You could be forgiven for feeling like your head’s in a spin, given the number of political U-turns made in recent weeks. With the new Chancellor – the fourth since July – ripping apart the economic plans laid out by the shortest-serving Prime Minister, Liz Truss, one would hope the influence of his predecessor (twice removed), and now PM, Rishi Sunak, may bring a certain amount of economic certainty, following a disastrous ‘mini-budget’ that left markets reeling and the majority of the Cabinet looking for a new job.
At a time when local authorities are looking for stability and direction from central Government, the last few months have been far from it. In recent weeks, the Government has come under significant pressure from its own MPs to ensure benefits rise in line with inflation. Certain benefits, including disability benefits and carer’s allowance, must increase in line with prices by law. However, for working-age benefits like universal credit it’s down to the Government to decide whether a rise will be linked to prices or wages. All eyes will be on the next fiscal event, the Autumn Budget, as Jeremy Hunt attempts to claw back some confidence, laying out ‘properly budgeted’ plans, which will hopefully include some clarity around benefits.
It’s precisely that issue, and how we support the most vulnerable people in society, that formed part of our recent ‘State of Emergency’ webinar, where we spoke with a panel of local authority experts to explore the issues being faced in the sector as a result of the current economic climate. We were joined by Ian Ferguson from the IRRV, Nick Rowe from the London Borough of Ealing, Newcastle City Council’s Andy Jeffs, Kevin Shaw from the Money and Pensions Service, and Louise Freeth from the Royal Borough of Windsor & Maidenhead.
Freeth described the ‘benefits world’ as a “complex picture” directly impacting those people who have to make practical decisions about their working life.
“The announcements will only go one way, which is increased sanctions for those people who don’t necessarily do what the DWP wants them to,” she said. “The knock-on effect for us, as local authorities, will be people yo-yoing on and off council tax support which, in turn, will push back recovery.”
The panel agreed that the situation is likely to get worse before it can get better – for customers and for local authorities dealing with both CTS claims and council tax recovery. “The headlines are very simplistic, compared to what lies beneath,” Freeth said.
Currently, there is an estimated £15 billion worth of benefits not being claimed by people who are entitled to it. This includes £2.7 million of unpaid CTS. Andy Jeffs said: “We need to do as much as we possibly can to identify those people who are not claiming. That is a challenging question we need to ask ourselves.” Unsurprisingly, the conversation steered towards the increasing problem of homelessness – not just in terms of dealing with those who are already homeless, but preventing at-risk households from falling into it.
“We’ve got a significant part to play to prevent homelessness,” Nick Rowes commented. “The outturns are horrific for the customer and there are significant impacts financially for us as an organisation, which, given the current budget situation, we just cannot afford.”
The panel called for a more holistic approach to dealing with vulnerable customers, looking more long-term at improving people’s financial prospects to help prevent the likelihood of homelessness. “Research shows that effective early intervention can reduce the personal financial cost of homelessness,” Jeffs said. “The problem is identifying those households at risk. We need to pool our resources to help people help themselves.”
Part of this approach is around the Government’s debt respite scheme, ‘Breathing Space’, which has been met with mixed reviews since its launch. With consultations also underway around the Statutory Debt Repayment Plan, the question to the panel was whether they were workable, with just 64,000 ‘Breathing Space’ applications granted across England and Wales since April 2022.
“If we can bring the two together, hopefully it will provide that extra space and resource for those people suffering from multiple debts to help them deal with them in one go,” explained Jeffs. With people having multiple debts across the local authority piece, from rent to council tax, Jeffs said it was vital that all of that information was brought together in one space to help drive up collections. “It will also help residents who are having to pour out their story multiple times to multiple people in order to get the help they need.”
Revenues and benefits has always been at the forefront of implementing new and innovative ways of delivering services – no more so than in the current climate, which is changing politically at a rapid pace from one week to the next.
“We have gone a long way to implement digital and automated solutions, but there’s still a lot more we can do,” Jeff explained. “If we can remove those high volume, low value tasks, then we can reallocate resources to areas that really impact and drive up the benefits and outcomes of our residents.”
Rowes concluded: “If people cannot afford to pay, what’s the point in forcing them into more debt? We need to have more direct engagement with those harder to reach customers.”
That approach to proactive customer engagement, while harnessing the power of behavioural insights, data science, and digital communication, is demonstrated perfectly at Middlesbrough Council. Middlesbrough, the fifth most deprived local authority area in England, has embraced the challenging task through its successful three-year partnership with Voicescape, resulting in an increase in the engagement rate with residents in council tax arrears by 59%.
To view the ‘A State of Emergency’ – tackling the cost-of-living crisis in local government webinar, visit https://info.voicescape.com/revs-bens-replay-form
Sean Sutton is Head of Local Government at Voicescape – a customer engagement technology business providing solutions for local authorities and social landlords.
This article is sponsored by Voicescape.
