Led by June Rawlinson and Madeline Chipunza from Liverpool CAB
June and Madeline presented the ‘dashboard’ reports for the second and third quarters of 2016-2017 (year commencing in April) which CAB provides each quarter for Liverpool City Council. The headlines were that in each quarter Liverpool CAB receives around 15,000 enquiries from around 9,000 clients, just more than half of which concern benefits or tax credits and around a quarter concern debt. The total amount of debt owed by the clients in each quarter was around £3m and in the year to date (i.e. the first three quarters) almost £3m of debt was written off and almost £3m of other financial gain was found for clients (e.g. grants or unclaimed benefits).
The most common benefit issue was the Personal Independence Payment (around 34%/38%) and 61%/65% of clients had some form of disability or long term health problem. Government statistics indicate that around 19% of adults in the UK have a disability or long term health problem.
Most clients attending CAB are middle-aged. There has been a lot of publicity about youth poverty and youth debt but young people do not often access CAB help: there was speculation that they could be more likely to use online help services or services targeted at young people.
The top debt issue was Council Tax Arrears (15%/17%). The background to this is that before recent welfare ‘reforms’ people on benefit received 100% discount on Council Tax, so they are not used to paying it. Now they receive 92% discount, but the remaining 8% is still a large burden for those on very low incomes, and when people are having to choose between paying something off their rent arrears to avoid eviction, paying utility bills and buying food, Council Tax, which was always unpopular, does not seem to have such a high priority. Liverpool City Council has tried hard to avoid putting undue pressure on those owing Council Tax Arrears and had a policy agreed with the CAB but recent changes to legislation have led to some problems with bailiffs arriving without due notice. A further complication is that if you miss one payment on a monthly payment plan, you become liable for the whole annual amount, unless you contact the Council and renegotiate the payment plan but, having missed one or more payments, the new amount will inevitably be higher and therefore harder to pay.
Council Tax Arrears, combined with relatively high numbers of citizens on benefit receiving 92% discount and relatively low property prices, impact on the City Council’s budget and render the Government’s recent decision to allow Councils to bring forward a 3% in Council Tax almost irrelevant in Liverpool. At recent briefing of Church leaders, Mayor Anderson had explained the massive cuts in Central Government Funding of the City, which has already seen its budget cut by 58% (whereas some Shire Counties had been cut by as little as 3%)and faces a shortfall of £58m in the coming year. The Mayor had called for Church leaders to join in a political campaign to change the basis of the allocation of Central Government Funding.
Concerns were raised about the ability to increase the re-payments rates of Council Tax and of Council Tax arrears. This concern relates to the falling rates of benefits and benefit cap introduction, labour market changes, and the increased cost of living. Advice agencies can support the City Council in promoting the greater repayment of Council Tax and Council Tax Arrears to create a win-win; but to do so would further tighten the income expenditure balance. The CAB, although dealing with around 9,000 clients in each quarter, had issued only 425 foodbank vouchers in the second quarter and 511 in the third. No statistics were available about how many foodbank vouchers were issued or redeemed in Liverpool as a whole, nor about what proportion of CAB clients are offered foodbank vouchers but refuse them, nor about whether CAB clients may have received foodbank vouchers from other providers. In line with Trussell Trust guidance, CAB and other Debt Advice centres only offer vouchers when the client is in immediate food crisis, i.e. has not eaten and has no prospect of being able to eat in the next day or so. Food crisis does not always happen at the same time as debt crisis or benefit issue crisis. CAB sometimes refers clients to other food providers rather than foodbanks, e.g. community feeding centres. Some clients are very reluctant to accept foodbank vouchers.
CAB includes information about Credit Unions in the financial skills training it offers and sometimes refers clients to Credit Unions, as do some foodbanks and other Debt Advice centres.
There was discussion of the Foodbank Plus model: some foodbanks have trialled different models for getting external agencies to offer some additional services at the point of foodbank delivery and there are anecdotal reports of some success, others report that clients are not willing to engage with other services. One example, in Bootle, works well where a particular advice worker has excellent communication skills, dresses informally and connects well with clients, but this is unusual. We were not aware of any published research into the effectiveness of providing such additional services. The North Liverpool Foodbank has concentrated on training the volunteers to make the most of the contact they have, trying to find one step which will help each individual’s situation, sometimes making a phone call or appointment for them.
June reported on the frustration of giving advice to clients, setting out the steps they need to follow, but knowing that many of them, especially those with mental health problems, have little chance of successfully negotiating the system to a successful outcome. Some Job Centres and some individual Job Centre staff are more helpful than others.
Some help centres, including foodbanks, provide computers with online access to allow clients to carry out the tasks required by the system, but some Housing Associations have reported underuse of such facilities when provided.
Trussell Trust have asked DWP to provide a ‘hotline’ facility for foodbanks and debt advice centres to be able to advocate on behalf of clients as the average wait to get through to a Job Centre by phone is 45 minutes.
June reported that the structure of CAB in Liverpool is about to change: multiple centres will be maintained but under a central management system. Some branches have closed and the availability of independent services often varies because they depend on short term funding. Having trialled an ‘appointment only’ system, CAB has reverted to trying to deal with every enquiry when people turn up. Waiting times vary but anyone arriving within the advertised opening hours will be seen.
Utility companies vary greatly in their treatment of clients with arrears, and practice within the same company can vary with a change in local management. June circulated a report on the experience of CAB clients in North Liverpool in the winter of 2015/16 entitled ‘The Heating or Eating Quandary’ which details shocking experiences, including 27% of respondents have gone without meals so their children could eat. The experiences reported were worse for social housing residents than for homeowners and worse again for private tenants. Problems were also more severe for those on prepayment meters.
Madeline highlighted concerns about the deductions for debts from the new Universal Credit. Legislation allows up to 40% of the entitlement to be deducted to pay off debts (i.e. up to £29 out of a typical Universal Credit entitlement of £76 per week) but DWP has refused to disclose what system they are using to prioritise which debts are enforced with deductions and in what amounts. One example is that Magistrate Court Fines, which are ‘Priority Debts’ when they are deducted from legacy benefits (income support, income-related ESA, Income- based Job Seekers, etc.) it is at £5 per week. For those claimants on Universal Credit they will see much higher weekly amounts deducted of up to 40% of their standard allowance. Kevin raised the question of which utility companies, private landlords and other agencies had contracts with DWP to reclaim their debts via these deductions, which seem to be disregarding the agreed practice of individual choice – and may impact on an individual’s ability to afford food, energy and other day to day items. Kevin reported that Debt Advice services had seen Universal Credit statements where the deductions, including sanctions, resulted in a zero total – no benefit being paid to the claimant. The decisions appear to be made automatically at centres remote from the claimant, raising concerns about the opportunity for a person to self-advocate and discuss their personal situation. We agreed that this specific question of the policy governing deductions from Universal Credit should be referred to Frank Fields via Andrew Forsey.