CAB concerned about proposed changes to the rules around benefit backdating

In a briefing sent to MPs ahead of Thursday’s debate on Child Poverty in Scotland Citizens Advice Scotland expressed concern about proposed changes to the rules around benefit backdating, and the potential effect this will have on CAB clients.

In addition CAS is calling on the Government to support the Scottish Affair Committee’s call for increased resources to tackle child poverty. In particular the report stressed the importance of simplifying the tax and benefits system and the need for the UK Government to, “do its utmost to improve awareness of entitlements,” (para 62) and “increase the take-up of benefits and tax credits,” (para 23).

The UK Government has announced that, from October 2008 the maximum period of backdating for pension credit, housing benefit and council tax benefit will be reduced from twelve to three months. 

CAS is concerned about the potential effect that this will have on Citizens Advice Bureau clients, particularly in relation to housing benefit. While the Department for Work and Pensions claims that the change is of benefit to customers as it is ‘less financially intrusive’, in reality it offers less choice and increasing hardship.

Customers concerned about financial intrusion can at present choose not to apply for backdating. For those who do choose to apply for backdating, the change will mean increasing financial hardship and even eviction, since many problems are not uncovered or resolved within three months. 

CAS is calling on MPs to write to the Secretary of State James Plaskitt MP and ask him to reconsider the introduction of this policy change, warning that it could impact unfairly on some of the poorest and most vulnerable people in our communities.

Speaking ahead of the debate, CAS Chief Executive Kaliani Lyle said:

“The complexity of the housing benefits system means that many clients are unaware of their proper entitlement and their right of appeal. It is only after unsuccessfully trying to resolve matters for themselves – often for lengthy periods of time – that they come to a bureau, and are able to find out exactly what benefits they are entitled to, and how to access them.

“Last year, over 30% of clients’ problems related to social security benefits and our evidence shows that the 12 month backdating period plays a critical role in bringing about positive outcomes for CAB clients.

“It is particularly ironic that DWP wishes to reduce backdating, given that in the past year, £1,890m of housing benefit and £1,960m of council tax benefit was unclaimed. I hope that the Secretary of State will reconsider these changes in light of the impact that this could have on already vulnerable people and the wider implications that this has in relation to tackling child poverty. If adults are unable to access the benefits they are entitled to, this will inevitably affect the welfare of their children.”

The reduction in benefit backdating will have a detrimental impact on clients with rent arrears who are unaware of their entitlement to housing benefit and vulnerable clients - especially those with literacy problems, mental health issues, language barriers or disabilities.

In addition the changes could impact unfairly on clients whose rent or council tax arrears have accrued as a result of maladministration by the local authority, who will become liable for the portion of these arrears that is more than three months old, even though they are not at fault, and clients applying for a housing benefit backdate is when the local authority has incorrectly applied a non-dependant deduction to their benefit.  This is a common CAB problem and often takes well over three months to identify as an issue, resulting in accrual of significant rent arrears.