are designed to change behaviour. Previously, many local authorities saw their role as processors of Housing Benefit and Council Tax Benefit claims. Some local authorities now see themselves playing an important role in supporting people to take steps into work, or toward greater independence.

As one local authority put it:

“We want the council to move beyond sticking plaster solutions.

If we can promote work and independence by understanding who is impacted by welfare reforms and working closely with partners, we will have more resources available for people that still need our support.

We have an obligation to protect and support the most vulnerable.”

It is that last sentence that provides the greatest justification for conditionality, but does it work?

What Do Well Designed Local Schemes Look Like?

Well-designed local schemes have the following features. They:

  • Encourage people to engage in support services.
  • Offer support services that are tailored to make a difference in people’s lives.
  • Ensure that the right support gets to the right people
  • Are well-integrated so that it is clear exactly what support services any one household is receiving and duplication is avoided
  • Fall within allocated budgets, so that other council services are not affected.

To appreciate the potential benefits of local conditionality, local authorities need to understand the risks when schemes are poorly designed.

Some people may be more or less likely to take-up support; people in social housing are more likely to receive discretionary housing payments than people in the private rented sector, when controlling for the impact of welfare changes.

This can in turn lead to a council over or under-spending their local support budget; particularly when they have to factor in other welfare reforms, which can impact on entitlement for means-tested local schemes.

When considering conditionality specifically, it needs to be thought through.

Advisors need to know the customer’s circumstances, and be properly trained in order to be able to recommend actions that actually help the customer toward independence. Poorly applied conditionality can cause people to disengage from the benefit system.

“If you make me jump through any more hoops, I just won’t bother.”

Policy in Practice and the Welfare Reform Club have worked with a number of local authorities, including Leeds, Birmingham, North Hertfordshire, Newcastle and a group of Welsh local authorities, to design effective local support schemes.

Setting Sensible and Flexible Criteria for DHP Award Decisions

Local authorities are responsible for setting sensible criteria for Discretionary Housing Payments, so awards are not left entirely to the whim of the front line advisor.

The decision and subsequent review process needs to follow set criteria, and can lead to over or underspends as the council cannot predict which cases will present.

The Welfare Reform Club worked with 20 out of 22 Welsh local authorities to create flexible but robust criteria that led to a better allocation of scarce DHP resources. The process is in three parts:

1. Financial Assessment

The first step is for each applicant to undergo a financial assessment, that determines at the outset whether there is a need for support

2. Priority Cases

Then each applicant’s circumstances are put into priority order. For example, cases of domestic violence, or severe disability may be assigned a higher priority.

3. Other Policy Considerations

Wider policy considerations such as the applicant’s ability and willingness to change their circumstances are also considered. Applicants who are making a real effort to improve their circumstances (e.g. by looking for new accommodation or taking in a lodger) would be more likely to receive an award than someone who was making no effort at all (but could do).

The real strengths in this framework are its flexibility and the ability to reach consistent and justifiable decisions, without fettering discretion. Those councils that are underspending their DHP allocation can lower their scoring criteria, while overspenders can tighten their criteria.

Policy in Practice has automated the financial assessment for a number of Welsh Authorities. To find out more, please contact janet@policyinpractice.co.uk.

To find out more about the DHP framework, please contact Paul Howarth (paul@welfarereformclub.co.uk).

A Conditional Council Tax Support Scheme

We were asked to work with one local authority to design a Council tax Reduction Scheme that promoted work. We looked systematically at incentives, conditionality and support to help determine the most effective scheme.

We quickly found that improved work incentives within council tax support would have little impact. Any positive impact would be dwarfed by poor work incentives within nationally administered benefits such as JSA.

This particular local authority did have a sound approach to providing local support, but was struggling to get people to engage in taking up the training and employment support that was available.

We helped them to design a scheme that:

  • Targeted people that were able to find work, while protecting those that were less able. We analysed their Housing Benefit data to identify people with low, medium and high barriers to work.
  • Encourages engagement from people, effectively by introducing conditionality. Those that receive council tax support, and are deemed to have low barriers to work have to engage with council services in six months, or see their council tax support fall.
  • Provided personalised support which is critical to this approach being effective. Local authorities are able to take a broader definition of progress than the JCP. The council gave the example of a resident who was largely housebound, and now takes part in a gardening scheme, as successful engagement.

It is critical that local schemes are tailored to local circumstances. Using conditionality to encourage people to engage where support is limited, hard to access or of poor quality would be difficult to justify.

We have worked with a number of local authorities to design council tax support schemes that suit local circumstances. For more information, please contact janet@policyinpractice.co.uk.

Designing Effective Local Schemes

Policy in Practice and the Welfare Reform Club have helped local authorities to develop a range of tailored, and cost-effective local support schemes.

Our key aim is to ensure that the right support gets to the right people at the right time, so that local authorities have the resources to support their most vulnerable residents.

  • We helped one local authority to safely eliminate a £500,000 underspend, and helped them to forecast the future cost of local schemes accurately.
  • We can help to develop new policies based on sound, analytical criteria that can then be recommended to cabinet.
  • Schemes can be tailored to suit both the current benefit system and Universal Credit.

If you would like to learn more about our online application and assessment tools, want to learn more about how local conditionality can be effectively applied, or about the local schemes we have developed with local authorities, please contact us.

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