Savings, Bank Accounts and Online Benefits. Peter Hughes

Transcription

1 Savings, Bank Accounts and Online Benefits Peter Hughes

2 Welfare Reform The benefits system is changing in Wigan from April 2013 Applications for Universal Credit will have to be made online The Government aim to have 80% of new applications for Universal Credit online by 2017

3 Welfare Reform Universal Credit will eventually replace a number of current working age benefits: Housing Benefit Child Tax Credit Working Tax Credit Income Support Income-related Employment & Support Allowance Income-based Job Seeker s Allowance

4 Welfare Reform How will Universal Credit be paid? Calendar monthly in arrears Backdating will be limited to one month Good Cause for a backdate will be replaced by a statutory list

5 Direct Debits From January we are aiming to make it mandatory to pay by DD Also write to existing tenants Methods of payment - DD, Online, Telephone Payments, Standing Orders

6 Why does it matter to us if a tenant has a bank account or if they are saving money? Just a Landlord?

7 Scenario Couple, many debts so their bank account is overdrawn and hit with charges each month. They always spend what they receive. No savings. They get full Housing Benefit so their rent account is clear. If their washing machine breaks what are their options?

8 Credit Choices Bank loans Doorstep lenders High street retailers Loan sharks Internet lenders / online loans

9 Credit Choices Doorstep Lenders Provident (60% of market share locally) Shopacheck 399% APR on loans Greenwoods- APR on loans typical 433% (APR is shown on their websites)

10 High Street Retailers Bright House, Perfect Home Typical APR 29.9% Very tempting to tenants new plasma, DVD player etc (Culture) Target deprived areas (Company Policy)

11 Log Book Loans Loan Weekly Loan APR Total Amount Repayment Term Repayable 1, wks 437.4% 4,

12 On-line Loans Growing market on-line Websites targeting unemployed Income not considered Able to get a loan into your bank within 20 minutes Very limited (If any) credit checks APR of 1,737%

13 Scenario Back to the scenario. Take out a Provident loan of 500 Pay back in total 950 When couple get down to 100 owing, Provident offer further 500 loan as something else is faulty So what began with a washing machine breaking has led to 1800 in loan repayments, but at least they got a washing machine!

14 Alternatives? Who is out there to save the day????

15 Credit Unions Member owned Provide affordable, competitive credit Allow members to save while they borrow

16 Credit Union Loans Saver Loan(12.7% APR) Borrow 500, repay at p/w, pay back Smart Loan(26.8% APR) Borrow 100, weekly repayment 2.28, repay

17 Credit Union Insurance Free life and loan insurance through CUNA Mutual Insurance Group Life Savings Insurance A claim will be submitted based on the value of the member's savings. The member's beneficiary will receive both the member's savings and a sum from the insurance. Loan Protection Insurance FREE loan protection through CUNA Mutual. In the event of a member's death a claim will be submitted based on the value of the member's loan.

18 Back to the Scenario If Mr and Mrs Bloggs had been saving with a credit union they would have had most of the money for a washing machine saved up already and the loan offered by the credit union would have had less interest and less to pay back. Happy Days!

19 Bank Accounts Many of our customers can t access or don t try to access a bank account Many are afraid of the consequences of missed Direct Debits, going overdrawn or charges in general Those customers that do have bank accounts often struggle to stay in credit and are regularly overdrawn.

20 Basic Bank Accounts Set up through a government scheme Accessible for (almost) all Pay in wages / benefits and any other income Set up Standing Orders and Direct Debits Receive a cash card to withdraw money Can t go overdrawn there are still charges for missed Direct Debits

21 Jam Jar Accounts A further alternative to standard bank accounts The account is divided in to Pots (jars) Eg spending, bills, saving

22 The Alternative? Post Office accounts : - No Direct Debit available on most accounts - No card available - Costs the company money if people pay at the Post Office.

23 What can YOU do? Warn tenants off high interest lenders Advise of credit unions Promote basic bank accounts and jam jar accounts

24 Want to Know More? m/banking/basic-bank-accounts anking/basic-bank-accounts/ m/current-accounts/basic-bankaccounts/

25 Getting On-line The Benefits

26 Facts & Figures An estimated 8.2m people do not have access to the internet Almost half of these (4m) are social housing tenants

27 Facts & Figures Home access to computers for children can improve educational performance It s estimated that between 75% and 90% of jobs require computer use Offline households are missing out on estimated savings of 560 per year from shopping and paying bills online*

28 Education & Life Chances Homework Online Greater access to different resources Children from Online Families are likely to have greater lifetime earnings

29 Employment and Skills Being online provides people with greater opportunity to search for jobs Access to learning online training courses Applying for benefits

30 Saving Money Paying bills rent Searching cheaper services eg Gas and Electricity Online banking watch money Ebay buying and selling items Freecycle

31 Social Media Facebook Twitter What s going on where you live Building Communities

32 Getting Tenants Online Learning workshops Community Events (Spring On Line) Promote cheap access computer/broadband Digital Hubs

33 Case Study Solihull Community Housing has recently made an exciting step in meeting the Digital Britain and Broadband for All initiatives by reaching out to their customers. The organisation has installed free wireless broadband access and free, reconditioned computers to tenants Improving education and recreational opportunities

34 Local library Life Centres Places to get Online Internet cafés Family and friends Community centres (Green Grass Project)

35 Using Online Calculators

36 Online Calculators Available Housing Benefit Benefit Cap Under Occupancy Tax Credits and other benefits (to maximise tenants income) Energy/money saving calculators

37 Benefits of Online Calculators Ability to agree rent payments Advise of implications regarding Welfare Reforms Advise on what benefits tenants are entitled to Help tenants to access cheaper services

38 Housing Benefit Entitlement Quick Calc, Victoria Forms, Turn to us To calculate you will need to know: Hours worked Gross income Any benefits received Household income Any non dependant s income Savings

39 Benefit Cap Calculations Directgov website Calculates how much Housing Benefit could be reduced by if tenants exceed the level of the Benefit Cap To calculate will need to know: Income details of all people in household

40 Under Occupancy Calculator UCnotes website (WALH currently having trial period on this) Calculates if tenants affected and by how much To complete will need to know: Household composition Number of bedrooms Weekly rental charge

41 Calculating Other Entitlement HMRC Tax Credits calculator Directgov Tax credits calculator (takes you to HMRC) Turn2Us will calculate all benefits To complete will need to know: Household composition Details of income of people in the household Details of any benefits being claimed, or just stopped claiming Working hours The average amount spent each week on childcare

42 Energy Saving Calculators My Home energy switch Searches for cheaper gas & electric suppliers and calculates costs/savings. They will deal with switching suppliers on behalf of the customer To complete will need to know: Current supplier Current usage or costs

43 Energy Saving Calculators United Utilities Gas & electricity provider websites United Utilities have a calculator for predicting if a water meter would save customers money Utility providers have calculators to get quotes and compare tariffs To calculate you will need to know: Current tariff Current usage This information can be taken from the tenant s most recent bill

44 Accuracy Accurate income and expenditure details are needed to get the correct result. Tenants need to be advised that the outcome is based on what they have declared

45 Any Questions?

46 ..and TEST!