Saturday, 22 September 2012

Universal Credit

If you do the Twitter thing, follow me at @hotpixUK

Well, no doubt about it, if I had £50 for every passionate person in housing I have talked about this subject with, I would certainly have over a grand in my jeans back pocket by now! If you have been working under a stone for the last two years, Universal Credit will centrally replace six of the main means-tested benefits and tax credits in the UK into one single monthly credit. Many prominent figures including John Seddon (he of the ‘systems thinking’ approach), have already questioned the initiative. His open letter to IDS is here  I have more faith in John than "Iain Duncan Cough" (as Lord Gnome called him).

As you might have read in this month’s Housing Technology magazines article, "Welfare reform - Taking Credit where its due", which I was invited to take part in, I have strong feelings about it.  Download it here  it starts on page sixteen.

I don’t think it’s all bad however. I believe that the benefits system is a safety net provided by a fair and just society, it should not become a way of life. All my life I have been in employment and paid eye-watering amounts of taxes to support this and still do. Having seen systems in a number of countries around the world, imperfect as it is, this one is relatively good on the whole. A simplification should be a good thing. People like ‘simple’ don’t they?

Many of the changes that will have most effect on residents are the new way benefits will be received. Monthly not weekly rings alarm bells straight away. What percentage of poorer or aged residents now can navigate even through a week without the temptation of a ‘payday’ or loadshark loan? Many moons back I remember my teenage experience on suddenly moving from weekly to monthly pay. Even being money savvy, that s a big change. Even bigger is the way HB will be rolled up in that payment and will go straight to the claimant. I find it unlikely that the proportion that keeps the roof ever their head will be ring fenced in the family budget somehow.

Spookily enough so do thirty low-income households interviewed by Ipsos Mori this last week 17th September 2012, as reported in Inside Housing magazine. See this link to read the Inside Housing article.

‘This laissez-faire approach will create real problems not only for families themselves, but also for public service organisations, such as social landlords and childcare providers, that families will end up owing money to,’ he said.

The report notes the changes to housing benefit payments are also likely create ‘significant problems’ for social landlords, and could damage their credit ratings as their income would be seen as less stable.
It states: ‘The result would be that housing associations would have to pay more to borrow money, with knock-on implications for the building of affordable housing and new dwellings.’
A further angle on it from the Spectator Blog this week too here.

So what should RSL’s and Housing Groups be doing to prepare before October 2013 for this? Can IT and housing systems help? Most certainly your existing systems can help. I am sure there are few silver bullets to assist in this, however, don’t put faith in a great dashboard that for £20K can ‘drive insight into your resident arrears...’ or similar.

In my experience I have recently done work with a number of organisations who are only just tightening up the way their arrears procedures are married up with rent accounting and financial systems. Many are only just implementing workflow and (what I might term ‘smart’) arrears processing, including initial signup inductions. If your organisation does not use automated arrears or workflow in your systems, or maybe just in a cursory manner, it needs to be analysed and smartened up sharpish.

Auto arrears and particularly workflow is often left to phase 99 in a new HMS project. This is because its generally tricky, needs much involvement from the rents and management in a project team or capabilities were perhaps oversold in the first instance. Often too, solutions should span more than on system and supplier, so your prime provider will struggle to provide the best for you. In an internal project with one or more module ‘champions’, possibly utilising an outside consultant to inject new ideas and techniques and also engaging your suppliers too, you will stand a chance to drive improvements.

Signup and also annual tenant reviews are an ideal time to educate residents, link them with local credit unions, basic bank accounts and drive the move to a higher proportion of payments, in order to access HB via direct debit. If you are not already on AUDDIS, get on it either via your housing management system (if it supports it) or a supplier such as Bottomline . Closer relationships with residents will be needed, so your CRM module needs to be up to scratch, detailing all intercourse back and forth with your organisation. Consider opening up access to all your staff to CRM. Costs can be high, be sure to explore licensing models, often a ‘lite’ user licence can be available at reduced cost.Check you are leveraging all your communication options too, email, SMS TXT, autodailers, preferred languages, twitter, facebook etc.

Keep an eye too on how well your asset management system integrates. With the bedroom tax coming, that needs a serious consideration on bedroom / permitted person data. One for a future blogpost methinks!

Also don’t forget the economic times we are currently in.  Apart from whoever has got the gig to write the core system for the DWP, possibly usual suspects; Accenture and IBM, most suppliers keen for a deal can these days be more flexible on price. Don’t forget to ask for yours!

Many things are already universal.

(c) Tony Smith, Acutance Consulting

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