4) Management Support -Welfare Reform & Universal Credit for social enterprises and charities.


The continued reduction in public spending challenges to everyone living in both the rural and urban environment.Welfare Reform is both a major threat and significant opportunity. For charities or social enterprises it comes on the back of significant reductions in both income donations and statutory funding.

It should not be forgotten that two thirds of people in receipt of benefits are actually in work often in low paid or seasonal employment.  In some charities the rental or charges for services income stream will be reduced as Housing Benefit and rent level changes impact. In addition people on limited income will `rob peter to pay paul` and make detrimental choices on spending.

Both social enterprises and charities will need to take a double sided view looking at both the impact upon people who use the services and the impact upon the organisation. Most of all charities and social enterprises will have to become more proactive in helping shaping the choices people on benefits receive.

People first

Both training and support will be required to assist millions of people to manage their finances in preparation for the implementation of Universal Credit and associated welfare reforms between 2013-17 and beyond. It makes good business sense for social enterprises , social landlords, care providors,charities and other services to `map` which customers are worse affected and assess the impact upon their business. It also makes sense for all service providors to recognise that preventation is better than cure and substantial costs savings can be achieved by minor investment in training and support for people to increase their knowledge and capabilities.

There are also large numbers of vulnerable marginalised people within the general population who are only accessing the basic services.These groups are often forgotten until problems occur and then action follows sometimes detrimental to the individuals and costly to organisations. For company`s that provide for higher need groups it is worth noting that people in sheltered or supported housing may become vulnerable to the changes in future reviews post 2017.

There are still many grey areas since the government published in Feb 2013 `Universal Credit- Local Suport Services Framework`. In the housing sector large numbers of people will have to learn budgetting skills if service providors arrears are not to rise dramatically. In the Care sector the roll -out of Personel  Budgets will give people further choices but needs will have to be met from less money available etc.

The range of changes under the welfare reform agenda are detailed below:-

From April 2013 local councils may reduce above for people of working age who claim this benefit.

UNIVERSAL CREDIT-UC will be rolled out between 2013-17. First will be new claimants with existing migrating within the period. UC will be paid monthly as a single paymentand include Housing Benefit.
-It replaces Housing Benefit,Working Tax Credit, Child Tax Credit,Income Support, Income based Job Seekers Allowance,and Income related Employment and Support Allowance.
-It does not include Disability Living Allowance or Career`s Allowances.

The government in 2015 proposed then abolished a £2.4 billion reduction in Working Family Tax credit on the grounds that the new UC system would address the `problem`.

In April 2013 all benefits were set at a maximum of £500pw for single parents,couples with /without children or £350pw for single people without childen.
-It does not apply if a member of the household get Pension Credit or Working Tax Credit, claim Disability Living Allowance,Industrial Injury Benefit,or the Support Element of the Employment Support Allowance.

In the 2015 budget the Benefit Cap was reduced to £23K in London and £20k outside alongside a range of other changes in accordance with the Government`s 2015 May Manifesto committment.


The government have introduced `sub-market` rents, reductions in security of tenure; `pay to stay` for thoes on higher incomes in social housing; flexible` local allocation policies in order to engender greater mobility and link to work; and in 2016 limited rents to Local Housing Allowances etc. From April 2013 people who live in social housing and have a `spare` room may have their housing benefit reduced. These changes do not include one bed flats/bedsits,if household receives pension credit (61yrs 6mths),are approved foster carers,member of family in HM Forces,or require extra bedroom for disabled child.

Services transformed.

The changes will go on. So what will all the changes mean for your services ? Are you fully prepared ? Do you need assistence with mapping out the impacts,devising responses and changing your organisation so it becomes stronger ?

The combined impact across the social enterprise and charitable sector will be significant with some organisation overwhelmed by increased demand for services, others face further income reductions, whilst some will have to re-think their business model to survive. Some may decide to merge or change services completely. What ever your choices we are here to help.

Cara Community Services has staf experienced in training and working with vulnerable groups and would be happy to discuss your needs and devise a suitable programme to help smooth the transition to the new welfare agenda.

It costs nothing to talk to us. Our conversations are in the strictest confidence and covered by both our confidentiality agreement & Terms of Business as displayed on this website.Please call John Brennan on 01803852270 or email john@caracommunity.co.uk.