Key Policy Issues for Local Government:

Welfare Reform, Housing, Planning and

Devolution

WEDNESDAY 23 SEPTEMBER 2015

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Welcome

Mayor Kate Allsop, Mansfield District Council

Welfare reform

The reforms to date and the impact on

councils and communities

Rose Doran

Overview of reforms to date• There have been two main planks to the welfare

reforms to date:

– The introduction of Universal Credit for working age

claimants

– A range of changes to discrete working-age benefits, the

majority of which have entailed a reduction in spending

and more stringent eligibility and conditionality criteria

Current context

• The reforms to date have saved some money (but not as

much as planned)

• There is some evidence of behaviour change

• The newly elected Conservative government has a manifesto

commitment to deliver a further £12bn of welfare savings

• Universal Credit was a much more complex and demanding

undertaking than expected, but they are now making

progress

• The role of councils and local partners in supporting low

income households is at the heart of impact and

implementation

The introduction of Universal Credit

for working age claimants

Universal Credit• UC replaces the following benefits/tax credits:

• Working Tax Credit,

• Child Tax Credit,

• Housing Benefit,

• Income Support,

• Income-based Jobseeker’s Allowance

• Income-related Employment and Support Allowance.

• Working age

• Monthly payment to household

• Online claims and interface

• Processed by DWP through UC Service Centres

Universal Credit roll out• Live Service – began with new claims for single jobseekers in Tameside

(Ashton-under-Lyne) in April 2013

• Digital Service – Sutton; Croydon - <500 claimants

• All of North West from June 2014

• Couples in existing Live Service areas from Summer 2014

• Singles rolling out to remaining councils between February 2015 and February

2016

• Digital and Live service rolling out alongside one another from 2016; migration

of existing claims from 2018

UC and local government

• We won’t administer HB anymore (eventually!)…

• …funding and staffing while we do

• Supporting individuals and households with transition

and claiming (Universal Support delivered locally)

• Supporting DWP throughout transition and migration

• Our role in achieving and sustaining the over-

arching policy objectives…?

A range of discrete changes to

working age benefits

Overview of the reforms so far…• Started in earnest in April 2013

• Aimed to:

– simplify mainstream housing and employment benefits

– improve work incentives

– encourage personal responsibility

– target support at those who need it most

– significantly reduce the overall benefits bill

• Income of households claiming benefit estimated to be on

average lower by £1,615 a year – or £31 a week – in 2015/16

as a result of welfare reforms (Source: LGA/CESI 2013)

Summary of key Coalition reforms• Changes to Housing Benefit (HB) for renters in the private sector – reduction of the

Local Housing Allowance (LHA) from the 50th to the 30th percentile of local rents

• The removal of the “spare room subsidy” for most HB recipients in social housing

• The introduction of a cap on total benefit receipt

• Changes to tax credits

• Tightening of eligibility and the restriction of contributory Employment and Support

Allowance (ESA) to one year

• The replacement of Disability Living Allowance (DLA) with Personal Independence

Payment (PIP)

• The uprating of benefits and tax credits by 1% instead of the CPI

• The replacement of Council Tax Benefit with locally-determined Council Tax Support

schemes

• The replacement of the Social Fund with Local Welfare Support

• The introduction of Universal Credit

Review of savings from reforms to date

• The coalition government did not manage to realise all of its planned savings,

however, according to the Institute of Fiscal Studies (IFS) it implemented

changes that mean that spending in 2015/16 is £16.7bn lower than it would

otherwise have been.

• The Government is, however, arguably running to stand still: overall welfare

spending this year is the same as in 2010.

• The coalition also had to revise down some of its planned savings due to

incorrect assumptions and problems with implementation.

Projected vs actual savings (1)

Source: Gaffney 2015

Budget 2015

• £12bn further benefit cuts:

– £4bn from rate freeze – including LHA

– £6bn from changes to tax credits

– £1.4bn take-away from councils and RSLs – 1%

pa freeze on social rents (saving on HB)

Budget 2015

• ‘Restoring fairness’

– Benefit cap reduced from £26k to £23k in London

and £20k outside London

– Removal of HB entitlement for some out-of-work

18-21 year olds

– Shift from tax credits to ‘National Living Wage’

So what…?

LGA position

You can’t reduce the welfare bill solely by

cutting benefits you need to address:

• Housing costs (supply)

• Unemployment, underemployment and low

wages

• Resilience, life chances and the safety net

Housing

Housing Benefit

“In the case of housing benefit, underlying

macroeconomic and demographic pressures more than

cancelled out reductions in the generosity of support.

The OBR identify three such pressures in their Welfare

trends report: the growth of the private rented sector,

real growth in private rents and falls in real earnings.”

Source: IFS 2014

Housebuilding

Source: National Housing Federation 2015

Increase in HB claimants in work

Employment and skillsLocal areas need powers, funding and responsibilities to plan employment and

skills investment in their local area. In return, councils can reduce long-term

unemployment and better serve local employers’ current and future skills

demands.

A shared commitment 21 The Government can achieve this through the

introduction of Local Labour Market Agreements across England by 2016/17.

They should include devolution or co-commissioning of almost £3 billion

employment and skills funding, including the £100 million Flexible Support Fund,

the £2 billion adult skills budget and a dual scheme replacement for the £620

million Work Programme.

A shared commitment – local government and the spending review

LGA August 2015

Revised estimates of ESA savings

Integrated support for low income

households

ESA claimants

Sanctions

“Each month around 5% of JSA recipients are sanctioned.

After reconsideration and/or appeal, 29% of those who

receive their first ‘lower’ tier sanction have it overturned,

meaning around 5,600 of them a month are wrongly

sanctioned … meaning an estimated 68,000 people a year

wrongfully experience a sanction in this category. Given that

some estimates suggest that 43% of those referred to food

banks are there due to benefit stoppage or being refused a

crisis loan, this is a clear area of policy concern.”

Policy Exchange, 2014

Local safety net

• Universal Support delivered locally

• Local Council Tax support schemes

• Discretionary Housing Payment (DHP) -

£800m over the next five years

• Local welfare schemes - £74m 2015/16

• Troubled Families

• Child Poverty – life chances; income measure

Discretionary Housing Payment

The local safety net?• Local welfare safety net inquiry

• (Our long term role in benefit administration)

• USdl; local welfare schemes; DHP

• Making Jobcentres fit for purpose

• Co-location (e.g. Melton; Bassetlaw) – better integration of

employment, housing, money and other support

• Learning from Troubled Families

• Childcare

• Support for families and parenting

Questions and Answers

Child Poverty in the East Midlands

Rachel Clark, Nottinghamshire County Council

Child Poverty – current picture

and future developments

National picture

• Latest Household Below Average Income dataset indicates that national Child Poverty rates have remained broadly unchanged at 2.3 million

• There is a national Child Poverty Strategy in place running from 2014-17

• Based on the Children Living in Low Income Families dataset, there are 18.6% of children in England living in poverty . Challenging to accurately measure levels of child poverty as datasets are more than two years out of date.

• An obligation on employers to pay a Living Wage is a welcome development, however, this is needs to be balanced against proposed cuts in tax credits

• Research by Joseph Rowntree Foundation indicates that families with children are falling below minimum income standards

Minimum Income Standards

The Local Picture - data

• East Midlands – 17.6%

• Leicestershire 10.9%

• Nottinghamshire -16.0%

• Lincolnshire- 15.7%

• Derbyshire -15.6%

• Northamptonshire 15.1%

NB: Even some of the most

affluent wards contain pockets

of 30%+ children living in

poverty

• Nottingham 32.6%

• Leicester- 26.4%

• Rutland – 7.3%

• Derby -22.8%

• Lincoln- 22.4%

Proposed changes to Child Poverty Act

• Remove the duties on local authorities to produce local

needs assessments and strategies

• Remove the duties on government to meet the four

national child poverty targets

• Remove the duties on government to publish a three-

yearly child poverty strategy

• Replace income related targets with targets around

worklessness, educational achievement, drug and

alcohol dependency, family breakdown and debt

• Publication of Life Chances Strategy

Figure 1: Increased likelihood of child being in

low income according to several family

characteristics

Source: Analysis of drivers

of Child Poverty Now:DWP

June 2014

What is being done locally to tackle child

poverty?

• Regional child poverty officer group has been re-

established

• Each authority currently has a child poverty strategy.

This is usually overseen by a multi –agency group. Staff

with a detailed knowledge of the benefits system are key

members of these groups.

• A number of authorities are in the process of updating

their Child Poverty Needs Assessments – these will give

us a clearer picture of levels of poverty, the story behind

the data and what actions we need to take.

What’s being done locally

• Pupil Premium and Early Years Pupil Premium

• Early Education Entitlement

• Roll out of Troubled Families Programme – extension of

funding for a further five years

What’s happening in different authorities?

• In Nottinghamshire, we have rolled out Child Poverty Awareness

workshops for frontline staff, gives staff a clear understanding of

what they can do in their day to day work to mitigate the effects of

poverty

• Funding for Countywide information tackling financial exclusion

• Lincoln City – Lincoln against Poverty campaign

• Nottingham City – re-shaping information and advice provision

• Derbyshire – support for food provision across the County

• North East – poverty proofing schools

What works best ?

• Practical support for local people

• Children, young people and parents voices

• Political support and leadership

• All partners working together

• Good understanding of local needs

Focus for the future

• Need particular focus on care leavers and families with

disabled children

• Developing more joined up and consistent parenting

support – key to addressing the root causes of poverty

• Influencing perceptions of poverty

Contact details

• Rachel Clark

• Child Poverty and Parenting Manager

• Rachel.clark@nottscc.gov.uk

• 07788412312

Questions and Answers

Break

Housing Policy

East Midlands Councils

23 September 2015

*

SHARP PLANNING PLUS

Malcolm Sharp

SHARP PLANNING PLUS

The Lyons

Housing Review

Mobilising across the

nation to build the homes

our children need

SHARP PLANNING PLUS

THE REMIT

• Sponsored by Labour

• Independent

• Chair: Sir Michael Lyons

• Road map to secure 200,000 homes per year

by the end of the next parliament

Personal reflection not speaking for the Commission

SHARP PLANNING PLUS

THE CASE

• Good homes underpin all our collective ambitions –

stable communities, educational attainment;

“quality of life”

• A major contribution to a stronger national economy,

an important domestic industry, greater labour

mobility, building on opportunity

• Critical to the control of inflation

• Current system one cause of increasing inequaliity

SHARP PLANNING PLUS

• A housing crisis of our own making

• National focus on delivery

• Land supply

• Ensuring land is built out

• Communities driving their own development

• A new generation of Garden Cities and Garden

Suburbs

• The house building industry

• Quality, Design and Sustainability

• Housing for all

SHARP PLANNING PLUS

Two background Issues:

Enough land (in the right place)

(but its not all planning fault)

Capacity to build

(both more ‘developers’ and

‘construction capability skills etc)

But more complex than this.

SHARP PLANNING PLUS

0

50000

100000

150000

200000

250000

300000

350000

4000001

91

9/2

0

19

22

/23

19

25

/26

19

28

/29

19

31

/32

19

34

/35

19

37

/38

1940/4

1

19

43

/44

1947

1950

1953

1956

1959

1962

1965

1968

1971

1974

1977

1980

1983

1986

1989

1992

1995

1998

2001

2004

2007

2010

2013

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Local Authorities

HousingAssociations

CLG Figures

Real target to keep pace with need 240,000 +

Year to June 15

131,000

SHARP PLANNING PLUS

SHARP PLANNING PLUS

Some key Recommendations (39 in total)

1. Housing Priority for next Govt.

2. Consolidate and devolve funding

3. Local Plans requirement & needs asses.

4. Strategic Housing Market Plans – right to grow

5. National spatial priorities

6. Use it or loose it pp

7. Housing Growth Areas

8. New Home Development Corporations and

growth areas

9. New generation of garden cities/suburbs

10.Support for SMEs

11.Increase quality market rent product

12.Support LA investment

13. Quality / space stnds. / Bldg. for life

SHARP PLANNING PLUSLatest figures:

Housing completions year to June 15 – 131,060

Housing starts 136,320 – down 1%

Expert prediction in year 2020 range 138K – 180K

Need at least 240-245K pa* – (1.2M+ over parliament)

East Mids share 20.5K pa* (16.4K market 4.1K social)

Shortfall 2010/11 – 12/13 circa 400K

*Cambridge Centre for Housing & Planning Research 2013

SHARP PLANNING PLUSGovernment Policy

“Having your own place is an important stake in our

economy. It’s also one of the best expressions of the

aspirational country we want to build, where hard

work is rewarded.”

PM & C of Exch July 4th

SHARP PLANNING PLUSGovernment Policy

“The Government believes that wherever possible

planning decisions should be made by local people.

We will cut back on red tape and endless planning

documents to focus on what people care about – local

roads, schools and homes that meet local needs.”

“We will take action on councils that have failed to

produce a plan for the homes their community

needs”.

PM & C of Exch July 4th

SHARP PLANNING PLUSGovernment Policy

“Last year Councils across England granted planning

permission for 261,00 homes… It is all too easy to

blame the planning system and planners for the

challenges facing the housing market in particular, All

too easy and it would appear, wholly wrong.”

Brandon Lewis Housing and Planning Minister 9th Sept

SHARP PLANNING PLUS

New Government Policy

1. Help to buy

2. Starter Homes initiative

3. Right to buy

4. Help for small builders

5. Pubic sector land release

6. Brownfield Funding

7. Planning reform

PM & C of Exch 4th July

SHARP PLANNING PLUSBrownfield

There is “enough brownfield land for 400,000 homes”

PM & C of Exch 4th July.

• A zonal system – effectively granting planning

permission.

• £10M fund for local authorities to bring forward

brownfield sites to build starter homes for young

1st time buyers at 20% discount

• £26M to identify and purchase brownfield sites in

2015/16 not previously identified for housing.

SHARP PLANNING PLUS

Starter Homes

• 200,000 starter homes by 2020.

• £26M (see above) fund for housebuilders to

demonstrate a range of homes available for 1st

time buyers.

• Require local authorities to plan proactively for

the delivery of starter homes.

• Requiring a proportion of starter homes on all

reasonably sized housing sites.

• Starter homes to be exempt from levies for

example CIL.

• Monitoring how effective local authorities are in

delivering starter homes.

SHARP PLANNING PLUS

Planning

• 2017 deadline for producing a Local Plan.

“the Govt. will arrange for local plans to be

written where necessary”

• Continuation of permitted development changes?

E.G; office to residential

• Streamline the length and process of Local Plans

(panel set up last week).

• Tightening the planning performance regime.

(standards authorities – major applications)

• Fast track large mixed used schemes to be eligible

to go through NSIPS regime (LAs only consultees).

• Zero carbon targets scrapped.

• Upward extns. p.d. in London

SHARP PLANNING PLUSDevolution

• Planning powers to ‘city’ mayors

• power to designate Devel. Corps.

• revised CPO powers.

Gr Manchester, Leeds, Liverpool, Sheffield,

First non metro –Cornwall

Nottingham / Derby / Notts / Derbys?

Leicestershire / Leicester?

SHARP PLANNING PLUSHelp to Buy

• Equity loans

• Affordable Housing Guarantee scheme

• Help to buy ISAs

• £1 Bn. Build to rend Fund – 10,000 houses

Right to buy

• Extended to RSL tenants – up to 70% discount

SHARP PLANNING PLUSOther

• Housing Growth Partnership - £100M for small

builders – down by over 1/3 since mid 80s (50

investments – 2000 homes)

• Release of public sector land – 150,000 homes over

5 years

• Locally led Garden Cities / Towns - Ebbsfleet

• Crack down on rogue landlords and agents

• Benefit changes – benefit cap and reduction in

social rents

SHARP PLANNING PLUSReflections

• Housing high profile in policy announcements - the

devil will be in the detail

• Concentrates on demand side & home ownership –

welcomed by housebuilders – should increase house

building (recent starts down 1%)

• Benefit / rent changes likely to lead to RSLs

abandoning plans for 14,000 homes (Office for

Budget Responsibility) NHF says 22,000

• Subsidy to those buying increased rental subsidies

to people on benefits reduced (Financial Times July

11th)

SHARP PLANNING PLUSReflections

• Brownfield 400,000 - need for 1M+ over parliament

therefore greenfield inevitable.

• Brownfield sites are often disconnected from vital

social infrastructure such as schools, hospitals and

good transport links. Impact on neighbours? SEA?

• Who will provide infrastructure where levies waived

• Planning obstacles not as important as viability

issues.

• Use it or loose it policy not in favour

• Hope value for employment sites - where will jobs

go?

SHARP PLANNING PLUSReflections

• How to promote more Council House building?

• RSL building could fall – 2013 accounted for 24% of

all completions

• Adding up all the initiatives less than 245K new

homes p.a. needed - so backlog likely to increase.

• Many people will remain reliant on private rented

sector – need more protection?

• Spend on Housing Benefit - £24 Bn. (1/4 of UK total

deficit)

AFFORDABILITY

• Average home x8 average wage

• Av 1993 - £50K 2007- £184K 2009 - £150K 2015 - £188K

• House prices rising again – 5% pa?

SHARP PLANNING PLUS

Conclusion

• Work in progress some way to go yet.

“ important challenges on how the significant

volume of houses needed to address the housing

crisis remain” CEO Barton Wilmore

• Quality of what is built and infrastructure provision

also key challenges

Questions and Answers

EMC Housing Review

Cllr Chris Millar

EMC Executive Board Member

Introduction

Background

Objectives

Key Issues

Some questions

Next Steps

Background: Delivery

Background: Affordability

Housing Review Objectives

Highlight existing good practice by

councils in the EM and suggest how this

could be more widely deployed

Highlight to Government policy changes

which could help councils unlock local

housing delivery

Key Issues

Planning across

housing markets

Rural Housing

Delivery

Urban

Regeneration

Affordable Housing

Delivery

Impact of Welfare

Reform

Infrastructure

Delivery

Construction Skills

& Materials

Some Questions

What will be the impact of extending ‘right

to buy’ to Housing Association tenants?

Will the provision of discounted ‘starter

homes’ help to meet local housing need?

Is infrastructure still a barrier to housing

delivery?

How important is the provision of

traditional ‘social housing’ to your

communities?

Next Steps

Further information and examples of good

practice welcome

We are keen to produce something that is

rooted the our own experience but with

wider relevance – and national policy is

changing fast

Aim to publish at next EMC General

meeting (Feb 2016)

Questions and Answers

Lunch

Planning Policy

Current Trends & Future

Prospects

ANDREW PRITCHARD

DIRECTOR OF POLICY & INFRASTRUCTURE

Introduction

Review of recent history

2015: Fixing the Foundations

Likely main changes

Key messages for councils

Planning & Housing March 2010

Regional Plans

Local Development Frameworks

Regional allocations for housing, transport &

economic development spending

Fiscal stimulus boost to Affordable Housing

Programme

May 2010: Proposals for

Change

Localism & deregulation

System based on

neighbourhood plans

Removal of Government

targets for housing & planning

Fiscal incentives to encourage

house-building

Presumption in favour of

sustainable development

Coalition Policy in Practice

Abolition of regional planning (eventually)

Introduction of Neighbourhood Plans – but Local Plans take

precedence

A new ‘duty to co-operate’

Simplified statements of Government Planning Policy (NPPF) &

guidance

Deregulation of ‘change of use’ and permitted development rights

Re-introduction of council planning performance targets

2015 General Election

Major political parties

agreed on the need

for more housing &

growth

But they differed

fundamentally on the

means by which this

should be achieved

May 2015: Conservative

Government

“An excessively strict

planning system can prevent

land and other resources

from being used effectively,

impeding productivity…”

(para 9.4)

The planning system creates

a ‘…slow, expensive and

uncertain process’…(para

9.14)

Likely key changes…(1)

Streamline local plan process

Allow NISP regime to deal with housing-related

development

Take wind energy over 50 MW out of NISP regime

Introduce ‘zonal style’ planning for brownfield

development

Assumed outline permission for local plan allocations?

Likely key changes…(2)

End commitment to Zero Carbon Homes

Statutory register for brownfield land

Devolution of planning powers to CA mayors -

and potentially powers to designate

development corporations

‘starter homes’ to be classed as ‘affordable

housing’?

Key Messages for Councils

Get your plan in place!

Delivery is King!

Neighbourhood planning is here to stay!

Make co-operation work!

And finally….

Get your plan in place!

The Achilles Heal of the current system

is the lack of plan coverage

Without either Structure Plan or

Regional Plan - the local plan is the

only show in town

Councils must get plans in place to

retain a credible system

Ministers want a published plan by

2017 - or else!

Delivery is king!

Government is acutely aware

that development remains low –

and new starts actually falling

Credible 5 Year Housing land

supply is essential

Councils must act proactively to

get development away

Neighbourhood planning

is here to stay!

Neighbourhood planning is

a perceived success

Both Government &

opposition have voiced

support

Councils must work with

communities to support

neighbourhood planning

Make co-operation work!

There are no proposals to re-instate statutory strategic planning

Council’s must make co-operation work

More Joint planning arrangements – linked to emerging devolution deals?

And finally…

Treasury/LSE believe planning increases development

costs and is SO last century..

Current moves towards de-regulation could be a

prelude to move fundamental changes...

Do NOT take the current

planning system for granted!

Questions and Answers

Devolution & Combined Authorities

in the East Midlands

WEDNESDAY 23RD SEPTEMBER 2015

A focus for this Parliament

Treasury deadline 4th

September.

Spending Review 25th

November.

Cities and Devolution Bill

making its way through Parliament.

A focus for this Parliament

Devolution is happening

now.

Different models.

Historic opportunity?

What is Devolution?

Key to unlocking growth and improving

public services.

A genuinely different approach.

Fiscal Devolution

The 95% and 5% split;

central to local.

Over 60 central

government funding pots.

Policy Devolution

Lack of flexibility of

nationally developed

policy.

Benefits and skills system not working.

Bureaucratic, inefficient and unaffordable.

What Devolution isn’t!

Not about more taxes.

Not about new layers of Government.

Not loss of power to CAs.

Not loss of identity

Not about one governance model.

It’s Happening

38 submissions.

Most of East Midlands

covered.

Includes responsibility for

skills, transport, finance,

business support, EU monies,

health and social care,

housing and prisons!

So, What’s Next?

Government to respond

through Spending

Review announcement.

Process not clear.

And the Government

reserves the right to say

‘no’.

Summary of Proposals

D2N2

Leicester and Leicestershire

Greater Lincolnshire

Northamptonshire

Governance

Clear Government

expectation.

Arrangements will need to be

confirmed.

Scrutiny and public

involvement ‘gap’ (CFPS).

Summary – Opportunities

Releasing un-tapped growth

potential.

Rebalance economy.

Reforming public services –

better outcomes, lower cost.

Renewing our democracy.

Questions and Answers

Conference Close