Rent Assistance Fund
North Lanarkshire Council · 15 February 2023
Back to Housing Committee — 15 February 2023 and its agenda
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North Lanarkshire Council Report Does this report require to be approved? ☒ Yes ☐ No Ref SL/ GW Date 15/02/23 From Stephen Llewellyn, Chief Officer, Housing Management Email Llewellyns@northlan.gov.uk Telephone 01698 274162 Executive Summary The purpose of this report is to establish a new fund to assist tenants who are falling into rent arrears due to the impact of the cost-of-living crisis. The purpose of this flexible funding is to enable the Council to adapt to the emerging needs of council tenants who are experiencing financial hardship. Recommendations It is recommended that the Housing Committee: (1) Approve the establishment of a Rent Assistance Fund to enable council tenants on low incomes and those on Universal credit and to help sustain tenancies (2) Approve the Universal Credit Assistance Fund (UCAF) to be included under this new fund and the Rent Relief Fund (RRF) to be re-assigned The Plan for North Lanarkshire Priority Improve economic opportunities and outcomes Ambition statement (11) Increase economic opportunities for adults by understanding, identifying, and addressing the causes of poverty and deprivation and barriers to financial inclusion 1. Background 1.1 As a result of the impact of Welfare Reform, the Communities and Housing Committee on 20 November 2019 approved the establishment of a £1million Universal Credit Assistance Fund (UCAF), which was funded through unallocated HRA reserves. 1.2 In June 2020, the Council announced the intention to expand the fund to include tenants who had fallen into arrears because their income had been affected by the Covid 19 global pandemic and they were suffering financial hardship. From this, £300,000 (of the £1million) was set aside for the Rent Relief Fund (RRF) to help tenants who had been made redundant, been furloughed, had hours reduced or were self-employed. Housing Committee Rent Assistance Fund
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1.3 In 2021 and 2022 direct funding was provided by Scottish Government to assist tenants with the impact of the cost-of-living crisis and impact of Covid. This funding was administered by officers in Housing Solutions. To date, the following financial assistance has been awarded to council tenants over the past 2 years: • £3,088,579 UCAF awarded to 7944 tenants • £787,727 RRF awarded to 1970 tenants • £405,495 funding from Scottish Government as part of the Tenant Hardship Fund was awarded to 335 tenants • £363,000 LACER funding from Scottish Government awarded to 384 tenants 1.4 As Committee will be aware, we are now experiencing a severe cost of living crisis. The impact of the Covid 19 pandemic, the war in the Ukraine and the disruptions to the global supply chains have all contributed to a rising rate of inflation which means day to day costs have escalated. According to the ONS (Office of National Statistics) the most recent rate of inflation was recorded in September 2022 at 10.1% meaning that the cost of everyday essentials is around 10.1% higher than in September 2021. The increasing day to day living costs, particularly around the cost of fuel, mean more tenants are now facing financial poverty for the first time and the hardship for those already in poverty is being exacerbated. A recent Committee report about tackling financial insecurity recognised that: Households worried about the adequacy of their budget may cut back or go without fuel, food or other essentials which can contribute to and exacerbate poor physical and mental health. 2 Report 2.1 While administering the above funds mentioned at 1.3, the Council as a housing landlord, recognised that there are tenants who do not qualify for any other financial assistance available from either the UK or Scottish Government other than the £400 energy bill discount. These tenants are on a low income but are over the threshold to be eligible for any other cost of living financial assistance and are experiencing financial hardship for the first time. They are struggling to meet the cost-of-living increases as well as maintaining rent payments. 2.2 Latest performance figures show that 10,116 tenants are currently experiencing rent arrears and just over 70% (7135) are in receipt of Universal Credit. The impact of Universal Credit on mainstream tenancies has resulted in an increase in rent arrears overall for tenants in receipt of Universal Credit. The average rent arrears for a tenant on Universal Credit (UC) has risen from £499 in 2014/15 to £544 for 2022/23, with this year’s figure continuing to follow the same trend. 2.3 The UCAF will remain in its current form however will be part of the overall new Rent Assistance Fund to be created. The criteria for this will not change and this fund will continue to be administered in the same way. 2.4 However, to assist tenants with no benefit entitlement and who are experiencing rent arrears and financial hardship it is proposed that a new Fund is established within the Rent Assistance Fund. This initiative will seek to ensure tenancies are not put at any more risk due to the cost-of-living crisis and tenancy sustainment levels continue to improve or at the very least, are maintained.
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The criteria for this fund will be: • Open to North Lanarkshire Council tenants only • On a low income but ineligible for any other cost of living awards provided by Scottish or UK Government such as Tenant Grant Fund or LACER Funding This approach will address the impact faced by low income families as wage growth in the last year has not been sufficient to keep pace with inflation meaning incomes are reducing in real terms. 2.5 Of the original £1million awarded to the UCAF and RRF, significant funding remains available. There are two main reasons for this. Firstly, there is a requirement for these funds to be repaid, and although no formal action regarding repayment has been carried out, some tenants are repaying or when the tenancy ends, the money is removed and repaid into the fund. Secondly, the demand for the RRF has reduced significantly since the end of the pandemic. There is £852,000 available between these funds and it is proposed that this money is moved into the new Rent Assistance Fund. 2.6 All payments of the fund will be authorised by a Housing Service Manager to ensure financial transparency and consistency and the Housing Solutions Manager will have overall responsibility for the administration of the fund. 3 Measure of Success 3.1 Success will be measured by a reduction of rent arrears experienced by tenants who are claiming Universal Credit as well as those with no benefit entitlement and will seek to sustain tenancies during this cost-of-living crisis. 4 Supporting documents 4.1 No appendices Stephen Llewellyn Chief Officer, Housing Management
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5. Impacts ( http://connect/report-template-guidance ) 5.1 Public Sector Equality Duty and Fairer Scotland Duty Does the report contain information that has an impact as a result of the Public Sector Equality Duty and/or Fairer Scotland Duty? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? If Yes, has an assessment been carried out and published on the council’s website? https://www.northlanarkshire.gov.uk/your-community/equalities/equality- and-fairer-scotland-duty-impact-assessments Yes ☐ No ☐ 5.2 Financial impact Does the report contain any financial impacts? Yes ☒ No ☐ If Yes, have all relevant financial impacts have been discussed and agreed with Finance? Yes ☒ No ☐ If Yes, please provide a brief summary of the impact? The cost of establishing this fund will be met from the existing UCAF and RR funds. The service will introduce measures to monitor utilisation of the resource within funding available which will be incorporated into future budget monitoring reports. 5.3 HR policy impact Does the report contain any HR policy or procedure impacts? Yes ☐ No ☒ If Yes, have all relevant HR impacts have been discussed and agreed with People Resources? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.4 Legal impact Does the report contain any legal impacts (such as general legal matters, statutory considerations (including employment law considerations), or new legislation)? Yes ☐ No ☒ If Yes, have all relevant legal impacts have been discussed and agreed with Legal and Democratic? Yes ☐ No ☐ If Yes, please provide a brief summary of the impact? 5.5 Data protection impact Does the report / project / practice contain or involve the processing of personal data? Yes ☐ No ☒ If Yes, is the processing of this personal data likely to result in a high risk to the data subject? Yes ☐ No ☐ If Yes, has a Data Protection Impact Assessment (DPIA) been carried out and e- mailed to dataprotection@northlan.gov.uk
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Yes ☐ No ☐ 5.6 Technology / Digital impact Does the report contain information that has an impact on either technology, digital transformation, service redesign / business change processes, data management, or connectivity / broadband / Wi-Fi? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? Where the impact identifies a requirement for significant technology change, has an assessment been carried out (or is scheduled to be carried out) by the Enterprise Architecture Governance Group (EAGG)? Yes ☐ No ☐ 5.7 Environmental / Carbon impact Does the report / project / practice contain information that has an impact on any environmental or carbon matters? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.8 Communications impact Does the report contain any information that has an impact on the council’s communications activities? Yes ☐ No ☒ If Yes, please provide a brief summary of the impact? 5.9 Risk impact Is there a risk impact? Yes ☒ No ☐ If Yes, please provide a brief summary of the key risks and potential impacts, highlighting where the risk(s) are assessed and recorded (e.g. Corporate or Service or Project Risk Registers), and how they are managed? The impact of rent arrears due to either Universal Credit or the cost of living crisis has been assessed as a key risk at corporate and service level. 5.10 Armed Forces Covenant Duty Does the report require to take due regard of the Armed Forces Covenant Duty (i.e. does it relate to healthcare, housing, or education services for in-Service or ex- Service personnel, or their families, or widow(er)s)? Yes ☐ No ☒ If Yes, please provide a brief summary of the provision which has been made to ensure there has been appropriate consideration of the particular needs of the Armed Forces community to make sure that they do not face disadvantage compared to other citizens in the provision of public services.