How The Universal Credit Roll-Out Will Affect You

Announced in 2010 and legislated for in the Welfare Reform Act 2012, Universal Credit is designed to replace six benefits and tax credits while simplifying working age benefits and incentivising paid work. By replacing income-based Employment and Support Allowance, Income Support, income-based Jobseeker's Allowance, Housing Benefit, Working Tax Credit and Child Tax Credit, parliament believes that they can bring "fairness and simplicity" to the social security system. However, many people which Universal Credit is affecting the most are asking at what cost.

     One such point of contention with the new system is that, while it is being integrated throughout the UK (very slowly, I might add), people are finding it increasingly more difficult to transition from the current Housing Benefit to Universal Credit. Stating that the new policy is too confusing, this is causing a lot of concern in the media. MP’s state that by 2023, they should have everyone transitioned to the new policy and they foresee no future issues with the transition period. Experts say otherwise.

Diminished Funding For Housing Benefits

     One issue that UK tax experts see as a problem is that Local Councils are already trying to operate the Housing Benefits system with limited funding and this funding is diminishing rather quickly as the government reallocates that funding to the new UC system. The system, and the necessary staffing to ensure the Housing Benefits system remains operational until 2023, are expensive and there will soon come a point where many Local Councils will begin shutting down the system early for lack of funding. This could leave some without benefits or with limited benefits which is cause for concern.

What Is The DWP’s Stance?

     As many who have already dealt with their Local Council and the DWP already know, there is no quick way to do anything and cases can often be forgotten or never even sent over to DWP. And even if they do, will the DWP support the workload or will they reject it and pass it back to Local Councils which will already be underfunded?

Why The Delay?

     So with the importance of transitioning from one system to another, why is there such as delay? The people do not have a choice in the matter and it is the government’s fault for many of the current delays in transitioning people over to the new system. This leads to confusion, frustration and suffering as some claimants are left without proper funding for their claims. With almost 50% of claimants already experiencing financial difficulties, 44% of claimants falling behind on bills and 50% of claimants having to obtain additional funds, these effects, which MP’s are calling “minimal” are actually quite the opposite.

     So where does this leave you? If you are confused by the new UC system and need assistance, contact Ctax.uk today and let one of our professional tax experts explain the Universal Credit system and help you navigate the transition process.

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Council Tax a History

Take a look at our Council Tax a History Video, its less than 4 minutes long, with some low key music!

Link to Council Tax a History video

Council Tax software -  time for a change?

By Russell Francis May 2018

Despite years of cutbacks and transformation Local Government budgets continue to come under pressure year on year, however, many elements of the budget remain a constant.

Is there an appetite/opportunity for disruptive technologies in the Local Authority legacy arena?

Since 2012 I have held the belief that there is opportunity to disrupt the status quo in Local Authority (LA) supply of technology.

 At that time I was employed by one of the big three suppliers to the social housing and revenues sections in LA’s. My remit was to explore strategic relationships both internally and externally, a big challenge considering the way our organisation was structured and rewarded.

Part of my research included establishing future trends, driven mostly by central government policy but also by the competition.

Central government at that time was pushing ahead with Universal Credit, despite the common view that this was another IT project doomed to failure, (we still wait to see the outcome).

The competition was limited to just three suppliers, neither of whom had ambitions to “stir the honey pot”.

 The Government white paper I was reading in 2012, explained that Council Tax Benefit would be abolished from April 2013, this I thought must create a huge opportunity to provide something new in the Revenues & Benefits world, perhaps a cloud solution, “a turning on of a technology tap”, which would also potentially  feed our main stream business of Outsourcing.

Alas, my paper was rejected out of hand, the general attitude was nothing will change, UC will fail and we can carry on “milking” the base indefinitely.

That attitude remains, and to be fair has been very profitable, so nearly 5 years have passed since Council Tax Benefit was abolished, the winding down of Council processing of Benefits is around the corner.

A majority of LA’s now have Council Tax Support schemes, which mean most working age bill payers are expected to pay something, those rules vary from place to place, some 67 LA’s expect a minimum of 20% and a parameterised approach from technology must match local concerns.

Housing Benefit systems will be wound down as UC is rolled out, chasing Ctax debt from the poorer in society is stressful and could cost the LA more to collect than the outstanding amount. If costs can be reduced in this area then perhaps Ctax support schemes can be improved.

Is now the time, to turn on the tap for a new way of processing and production of local tax bills?

Your comments are very very welcome.

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Council Tax time for change? FOI Results

 

I have now completed my first ever batch of FOI requests.

180 requests in all to English Local Authorities in the South East, South West, East and North East.

Interesting to note the method that LA’s receive them, many have a dedicated FOI email address which is helpful, a number have Web forms which require repetitive entry.

The five questions were designed to be kept as simple as possible, however, the responses still had some variations!

Questions included; the name of the supplier and of the 180 only two organisations did not use the three main suppliers, choosing to write in house solutions.

My key question was the cost of annual maintenance for the Council Tax system, in about 30% of responses this was provided, in approximately 50% of replies the figure could not be broken out from the cost of Council Tax, Housing Benefit  and NNDR (Business Rates) as complete solutions.

Interestingly 20% either did not provide a reply or would not provide a figure stating “Commercial Sensitivity”.

I have asked the ICO for clarity on this point, as supplier spends above £500 are routinely published as yet no reply from them, perhaps busy on other more pressing concerns.

The other significant question, which turned out to be the most difficult for the Authority’s to answer was the cost per bill produced (excluding employee costs).

This would be an excellent benchmark as all LA’s have the same requirements to collect local tax, there will of course variations depending upon local demographics,  which would be largely dissipated by employees costs, the assumption being the more difficult environment for collection will require more people but should not impact the cost of the technology.

Keeping it as simple as possible, the variations in annual maintenance cost range from 7p per property to 77p per property. There appears to be no rhyme or reason for the variations, all three major suppliers have customers in the highest 15 and lowest 15 spenders and scale i.e. size of organisation also seems to be largely irrelevant.

 For what it’s worth the average cost per property is 30p.

 

Russell Francis

IRRV Member