Impact of Welfare Reform Developing an effective local

Impact of Welfare Reform Developing an effective local

Impact of Welfare Reform Developing an effective local response HaringeyStat - June 2016 Why is this a focus? 2 Haringey households are being affected by the cumulative impact of welfare reform Changes: Underoccupation LHA cap Benefit Cap 26k Reduction in Council Tax Support

18-21 and Housing Benefit Benefit Cap 23k (Carers Exempt) 18-21 Earn to learn Cut to tax credits for third and subsequent children Freeze in working age benefits including the LHA rate Housing Benefit

capped at LHA rates for new social sector tenancies ESA claimants in work related groups receive JSA rate Roll-out of Universal Credit?????? Mitigation : National living wage Up to 2015

30 hours free childcare for 3-4 year olds Rise in personal tax allowance to 12,500 (incrementally between 2017 and 2020) 2016 2017 3 2018 To 2020 22,696 households are affected 20% of Haringey Households These losses are to be

transitionally protected Up to 2015 2016 2017 2018 Universal Credit effect Numbers affected (negatively) 17,142

2,007 513 1,152 9,751 Newly affected (negatively) 17,142 460 173 686

4,397 Average Weekly Amount (not cumulative) 25.04 76.67 Unknown 38.64 65.60 Main Group Affected

Privately Rented Lone Parents Single/ Private Rent Singles Private Rent 4 Some households are disproportionately affected by Welfare Reform

LONE PARENTS are overrepresented Covers around half of Lone Parent households in the borough PRIVATE RENTED sector are overrepresented Covers around a third of Haringeys PR households 5 IN WORK are overrepresented 99% are

working age Overall, some households face a bigger financial loss from Welfare Reform The average loss over all households is 32.40 per week. 1,421 households will lose more than 100 per week. 6 Private Rent and Family Households will lose more 73% of

households that will lose over 100 p.w in total are in the Private Rented Sector. . Households with Children are slightly over represented, 59% of the cohort 7 57% of high loss households are in work, an over representation

Nearly all households lack the resources to cope with significant falls in household income 91.5% of households have less than 1,000 in savings 8 A small proportion of households are reliant on financial or other support from the Council 6.7% are in temporary accommodation and 1.3% are potentially in supported housing

1.9% are engaged with adult social care 0.7% are currently working with the Early Help Service, making up 8.5% of the service load In the last 3 years only 3.8% of this population enrolled in an Adult Learning Course, making up 13.6% of individuals on courses Nearly 600 households received financial support from the council in the past year 9

CASE STUDY: Clare is a lone parent with 2 children Diagnosed with depression Lone parent History of domestic violence CLARE aged 25 JOE aged 1 Homeless household in TA KAYLEY aged 6 Impact of welfare reform: Affected by benefit cap with shortfall in rent

of 22 a week. With benefit cap extension this will rise to 80 a week. Currently reliant on Discretionary Housing Payment to avoid rent arrears. 10 Question 1) How can we reshape our approach away from crisis support towards enabling households to become more resilient? 11 Main groups affected 16,722 unique households

91% of all households affected 2,839 1,327 2,164 1,748 12 Private Rented Households 13 PRS will lose 187% more than other

tenures 8,413 are already affected 1,509 are to be affected post 2016 308 of these are new Average loss of 52 per week 14 The PRS is becoming increasingly unaffordable, particularly for those on low incomes 47% of households renting in the

private sector are reliant on Housing Benefit to do so Rents in-line with London average and expected to rise by 4.1% year on year to 2020 whilst LHA is being frozen for 4 years... 15 By 2020 only a small proportion of properties will be affordable to those on benefits One Bedroom Two Bedroom

Three Bedroom 16 Four Bedroom 48% of the 3,164 households in temporary accommodation are affected by Welfare Reform 47% of homelessness Number of households in TA continues to increase Net increase of 4% (121 households) in 2015/16 approaches are prevented in Haringey

London Upper Quartile = 58% e.g. Barnet, Camden 17 The 8,721 PRS households affected reside mainly in the east of the borough The wards with the most Households are Northumberland Park and Bruce Grove where there is a high concentration of low income households 18 There is a higher level of loss in the west

of the borough Areas of the west with few individuals, however with significant losses. These are mostly singles and in work households who have higher rent rates 19 A majority of those private sector households are families and working households Lone Parents see the highest

impact, losing an extra 51.20 per week post 2016, over 3 times more than the remaining population. Mostly SINGLE and LONE PARENT households 57% are IN WORK but the average earnings are only 94.27 p.w (Haringey median: 439) 20 Lone Parent and Young Child are main

barriers to work May hav e other ba rriers 40% (3,507) households) have NO BARRIERS 21 How does Welfare Reform affect the housing situation of our case study family? Homeless as result of loss of PRS tenancy 22 shortfall in Housing

Benefit due to benefit cap increasing to 80 Placed in TA in a neighbouring borough since 2014 Reliant on DHP to meet rent shortfall 8th March 2014 15th May 2014 Approached homeless prevention team re possession order Family evicted - placed in TA by Council 22 1st June 2014 Homelessness decision Question 2) What can we do differently to prevent more households becoming homeless as a result of welfare changes? 23 In Work households 24

In Work households show a further over representation of PRS and Households with Children Privately Rented is significantly overrepresented with 57% of population. 67% of in work affected households These households lost the most pre 2016 and will lose more going forward. These households will lose 1.20 more per week on average overall . have children 25

Haringey has one of the highest proportions of low paid workers in London 34% (3,033) of the in work households affected earn below national minimum wage Haringey (26%) Average earnings are 153.35, well below Haringey median of 439 26 A high proportion of Haringeys in work

population are in elementary occupations The proportion of individuals in elementary occupations is 3.5% higher than London as a comparison Simple and routine tasks e.g. labouring and cleaning Haringey also has a higher proportion of people with few to no qualifications compared to London 27 Barriers to work

May ha ve other barriers 23% of the working population in Haringey are in Part Time occupation 48.3% of in work households affected have no barriers to work and so could earn more if only working limited hours, however there may be other barriers not recorded here The majority of remaining households have children as a barrier to further work. 28

Our case study family also has a history of low paid employment Previous employment at a fast food restaurant on minimum wage No qualifications Currently receiving an employment intervention to improve work readiness Had to give up work due to childcare commitments Impact of welfare reform: To gain exemption from the benefit

cap Clare must be working at least 16 hours a week. 29 Question 3) How can we restructure our interventions to address the impact of low paid, insecure work? 30 Large families & Lone Parents 31

Large Families and Lone Parents are particularly affected by Reforms Lone parents make up a large volume of households facing losses, with 7,245 households affected. Large families will lose more to reforms as these families require more expensive accommodation and higher child benefit payments often bring them over the benefit cap amount. 32 7,245 Large Family or Lone Parent households affected, mostly in the east of

the borough Large concentration of households in the east of the borough. The wards with the most Households are Northumberland Park, Tottenham Hale and Seven Sisters Childrens centres are focused in the East of the borough, with one floating team in the West. 33 High loss households are distributed across the borough Households facing high

losses are dispersed across the borough. Largest concentrations of highest average loss in Fortis Green, Alexandra and Seven Sisters These are generally households with more children, especially those in Seven Sisters where the majority have over 5 children. 34 Of families affected, the majority are In Work and renting in the Private Sector. Private Rent is even further overrepresented and will lose on

average over 3 times more than other tenure types. Those in work are the largest sector, accounting for 54% of the population 35 Out of work families will be more affected by 2016 Welfare Reforms 54% of families affected are in work. 35% of these earn below NMW Those not in work will be more significantly affected by the 23k benefit cap in 2016 36 Childcare is a key barrier to accessing work 94.4% of those families not in work have at least one barrier to work. The most common naturally being lone parents and young children. Childcare is therefore a key barrier to accessing work to mitigate welfare changes. May hav e other ba rrie Of households previously

capped at 26k of benefits, 55% cited childcare as a barrier to work 37 rs Sufficiency of childcare at borough level, but with barriers to access 257 42% Average weekly cost of a childminder 252 weekly income based on NMW

respondents needed additional childcare Provision is not necessarily in the areas or the type of provision that parents say they want. Differences in childcare capacity between NLCs, and lower penetration rates are identified in general terms in South East Tottenham and Wood Green. Use of family members to provide childcare is relatively high across all age ranges but particularly for the youngest age range of children. 38

A high proportion of Lone Parent households face further barriers in terms of qualifications The Lone Parents family type has the highest proportion of individuals with no qualifications. 22% have no qualifications, and over half have below level 3 qualifications. Haringey is in line with London 39 Childcare is a significant issue for our case study family Nursery/school at opposite ends of the borough makes work hours challenging

Has been reliant on childcare from family members Unable to afford a registered childminder Had to give up work due to childcare commitments Impact of welfare reform: Child Benefit payments take this family over the benefit cap level. 40 Question 4) How can we reconfigure our

resources to address the barriers to work that families face? 41

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