Overall Trends and Predictions

·         The proportion of pensioners in poverty has fallen by 17% over the previous two decades.

·         The proportion of working age adults with children in poverty has remained stable, at about 25%, since 1991.

·         The proportion of working age adults without children in poverty has increased from 7% to 20% since 1981.

·         Maidstone ranks 11^th out of 13 districts in Kent for the proportion of houses in poverty.

·         16.2% of households are in poverty in Maidstone. This is estimated to be 9,900 households.

·         15.2% of Maidstone’s children under 16 are living in ‘poverty’.

·         This amounts to 4,250 children.

·         Long term projections show that overall poverty rates will have increased by 2015, including large rises in child poverty, and working age adults without dependent children being in poverty. This is primarily due to out of work benefits being linked to the CPI rate of inflation (and a 1% capped rise for 2013-2014 for all working age benefits, announced since the publication of this report, will also have a significant impact on these figures)

·         The introduction of Universal Credit should lift around 450,000 children out of Poverty, however;

·         Leaving pensioners aside, there is now more in work poverty than out of work poverty.

·         The concerns about Universal Credit have centred on the ability for the IT system to deliver the project. IT systems procured by central government have a poor track record of success.

·         People generally dip in and out of poverty, both in and out of work.

·         Only one in ten claimants of out of work benefits have never worked.

·         Within this number a very large proportion are under 25s, so have had limited opportunities to work due to high levels of youth unemployment.

·         There are 595 young people aged 18-24 claiming Jobseekers Allowance. This is 5% of the youth population.

·         There are 2,220 people in total claiming JSA, 2.2% of the working age population.

·         This means young people make up 27% of JSA claimants in Maidstone.

·         When considering poverty focusing on income alone, at the expense of health, housing or education, can skew priorities or result in too much of a narrow focus.

·         The replacement of Disability Living Allowance with Personal Independence Payment will have a significant impact on the incomes of disabled people, as the government aims to cut the caseload by 20% (and therefore the amount of people claiming).

·         Even with Disability Living Allowance, disabled people are more likely to lack everyday items than other families suggest that Disability Living Allowance may actually be insufficient itself.

·         4,570 people in Maidstone are claiming Employment Support Allowance and related incapacity benefits; 1,060 people are claiming Disability Living Allowance.

·         The proposed welfare reforms, many of which contain lots of small cuts to various benefits and freezes to others, may hit some people several times over. Whilst some may be able to take a small cut in benefit, those who are affected by several cuts at once may find it difficult to cope.

·         Private renters spend the greatest proportion of their income on housing, and the number of people having to claim housing benefit in order to meet their rent payments has increased across the country.

·         In Maidstone, approximately 12,000 people are being supported by the Council through Council Tax Support and Housing Benefit.

·         A study by the Building and Social Housing foundation found that 93% of the rise of housing benefit claimants between 2010-2011 was among working households.

Implications of this Study for Maidstone

·         The commitment by the government to maintain the link between inflation/wages to pension benefits; and the total amount of pensioners in poverty falling is good news for Maidstone due to the aging population.

·         However the predictions for overall poverty levels show a danger that the working age population in Maidstone will come under significant financial pressure over the next two years at least. This could put services delivered by the council under considerable pressure. The most obvious services that will be under pressure will be housing and homelessness services and revenues and benefits, which the council has already started to see.

·         It will be critical that a smooth transition from previous benefit arrangements to Universal Credit is made, to lessen the impact on the borough’s residents.

·         The findings that there are now more in work poverty than out of work poverty, and that most people dip in and out of poverty holds important lessons for the council. These findings mean that it could be an important strategy for the council to support working people who have dipped into poverty to improve their situation and get out of poverty again. The most obvious examples of this could be supporting people into extra training to improve job prospects or supporting parents to get back into the workplace.

·         As the majority of those who are in out of work benefits that have never worked are under 25, it demonstrates the importance of programmes targeting under 25s who are NEET.

·         Even though the level of financial support for disabled people will be maintained or increased when Disability Living Allowance moves over to Personal Independence Payment; there will be a caseload of about 20% of Disability Living Allowance payments who will no longer be supported. This could put extra financial strain on some disabled people who may be deemed ‘not disabled enough’ for Personal Independence Payment, yet not ready for the labour market due to years of being out of work or under employed. There may need to be extra support schemes available for these people for such as:

o   Help to get them back into the labour market;

o   Additional training or education;

o   Advice on what other benefits that could be claimed as an alternative.

·         The council should keep in mind that some people will be faced with several small cuts and freezes in benefit awards simultaneously. This will affect those on out of work benefits most, but will also affect those on in work benefits.

Recommendations