Senior officials at Stirling Council have warned of the far-reaching impact on local people and the council of sweeping UK Government welfare reforms.
As well as potential job losses within the council’s housing service, there is expected to be massive increased pressure on the council to pick up the pieces as locals – mostly the area’s poorest and most vulnerable – are forced to take the changes on board.
Senior officials are involved in extensive work to assess the risks and soften the blow where possible.
But they warn of “significant potential financial and reputational risks” to the council, amid lack of detail from the Department of Work and Pensions. They claim changes will create considerable demand for advice and other council services as families come to terms with the new regime.
There will also be an increased need for household budgeting, particularly as housing benefit will now be paid to tenants to pass on to their landlord, rather than them receiving it directly, and for many there will be “capping” on benefit payments.
Increased rent arrears are said to be a risk, with a “fundamental rethink” required as tohow rents are collected from tenants. One of the main concerns is housing benefit applicants will be penalised if they underoccupy their homes.
Their report to councillors states: “As from April 2013, housing benefit will be restricted for those tenants in the social rented sector who are considered to have extra bedrooms in their property.
“For those under pension age, there will be a 14 per cent cut in housing benefit for having one extra bedroom and a 25 per cent cut for having two or more extra rooms.
“Recipients will have the choice of making up the difference but this must be found from within their household budget.
“Our early research indicates around 800 council tenants will be affected, losing on average £10.30 a week. There are also an estimated 400 housing association tenants who are thought to be under-occupying their property.
“If these cases lead to increased rent arrears, and therefore increased evictions, this could have an impact on the number of approaches to the homeless service.
“This is likely to cause a problem for tenants as there is a lack of suitable smaller properties.
“There are currently around 1600 applicants on the waiting list for one-bedroom properties compared to just over 1300 such properties in the housing stock.
“One potential benefit of the under-occupancy rule is it should lead to tenants requesting a property more suited to their needs, thereby freeing up larger accommodation for those suffering overcrowding.
“The downside is people may be ‘forced’ out of their family home after dependents have moved out and a lack of suitably sized accommodation could lead to people being forced to move away from employment, family and support networks.”
The officials say there is scope to use Discretionary Housing Payments to make up the housing benefit shortfall but it is unlikely to be enough to meet demand and is only intended to be a short-term measure. It could be used in a number of “under-occupancy” scenarios such as: separated parents (only the primary carer can claim for a room for children); foster carers; in the event of lack of suitable accommodation; accommodation adapted for use and occupied by a disabled person; where a dependent child will shortly require their own room; or where a baby is due.
The report adds: “Replacement of Disability Living Allowance by Personal Independent Payment could also see levels of award paid to many disabled people reduce or cease.
“While the levels of benefit may reduce an individual’s care and support needs will remain.
“This may result in a substantial increase in demand for social services.
“The council may also be required to develop new procedures to assess if claimants are entitled to ‘passported’ benefits such as free school meals, clothing grants, blue badges, leisure service concessions, disabled adaptations, garden maintenance and bin pull-out.
One disabled person said: “I have an extra room as I often need a carer with me. I couldn’t afford to pay for that and I’m worried it could force me out.”