Welfare Reform and the rent cut have changed how social landlords operate, they need to do more with less. According to Garry Croll, Assistant-Director of Housing at social landlord Liverpool Mutual Homes.
“The Government’s welfare reform programme is driving social landlords to consider new ways of working, including in a more agile way.”
Those landlords looking for new ways of working are investing in technology that is helping mitigate welfare reforms and protecting their revenue streams as well as supporting a more flexible approach. Liverpool Mutual Homes recently deployed a cloud based predictive analytical tool, called RentSense, as Croll explains.
“The RentSense system supports mobile and agile working that in turn has also helped deliver operational efficiencies to the organisation.”
However, for many Universal Credit is the biggest challenge, as Maggie Cornall, Director of Operations at Blackpool Costal Housing explains.
“The threats posed by Welfare Reform are a high strategic priority for us as an organisation. Universal Credit roll out is still in the early stages within the Blackpool area and the sooner we could start to mitigate against the risks to our income as roll out progresses the better.”
Unlike some reforms, Universal Credit is and will impact all landlords across the country. Already City West Housing Trust and Bolton at Home have found that supporting tenants on UC costs 400%* and 500%** more respectively than legacy benefits. What’s more the transition to this new benefit is also affecting landlords’ residents, as Vincent Thomas, Interim Assistant Director of Income & Legal Operations, at One Housing explains.
“Based on pilot projects run around the country we expect the transition (to UC) to have a dramatic impact on our ability to collect rent from people on benefits. The pilots showed a long term impact on collection rates (-3.6%), but perhaps more importantly a fall in collection of more than 30% in the short term as people get used to their new responsibilities.”
Both Blackpool and One Housing have also invested in RentSense and according to Thomas.
“RentSense is a key part of our mitigation strategy to maintain our collection rates in both the short and longer terms.”
Blackpool too were keen to protect their revenue streams from Universal Credit, as Cornall highlights. “We already have high performance in income management but were keen to try to future proof our income.”
For social housing landlords welfare reforms are just part of the problem as many landlords have gone through restructuring programmes in response to the Government’s 1% rent cut, and as Thomas, from One Housing, describes more is needed to be done with less resource.
“The rent cuts mean that we have to become more efficient, delivering improving services at lower cost. They make it more important that what we do charge is collected.”
So many landlords are using and investing in new technological tools to protect revenues from a changing environment and deliver efficiencies. And those not investing or improving income collection processes and systems will find that their revenues are at increased risk. As Thomas points out One Housing’s approach.
“Now is the time to make sure our collection service is fit for purpose so we’re ready to take on the new challenges ahead.”