New research: Housing associations’ work to shift the dial and alleviate poverty in communities across Wales
Here, policy and external affairs manager Bethany Howells introduces our new research into how housing associations in Wales are building resilient communities in the face of continuing financial hardship.
The last few years have been difficult for everyone, with rising inflation and increasing costs. But for social housing tenants, who are among those on the lowest incomes, the cost of living crisis has been felt more acutely.
Macro-economics show that the ‘crisis’ may now be abating: inflation has fallen to 2.0% - the Bank of England's target - for the first time since July 2021. At the peak of the crisis (October 2022), it stood at 11.1%.
However, we know in reality, it is still much harder for people to budget effectively, stay on top of bills, and keep food on the table. Food prices rose an unprecedented 30.6% and have not gone back down. Many people are also still struggling with the impact of debt accrued during the crisis - debt that was built up to pay for the basic essentials of life.
Now our new research highlights that the people in Wales who are most at risk of poverty, were struggling before the cost of living crisis began in late 2021. Wales’s poverty levels have remained largely stagnant for the last decade and it has become clear that we need a long-term solution, between multiple organisations and bodies, if we are going to lift people and communities out of poverty (*).
How housing associations are already tackling poverty
Welsh housing associations are anchor institutions in communities across Wales. Already, they play a crucial role in helping people who are facing and experiencing poverty.
They do this through:
Supporting tenants into employment and education opportunities so that they can increase their household income, maximise their potential earnings and become less vulnerable to volatile price increases.
Building and maintaining safe, warm, energy efficient homes so that people are less vulnerable to heating costs.
Going beyond their core purpose of providing homes and making sure tenants’ are living well through delivering a wide-range of health and wellbeing initiatives independently and with partners
Over the last few years, housing associations have shown how quickly they can adapt to the their tenants’ needs. For example, 95% of housing associations created hardship funds (a discretionary fund used by housing officers to help someone experiencing hardship) to respond to the cost of living, and many associations have up-skilled staff so that they can support tenants with the move to Universal Credit.
There is now a strong opportunity for housing associations' ambition to help their tenants can be further unlocked through better partnership working. Specifically, our new report makes the case for better data-sharing arrangements between local authorities, housing associations and the DWP, so housing associations can better allocate resources to those tenants who are desperately in need.
Welsh Government has started its journey towards making Welsh Benefits more accessible, flexible and compassionate. We are wholly supportive of this approach but our report also makes urgent recommendations to improve the Discretionary Assistance Fund (DAF) and how Discretionary Housing Payments (DHPs) are administered in Wales.
The amount that is spent on Individual Assistance Payments (the part of DAF that funds household items for individuals who are struggling) halved in 2024 (compared to 2023). - this is the more preventative element of the grant. Members have raised concerns about the DAF no longer providing cookers, which prevents people from buying and cooking more cost-effectively in bulk.
Our route out of this crisis is through working collectively for the best outcomes for those in need. We have identified three areas Welsh Government should prioritise:
- Strengthen data sharing: Welsh Government should urge the new UK government to revise the Memorandum of Understanding between DWPs and LAs, to allow housing benefit teams within local authorities to share information with social landlords in Wales about who is claiming ESA. This would allow housing associations to take a targeted approach to supporting tenants with transitioning to Universal Credit. Welsh Government should also encourage local authorities to signpost or refer individuals who receive an application for Council Tax Reduction to their housing associations financial well-being teams or other independent debt services.
- Protect funding: Welsh Government must protect the funding of the Discretionary Assistance Fund in their upcoming Draft Budget. The Welsh government should call for reform of Universal Credit to ensure that claimants can pay for basic essentials as a minimum, in line with the Essentials Guarantee campaign steered by the Trussell Trust and Joseph Rowntree Foundation.
- Improve delivery: We would like to see improvements made to the Discretionary Assistance Fund, to ensure that it is fully aligned with the ambitions of the Welsh Benefit’s Charter and can quickly, fairly and reliably provide urgent assistance to those in need. We would also like to see a stronger integration of preventive measures within the Discretionary Assistance Fund (DAF) system.
We urge Welsh Government to conduct a review of the Discretionary Housing Payment (DHP) system in consultation with stakeholders and recipients. This should aim to explore ways to enhance access and effective use of the fund across all local authorities in Wales. A more streamlined and equitable DHP system would help ensure that support reaches those who need it most.
(*) Poverty and Social Exclusion in Wales, Wales Centre for Public Policy, Sept 2022
