We here at ^Housing Futures strive to bring the latest and most interesting developments to our readers in the field of social housing. The changes in the UK around social housing in the last few years have been dramatic and shifting. Universal Credit is one of the largest changes in social housing anywhere in the world. The idea of shifting housing subsidy to the tenant to pay rent in lieu of sending it to the landlord is interesting but also potentially devastating for those who have a hard time managing finances. The number of residents with rent arrears has spiked in the UK and could continue to do so. The article today deals with some of the pressures these changes are putting on housing associations.
In the U.K. we have seen constant change in regulation, rules and policy over the last decade. We have also seen the largest change the government has introduced in the recent welfare changes, specifically around what they ‘coined’ universal credit. I use the word coined as the financial impact this change alone is having on every day people is terrible. Some, already struggling to pay their rent, are seeing very long waits in receiving their benefits to then be able to pay their rent and as a result get further in debt. So, who struggles? Well, it is obviously the tenant.
The Scottish Federation of Housing Associations recently stated that one landlord responded to a survey saying:
“Universal Credit claimants make up 21% of our tenants – but they account for 59% of our rent arrears. Tenants who have Housing Benefit paid to themselves, and are responsible for making rent payments, make up 3% of our tenants but only account for 0.5% of our arrears”.
That is quite incredible.
So, with all of that, Universal Credit is indeed causing some large concerns. It is also just one area of change that landlords up and down the country are challenged with. Leaders in social housing have seen other changes forced upon them as well as the Universal Credit. It all mounts up to one large mess, and there are lessons to be learned.
The issues with Universal Credit have indeed been documented in many articles, newspapers, television documentaries, and news reports. You just need to google it, and you’ll see the mess we are currently facing.
But here is another angle.
When changes are made from above, you can imagine the conversation:
‘Oh, tell you what, Universal Credit is a good idea, let’s do that!’
‘Yes, I agree, let’s do it’
‘So, we should get some ‘experts’ together and come up with a plan’
‘Yes, let’s do that’
‘OK, let’s do that’
And with that approach we are in such a mess. We even have some of the housing federations in the UK calling for a pause of the roll-out as it such a calamity. So, what did these experts do? How did they get us into this mess, and what lessons can we learn?
One thing they perhaps didn’t do was to look at the IT systems in play that help staff manage these areas. On top of the IT systems, the associated changes required within landlords to deal with Universal Credit are considerable. What about the way staff work, the changes required to their jobs, the different responsibilities they now have to their tenants, who are getting more and more in debt.
One of the biggest lessons learned is the underestimation of the impact such large changes have, and this applies to not just Universal Credit, but other changes such as the GDPR, the new data regulations in the U.K.
It is not unusual, and this is the strangest thing, for IT implications to be down the list of priorities of the change makers in government. It is strange as it is the IT systems landlords use that are the single biggest and I would argue the most important tool they have in managing it all.
Here are just a few examples of the underestimation that may have been made:
- Software vendors will have to make changes to their systems. This costs them development time, and these costs will at some point have to filter to their customers, the landlords.
- The landlords need to implement these changes from the vendors above which costs time, and money.
- While the vendors and the landlords take their time to implement these changes (it’s not an easy overnight thing), the tenants are getting more and more dismayed and in debt.
- Processes, procedures and indeed policies will need to be developed in line with the new rules, and also the new systems above. So, who pays for this, and how long does it take? While staff work on this, who is looking after the front line?
- Customer service is key in social housing, so you would expect landlords to have to educate their tenants on what Universal Credit is, what impact it will have on them, how the landlord will manage it and help their tenants. Websites need changed to cater for this, information booklets were developed, videos were even made, and again the question is who paid for this? The landlords did.
- Another area that needs looking at is how do you report on it. This could well be managed through the landlords housing and finance systems; however, it is becoming more and more necessary for landlords to seek more advanced reporting/analytics tools, and again this costs more.
Now ask yourself this, with the list above, do you really think the experts went through them all that carefully?
My challenge is for the government to prove they thought of all of this. Go on, someone prove me wrong!
May I suggest that in the future, more consultation is made in the above areas. Perhaps some of the leading vendors should have more participation with the government, perhaps ICT leaders in the sector should be consulted? Perhaps more due diligence in these areas from the experts?
And I would also add that these kind of thoughts and lessons should be applied to any country, and any social housing sector.