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Councillors receive update on Welfare Reform

06/03/13

Councillors were today [Wednesday 06 March] given an update on the planned changes to the welfare benefit system and the work being done by Aberdeen City Council officers to prepare for the forthcoming reform.

The Welfare Reform Act completed its passage through the UK Parliament in March 2012 and received royal ascent on 05 March 2012. This legislation will bring about the most fundamental reform to the social security system since its inception.

Its primary purpose, as stated by the UK Government, is to deliver a system that is simpler and fairer while ensuring that work always pays.

Many of the proposed changes will not be introduced until April or later and include:

Consolidating a range of existing benefits to a single household benefit known as the universal credit. This will be paid directly into a bank account on a monthly in arrears basis;

Changes to the under occupancy rules concerning social housing benefit entitlement. This will involve a reduction in housing benefit for people of working age who are living in social housing, deemed to be too large for their needs. Aberdeen City Council has identified approximately 9% of its 22,000 tenants who are likely to be affected by this;

Abolishing the discretionary social fund and transferring funding for community care grants and crisis loans for living expenses to the Scottish Government. Scottish Ministers and Cosla have agreed that councils will assume the operating role for the successor scheme, initially for two years;

A cap on the amount of benefits a household may receive, ensuring that an individual's total benefits package does not exceed the average working wage of around 26,000. The Department of Work and Pensions has intimated that 163 residents in Aberdeen will be affected by the cap;

Phasing out the disability living allowance and replacing it with a new personal independence payment which will be paid at two varying levels focussing on daily living and mobility elements.

Reductions have already taken place in the local housing allowance for tenants of private landlords. In addition single people aged under 35 in private rented property now only receive housing benefit at a shared accommodation rate, i.e. enough to cover the average cost of a single room in a shared house.

A report before councillors today [Wednesday 06 March] said Welfare Reform will have significant implications for all Scottish local authorities and the timeframe that has been set by the UK Government for its implementation is challenging.

Aberdeen City Council Head of Housing and Community Safety Donald Urquhart said: "Aberdeen City Council is working proactively to adapt to this complex program of changes and we are undertaking a wide ranging communication exercise to ensure council tenants are aware of the potential impact.

"We have employed additional housing officers to ensure our housing and homelessness services are fully supported throughout this process and continual training of staff is taking place so they can address any concerns that might arise.

"Aberdeen City Council is aware of the possible risks presented by Welfare Reform and has set aside a contingency fund to support the changes and manage the risk.

"We will continue to work with council tenants, the wider community and partner agencies as we respond to the challenges presented by Welfare Reform."

Councillors agreed to note the report; approve the steps taken by officers to develop a policy and practice response to Welfare Reform; and receive further reports in due course as Welfare Reform measures are implemented.

It was also agreed that the council leader writes to the appropriate Scottish Government Minister asking them to identify changes to legislation through which the Scottish Government may assist the council in dealing with the impact of Welfare Reform in the city, noting that Aberdeen is the lowest funded council in Scotland, ranked 32 out of 32 in relation to per head of population.