 Good morning, everyone. Welcome to the meeting of 2019 of the Social Security Committee. I remind everyone to turn off mobile phones or other devices to silent so that they do not disrupt the meeting. We have got apologies this morning from Pauli McNeill and Shona Robison who unfortunately can't make it here this morning, and agenda item 1 is decision on taking items in private. The committee has asked to take item 4. Consideration of evidence during this meeting this morning in private. Is that agreed? We now move to agenda item 2, social security support for housing. This is the penultimate evidence session of the committee's inquiry into social security support for housing. In this week's session, it is comprised of two panels, and I can now welcome our first panel this morning, and that is Bethred Singer policy officer from Crisis and Ashley Campbell policy and practice manager, Charter Institute of Housing Scotland. Thank you both three for coming along this morning. Good morning to you. I will move straight to questions. I have a first question from Keith Brown, MSP. Thank you very much for coming along. I just noticed in the evidence that you provided that you both have real concerns about the freeze on LHA rates. I think that the freeze should be lifted by media effect and revised to be brought in line with the actual cost of renting. I just for the volumes of doubt completely agree with that. On the other side, is one of the concerns that the lifting of the freeze would in turn lead to inflationary pressures within the housing market? Am I right or wrong to think of it as a little bit analogous to London waiting, where London waiting itself starts to stoke up prices and costs of living as well, but is we interested in your views on that? We have done some analysis looking at the affordability of properties within the LHA rate across Scotland. We found that, in 15 out of 18 of the different areas in Scotland, there is a monthly shortfall between the amount of LHA that you can get and the amount of money that LHA tenants will receive. There is already a big gap there. In terms of whether that will put rents up, we are already looking at the bottom end of the market. We are recommending that you raise back up to the 30th percentile. I do not think that there is going to be a huge amount of pressure rising up all the way through the market. If you are looking somewhere like Lothian where there is huge pressures in the market already and the rents are rising quite quickly, there are lots of other issues that are pushing that up. LHA would just be a very small component of that. If you are looking at things such as Airbnb, for example, I think that that is having a big impact on the rents within the Lothian area in particular. In our evidence as well, we highlighted the shortfalls between LHA and the 30th percentile. As Bess said, that is still looking at the very bottom of the market. That is not looking at the market as a whole. I think that the other point that is worth making is that one of the justifications of the reasons around the freeze being introduced was to dampen down the market. The idea being that an LHA cap or an LHA freeze would help to keep rents more affordable. We know that that has not been the case. The Scottish Government's own statistics on rent in the private rented sector released last year and showed that between 2010 and 2018 there was a cumulative increase in the rent for two-bedroom home, which is the most common size of home in the private rented sector. The increase was 21.6%. The largest increase was in four-bedroom homes, which was 33.3%. That is compared to CPI over the period of 18.7%. We are seeing that rents are increasing over and above inflation anyway, regardless of the freeze being in place. It is also important to note that that increase is not even across the whole private rented sector. Of course, there are areas where it is increasing a lot faster. As you mentioned, Esmbro is a particular hotspot. There are also other areas in the private rented sector where rents are going down, probably most notably Aberdeen and Shire. Obviously, there was the decline in the oil industry. The rents in Aberdeen and Shire have gone down in recent years, and it shows that the market is quite volatile. That is not being reflected in LHA. I am interested in a lot of the evidence sessions that we have had. The situation in Edinburgh becomes the one that everyone mentions, but there is obviously a big world out there out with Edinburgh, including my constituency. It is sometimes difficult to work out with the impact of those things elsewhere. However, I think that other members will be asking about the supply of private rented housing for recipients of benefit. I wonder whether you think that the lifting of the LHA cap would in turn lead to a better supply of private sector rented housing. I think that it would certainly lead to better access for people who are claiming benefits. Within our evidence, we talked about the financial shortfall, but we also looked at the proportion of the market that would be available to people who are claiming benefits. I think that if the LHA cap was lifted and if LHA was reinstated at the 30th per centile, or ideally maybe even the 50th per centile, which is what it was before it was reduced in the first place, that would open up a lot more of the market to people who are claiming benefits. It would also give a lot more certainty to landlords that their tenants were able to cover the rent. We did some analysis in the wider Inverness region. We looked at 212 properties there. Within that, four properties were available within LHA rates. One of those was at Caravan, which we would not particularly consider a settled accommodation, but that was what was available if people went on to top-up their LHA through their own incomes by 20 per cent. They could access it. I think that it was another 19 properties. The other issue that you have got alongside that, though, that we came across about just under half of those properties advertised were saying things like no DSS or no housing benefits. I think that there is a wide range of issues around access, including reluctance to let people on benefits for a range of reasons. However, it would certainly improve access if LHA rates were able to meet more of the market rents. We have heard quite a bit of evidence in and around the committee on the issue of rent arrears, and particularly the different views that exist about whether the introduction of universal credit has had an impact on that. I am keen to have your take on whether you see a connection between the two things. We work across Scotland, but we have specific homelessness services in Lothian and in East Lothian. We are certainly finding that in both of those areas landlords are much more reluctant to rent to people who are on benefits. There is a real concern about that. We have been told in East Lothian that supported accommodation providers there will not rent to anybody with any sort of rent arrears no matter what the cause of that, whether that is benefits or anything else. That is a real issue for many of the people that we work with. Do you see a connection per se between the role of universal credit and the fact that some people—I am thinking perhaps of the fact that there is, of course, the five-week? It is not unique to universal credit. I appreciate that it has been the case with other benefits, but there is the five-week wait-down period to get the first payment. Does that have an impact on rent arrears? We have a lot of anecdotal evidence that we have done surveys with local authorities and with rent deposit guarantees schemes across Scotland. They are making a lot of connections between welfare reforms and finding it more difficult to use the private rented sectors and finding increases in homelessness. We do not have direct evidence to say that the rent arrears coming out of universal credit are causing that, but that is certainly what local authorities are implying to us and what rent deposit guarantees schemes are saying as well. As you said, you have already heard in the committee that there is an awful lot of evidence from the social rented sector about the increase in rent arrears that is being linked with universal credit. You have probably also heard that some of those might be technical arrears and might be to do with delays and benefits. It is that first five-week waiting period that local authorities and registered social landlords are working with tenants to make up those rent arrears, but there is a backlog that is causing issues with rental income and their business plans. There are real issues for social landlords. There is probably less evidence in the private rented sector, but because of the way private landlords' businesses are run, there may be less scope for them to be able to deal with those delays and the payments coming through. The vast majority of private landlords have one or two homes that might not even be their first or only job. It is much more difficult for them to be able to deal with those large gaps in payments, particularly at the beginning of a claim, and for them to be able to support a tenant through that is a lot more difficult than for a social landlord who is set up with the support mechanisms in place and with a lot more staff to help the tenant through that claim. Is it your view that, in that case, the difficulties are described and that we should have as a default position that the rent is paid to the landlord rather than the individual? I appreciate that there are now flexibilities around that, but is that something that you feel should be the default position? I think that that is quite a complex question, and I do not think that it is quite as simple as the rent being paid by default to the tenant or to the landlord in every single case. The chartered institute of housing's position on direct payments was that tenants should be given the choice. Obviously, the Scottish Government has implemented Scottish choices and claimants are now being given the option to have those payments made direct to their landlord if they want to. I think that the committee has probably heard already that there are issues with how those choices are being implemented, so if a claimant decides to have their payment made directly to their landlord, that is not happening necessarily on the first payment, or if there is an issue or a delay, it is maybe not happening on the second or even the third payment. That is not an issue with the choice itself, but with the way in which that is being administered. I think that there are issues of principle should a person have the right to choose or not. There are also practical issues as well, with payments being made directly to landlords. There are several issues with that, so we have talked about administrative issue of payments not being made from the first payment after the choice is made. There are issues with a delay in direct payments being made. For example, if a claimant receives their universal credit on a date to say today the 25th, and they have decided to have their housing payment paid directly to their landlord, that is not necessarily made on the same day. The housing element is removed and held separately. That is paid to landlords in bulk on a four-weekly cycle. If that four-weekly cycle has just been missed, say the four-weekly cycle, happened yesterday, my universal credit claim comes through today, my rent does not go to my landlord for another four weeks. That in itself is an issue. I think that the DWP is aware of that, and they are working to rectify that. Again, that is not an issue with the choice, that is an issue with the administration of the system. The other complication is that looking at whether a payment should be made directly or not is quite a simplified way of looking at it. A lot of people might say that tenants do not want to have the responsibility or they want the peace of mind that their rent is being paid direct to their landlord and they do not have to worry about that, and that is fine. That might work where a tenant is being paid full housing benefit or full housing costs. There are a lot of cases where tenants are being paid partial benefit or where they have fluctuating wages. Their universal credit claim might change from one month to the next, so direct payment might pay part of the rent to the landlord, but they would still then need to see how much was left over and pay that themselves out of other income. It is not quite as simple. I do not think that it is saying that in 100 per cent of cases it should be paid direct to the landlord or that it should always be paid directly to the tenant. I think that it is more complex than that. Can I move just follow-up a little bit of that? I was looking at a submission that we had from COSLA and they have been gathering data quite systematically, as much as possible, in relation to rent-a-rears and where the link may be to universal credit roll-out. They looked at the local authorities where it went live earliest, that roll-out East Lothian, Highland, Inverclyde, East Lombardshire and Mid Lothian. I will remove Inverclyde from that for a moment, because they do not really have their own housing stock. In the two years from 31 March 2016, it was estimated that rent-a-rears increased by 26 per cent. I would say that COSLA are not clear how much of that is attributed to universal credit, but they believe that it is a significant and major amount. They put a figure on that of £5.7 million for Inverclyde, the largest social housing provider in Inverclyde homes. In a similar period of time, I think about two and a half years, it was a 35 per cent increase in rent-a-rears so that that is a gap in financing to local authorities and to social housing. I think that you will appreciate that that is a significant issue for their cash flow and repairs and maintenance in their own business plans for all tenants, including the ones that are on universal credit. They estimated that that is about a bit less than 10 per cent of the population of Scotland, so it is a very rough calculation, but that could be £57 million or so in a couple of years period and not being used. There are significant issues in relation to rent-a-rears, so I am sure that you will recognise that, but I suppose that my question would be I am all about choices. Mr Griffin should name check him. He has quite acidiously argued at this point as well at the committee. If the default position was that the money is going to go to the landlord with all imperfections that exist at Ashley Campbell pointed out quite rightly, it would certainly address a lot of those revenue and rent-a-rears issues, and then it is about that empowering choice to say, well actually I am going to take control of all the monies given to me for myself. That would certainly give comfort to maybe vulnerable households that do not even identify themselves as vulnerable households and still empower households where that vulnerability does not exist to take control of all of their own finances. When we are talking about not being as straightforward as you suggest Ashley Campbell, I am just wondering if the start position could be the money goes to the landlord with all the issues around that and understand that, and then we looked, the Scottish choice could be you can take control of your own money if you wish. I am just wondering some thoughts around that and the issue of rent-a-rears for local authorities and housing associations. I certainly agree that there are significant issues with rent-a-rears for the social rented sector. As I said and you have pointed out, there is an awful lot of evidence to support that. It is not just a case of chasing up those rents, it is a case of the knock-on effects that that has on business plans, on local authority and RSL's ability to support other tenants, their ability to build more affordable homes. There are wide-reaching implications for those rent-a-rears and as you said they are very significant. I think on the question of whether the rent could be paid to the landlord by default and then the choice to have that switch back to the tenant, I do not have any particular issue with that. Thank you for that, Bethrae. Do you have any views on that? Given everything that Ashley said, we do not have an issue with doing that either. It may well make sense, but it is important to make sure that there is choice for the tenant in there. Whether it goes directly to the landlord or directly to the tenant as the first point is certainly a good question to be exploring. To pick up on the issues of rent-a-rears and freezes to local housing, allowing some tenants in Scotland their way of getting round that have been discussing housing payments to top up, to cover that gap between LHRE and actual rent. Do you have any views on how successfully or not, or how difficult or not, it has been for tenants to access discretionary housing payments to make up that shortfall? I think that we certainly welcome the use of discretionary housing payments to support people with their housing payments. We have seen through mitigation of the bedroom tax that that has been very successful. It is not the ideal way to make that payment, and the Scottish Government knows that. We are working with the DWP to make sure that that payment can be made directly through a top-up to universal credit rather than going through discretionary housing payments. The issue with using discretionary housing payments to cover shortfalls like LHA is that the very nature of discretionary housing payments is that they are supposed to be discretionary and short-term. They are not guaranteed. It is being used as a vehicle to mitigate the bedroom tax because that was all that was available at the time. I think that our preference would certainly be for local housing allowance to be increased rather than to use discretionary housing payments as a long-term fix for something that we know is not covering the basic cost of housing for people. The majority of the DWP in Scotland is going on bedroom taxes, as Ashlee says, and to some extent on benefit caps. There is only about £10 million of DHPs, which is available for other purposes, such as LHA rates. The budget is something like £40 million or £50 million overall, so it is quite a small proportion of that that is available for things like topping up LHA. We would also like to see DHPs used more widely as a homelessness prevention tool, so that might be the topping up LHA rates. Sometimes that is things like rent in advance and things like that. We are increasingly seeing demand for rent in advance from social landlords and others. DHPs are not used terribly widely for topping up LHA because the majority of it is being spent on bedroom tax and benefit cap, but it would also be useful to look at whether we can use DHPs and other funds that are available to the Scottish Government more generally as a homelessness prevention tool and look at that as a more holistic approach to supporting homelessness prevention. We heard everyone from Edinburgh City Council that they said that they had some difficulty in getting people to apply who would be eligible for a discretionary housing payment to support them meeting their rent commitment and that they were offering awards on an annual basis to cover shortfalls. That seems to me to be a more generous provision than I am aware of elsewhere. I do not know if you are aware of any variation across 32 local authorities as to how generous or not the provision of DHPs has been. It is not something that we have looked at in a great deal. The majority of our members are based in Edinburgh, so that is the system that we are most familiar with. I know that the council highlighted that they have issues with people applying, and we would encourage our clients to apply for DHPs and support them to do that. That is not something that we would see through our client-based services. You spoke about how discretionary housing payments could be better used to prevent homelessness. For example, just now, local authorities are relying on guidance from the DWP as to how they administer and allocate the funds that they have at discretion. Do you think that the Scottish Government should issue new guidance to support local authorities in giving a more uniform approach to support people across the country now that they have the power under the new social security act? My understanding is that guidance is force coming. Do you know more about that to me? My understanding was that the Scottish Government was going to be looking at developing their own guidance. It is an opportunity to look at the way that we are using DHPs here and to maybe clarify what they could or should be used for. As Beth pointed out, the majority of DHP funding is being used to mitigate the bedroom tax. I understand that additional funding was put into the DHP pot for that very purpose. Some of the feedback that we have had from members is that it would be useful to take that out again. As I said before, the Scottish Government is looking at paying for the bedroom tax directly for universal credit, and that would certainly be helpful in cutting down on the need for DHP applications in making sure that people have an entitlement to that payment rather than a discretionary payment being made on their behalf. In a bit of transparency, as Beth said, it looks like a big pot of money, but when you take out the amount that has been allocated to the bedroom tax or to the benefit cap or other welfare reform measures, there is not a lot of money left, so even just having that transparency would be useful. It is also worth noting that discretionary housing payments are never intended to be used specifically or only to cover welfare reform measures. There are wider uses that could be made of discretionary housing payment to support people who are at risk of homelessness, and that could be clarified through guidance for local authorities if that was developed by the Scottish Government. There is a lot of work going on around ending homelessness through the Ending Homelessness Together Action Plan. One of the things that we would like to see is better—well, there will be more work within that about developing duties around preventing homelessness in Scotland. We have similar duties in Wales and England now, and I think that DHP is potentially the Scottish Welfare Fund and also looking at the work that rent deposit guarantees schemes and private rented sector access schemes do around Scotland in terms of providing bonds and that kind of thing to help pay for deposits and rent advance. All of that could be joined up, and I think that it would be really good to do that as part of the preventing homelessness work, but make sure that DHP guidance and future guidance on how the Scottish Welfare Fund works could be joined up really effectively potentially to make sure that there is a good independent for some of that work and really get that kind of cross-government and joined up working going on. Can I just follow up a little bit of DHPs now? Again, COSLA were advising us about restrictions on how quickly local authorities or housing associations could move to identify where DHPs could be applied. I will just maybe quote from their submission, as local authorities are not advised by the DWP of tenants or claimants whose payments have been reduced by the application of either the bedroom tax or the benefit cap in universal credit cases and could only provide such support when claimants come forward even when support is in offer. COSLA has previously raised with DWP—we will chat with DWP later this morning in an evidence session—whether they could share information in such cases with local authorities. We believe that they have the power to do for the purpose of welfare assistance, but today that is not prioritised by DWP. In terms of information sharing and the quick and speedy application of discretionary housing payments, is there more that has to be done in terms of that information sharing? Is that something that you are aware of or that COSLA has raised with us? I think that that would certainly be helpful. I have not heard specifically of that being an issue in relation to DHPs, but it certainly being an issue in relation to social landlords being able to identify people that need support so that I guess this is just another circumstance in which people may need support and local authorities or RSLs might be in a position to be able to provide that support if they had that information from the DWP. I know that feedback from our members is suggesting that social landlords certainly have much better communication channels with the DWP now. They have been working for a number of years on this. Obviously, they have trusted partner status and the landlord portal, which has been really useful, but I think that there is still some way to go. It is not an issue that we have come across, but given that DHPs and housing benefit used to be all administered by the local authority and now that is being split up, it makes sense that those communication issues are maybe not as strong as they were previously. Okay, so it could be an emerging issue, but thank you for responding to that. Alison Johnson. Thank you very much. I would just like to touch on the crisis submission that says that analysis of the experiences of 1,000 homeless people in the welfare system found that one-fifth, 21 per cent, if people became homeless because of a sanction and 16 per cent had to sleep rough, so those are clearly very shocking figures. I would like to ask whether those are UK figures or specific to Scotland. They are from across Britain. We might expect a Scottish proportion. Yeah, and certainly in our skylight work with clients who have been, who are or have been, homelessness, it's something that we come across. We've been working with a guy recently, for example, who has had three consecutive sanctions, partly as a result of what the first one came about because he was asked to move his mobile home and by the police and therefore missed a job centre appointment. They then rearranged the appointment through his online journal, but he didn't have access to that because he was in a very rural area and didn't have access to a mobile phone or to internet. He's been five months without money. We have put in a mandatory reconsideration for him, but that's taking 120 days at the moment to process. I think he's now got his money, but he will be repaying hardship payments out of that. He's been offered temporary accommodation, but he's been offered permanent accommodation, but he's going to struggle to take that up because he's going to struggle to pay rent in advance. He's going to struggle to pay for his gases, heating and so on. It's certainly something that is a real challenge for some of the people we work with. Is it the position of crisis and the chartered institute that sanctions are a driver of homelessness? The evidence that you've quoted that we commissioned, I think that was from Sheffield Hallamory University, shows that we would like to see that there should be much more clarity about what's going on for people before a sanction is imposed on somebody so that sanctions aren't imposed in situations that will cause homelessness. I noticed that crisis is working with five Edinburgh job centres to raise awareness of homelessness among staff. Obviously, if we make someone homeless, there are societal costs. It's not money-saving exercises in terms of the person's health, their impact and their ability to gain employment and so on. This is a really drastic step. I just wondered if you could tell us a bit more about this. How did that partnership come to be? Why was it thought that it was necessary and what's coming out of it? It's come about over a few years of working with the job centres. I would say that some of that came initially about through personal relationships and building contacts there. There was somebody in one of the job centres in Edinburgh who'd had working in the job centre but who'd had personal experience of homelessness himself. It came about through those. We've been doing joint team meetings and going in and doing training together. We've seen really positive results from that. We've seen a much greater understanding of people's situations, checking in with people about whether they're homeless or are they just worried about their housing situation and discovering that there's a lot of anxiety for a lot of people about their housing. If they're concerned about the stability of their housing, then looking for jobs on top of that is really quite a challenge. The sorts of things that have been going on are changes to the claimant commitments so that it's reflecting more of the wider issues that they're facing and maybe reducing some of the work search requirements and so on. We've found it a really positive experience. In terms of sanctions in particular, we seem to have seen a reduction in the number of sanctions that our members have been getting. We think that's because there's more realistic work search requirements on those claimants. It's been really positive. It's something that we've been doing in some other parts of Britain as well, so we've done some work like that in Coventry and also in Newcastle. We've been working with the job centre in terms of developing a module around homelessness, helping train—the module will go to help job centre advisers understand homelessness better. I think that's going through at the moment and that's at a GB level. There's going to be specific points of contact within job centres around homelessness and that's beginning to come in at the moment. We hope that that will make a real positive difference for people who are homeless. It sounds very positive, particularly if it's having an impact on lessening the number of sanctions and so on that are applied. We know about Edinburgh and now Coventry, so do you think that this is a model that has potential? Obviously, I appreciate that crisis. Your resources aren't unlimited, but is this a model that could be rolled out by the DWP more widely across the UK in some shape or form? I think that having the specific points of contact within job centres is really useful. We need to make sure that there are people within perhaps every region or in clusters of job centres who have actually even greater in-depth understanding of homelessness so that there can maybe be a point of advice and so on. We have 11 skylights around Britain, so there's a limit in terms of what we can do, but I think that improved partnership working with other homelessness organisations can make a real difference. I know that Homeless Action Scotland did work in every job centre in Scotland a few years ago, looking at the homelessness easement and applying that more effectively. I think that there needs to be an on-going process of training and support and making sure that those skill levels are constantly maintained, especially if the staff turn over and so on. I think that there are real positives that can be gained if we work well together and if there's a good understanding of people's housing situations within job centres and within the specific details of people's claimant commitments. Can I ask my Conservative colleagues what they want to come in at any point? Michelle Ballantyne? I'd be interested—good morning, sorry—at what you have to say. She's been really interesting this morning, and I'd be interested in exploring a little bit more around that, because it sounds like the system allows the necessary changes to make things work on the ground. How difficult has that been in terms of getting those changes to get positive support around homelessness? I think that it originated in some particular contacts, and I think that those individual relationships can make or break. I think that it's really positive that there's now this policy coming in of having these particular points of contact within job centres. I think that there does need to be a higher level of expertise in addition to that to make sure that there is that accessible to job coaches. I think that there is the possibility in the system to do that. I think that some of the other issues that have been talked about in terms of the administration of the system and some of the complexity of the system do cause a different type of barrier, which still makes a huge difference for whether people get the right entitlement. There's an issue around making sure that the work search criteria are right and people are getting the right support to do that and not getting sanctioned inappropriately, but then there's also the wider issue about making sure that people are getting the right money at the right time and getting sufficient money that they can afford housing in their area. On that note, going back to the LHA rates, which are the backbone of some of this issue in terms of ensuring that the levels of available benefit to someone will match the availability of rental accommodation, the LHA rate is obviously set at that sort of percentile, but as you've pointed out earlier, markets are fluctuating around that. How responsive have you seen the LHA rates being? I mean, it is how often are they changed in response to movements in the markets because obviously the markets on a demand and supply basis before it indicated summer going up rapidly as a repolt of demand or removal of opportunity with things like Airbnb, but where something goes down, do they stay up or do they get taken down? What's your experience of that? LHA rates used to be in line with the market and then they were reduced to increasing at CPI levels and for the last three years, four years, they've been frozen altogether, so they haven't changed at all. That's why we're seeing such a big gap between the 30th percentile which is what you should be able to afford and in a lot of Scotland we're seeing that halved, so people are only able to access 15 percent of the market and they're obviously competing with everybody else looking for the cheapest accommodation in the market as well, whether they're on benefits or not, so LHA rates aren't reflecting the market at the moment and that's one of our kind of key reasons for recommending that. Prior to the fees, did they move routinely, monthly, yearly? I think it was yearly basis prior to that. There was annual change to them, but the way that that's calculated is so in Scotland, it's rent service Scotland will go and do an evaluation of the market and they'll take a sample of the local area. Sometimes those samples are very small, so particularly around the shared accommodation rate, they come extremely small, so just because there isn't much shared accommodation around, so if they take a very small sample, it means that from year to year the rate can change quite a lot, because if you've got an extra three flats of shared accommodation rate compared to the previous year and they're a bit higher then, that will alter the rate quite a lot. One of the things that we want to see is using the Scottish Landlords register so that Scottish Government would automatically get that information from landlords about what the size of the property is and what the rents are and then you could use that and you'd have a much better basis for setting LHA rates. Okay, so to get that as feedback, that's very interesting, thank you. Just to add to that, as Beth has said, the way that rental information is collected could be improved on so we could have a lot more detailed information about local rents. I think another issue with local housing allowance is that it's based on very broad markets. As you know, even within Edinburgh you can go one street down the road and the rents will be completely different. The broad rental market area for Edinburgh is Dallodians. It's a massive geographical area and there's a lot of variation within that, so LHA is quite a blunt measure of the price. As Beth said as well, we're in year three of the LHA freeze, so LHAs are still revised every year but they're not going up. They can still go down, so when rents are going down in a particular area the LHA might go down, it can't go back up again because there's a freeze. The way it's set out just now is in favour of LHAs coming down and then not going back up again. In terms of the use of DHP and being used around mitigating bedroom tax etc, for people in private rented accommodation there was no spare room subsidy. Are you seeing the stress there? As I understand from some crisis reports, it's really from the private rented sector that homelessness is increasing. The social rented sector seems to be more stable in that sense. What are your thoughts about the pressures there in terms of—I'm assuming that there's the same issues around size of accommodation availability etc? I think there is a difference. Just to clarify that, in terms of homelessness there is a major pressure, particularly in England, of homelessness being coming from the private rented sector. We don't see that so much in Scotland. The biggest cause of homelessness in Scotland is relationship breakdown. We did some research, we did a commission survey for the homelessness monitor and that found about 37 per cent of Scottish local authorities were saying that they were seeing homelessness increase around the private rented sector, so it certainly is an issue in some places but not everywhere. In terms of the pressures, I think there's a difference in the type of accommodation you get in the private rented sector compared to the social rented sector, so a lot of social rented sector accommodation has been built to accommodate families, whereas you get a wider range of properties in the private rented sector. There is more flexibility. That's why we see it as one—for some people—a really good route out of homelessness and preventing homelessness as well, because there is flexibility in terms of location, in terms of size and so on. It can be a really useful route out. We aren't seeing the pressures that we've been seeing in England in terms of generating homelessness, but that is increasing in some areas. Edinburgh would be an obvious place. However, I think that the new private rented tenancy will help with some of that stability, but if we continue to see big rental increases, that will put pressure on homelessness from the private sector. When the committee went to visit individuals and organisations to discuss the interaction of social security with housing in Leith a few weeks ago, the group that I was with met a couple of young single parents who had both been impacted by the benefit cap and had been served notice to quit. We had a wider discussion around that, but it seems—that's obviously a huge challenge—to pick up on Ashley Campbell's point about the broad market rental areas. Obviously Scotland is very diverse. There are all sorts of things happening with different pressures in different areas, but the fact that Edinburgh is within Lothian is not entirely representative. Are the DWP taking note of the fact that that could be quite unhelpful? I am not sure of the DWP's specific view on that. The local housing allowance structure has been in place for quite some time, and the market areas have always been very broad. As we have already discussed, there have been criticisms of the system. We do not have the richness of data that we would like to be able to inform the local housing allowance rates. Secondly, because we are looking at very wide geographical areas, it is not the best tool to use. The difficulty is that the more areas you look at, the more complex the system becomes. For every broad rental market area in Scotland, you have four or five different rates. The shared accommodation rate is one bedroom, two bedroom, three bedroom and four bedroom. There are 19 of those across Scotland, and the more you multiply that, the more complex the system becomes, the more rates there are to calculate. I would certainly say that it would be worth looking at the system, but there would need to be some kind of balance between the complexity of the system, the administration of that, the costs of that and what we end up with. The argument is that whatever size of rental market area you look at, there will always be issues and variations within that. It is interesting that Scotland has 18 BRMAs and Wales has 22. One of our BRMAs in Scotland, which is Highland and Ireland, is larger than all of Wales put together. There may be a particular issue in terms of the size of some of the BRMAs in Scotland in that they are huge. Nobody is going to expect somebody to travel from Thurso to Inverness for a job. BRMAs are meant to be based on what is a reasonable travel area. If you are looking at travelling from Stornoway to Inverness for shopping on for a job, that is a huge area that we are talking about. The same with Aberdeen and Shire is a very, very big area. Lothian is a very, very big area. We are looking at lots of different housing markets and job markets within those. I do think that there might be a question about Scotland in particular in that I think that the BRMAs in Scotland are particularly big compared to other parts of Britain. I think that the suggestion to Michelle Ballantyne on the Scottish Government in conjunction with local authorities and the landlord register has a lot more localised granular data. At its disposal, it uses it wisely to get a real grip on what the 30th percentile really means for each local authority area, and maybe that information is not being brought together effectively. Can you say a little bit more about that? I found that exchange quite interesting. Just to clarify, the Scottish Government and the landlord register does not collect data on rent at the moment. There has been a suggestion from some that it could be used to gather more data. I think that there are issues in terms of LHA calculations, but you will also be aware of the new provisions that have been brought in in the private rent detector around rent controls and rent pressure zones. The discretionary power for local authorities to be able to apply caps to rent in specific areas, local authorities are finding it very difficult to use those powers just now because they do not have the evidence there to support the implementation of rent pressure zones. That would be another potential application if we had that kind of data. We just do not have it at the moment. I am conscious that this is a social security committee and it is not a committee in relation to housing, but social security and housing and connectivity and how social security can better support that. Does the Scottish Government have some powers to vary the use of housing cost elements as things currently stand and could alter the calculation of LHA rates in any way to better reflect localised inflationary pressures, for example? What is the scope for that? A lot of that is quite rightly in relation to the UK Government lobby aspects, but the Scottish Government may be able to do more or at least consider more. Any comments on that would be quite helpful. The Scottish Government has some powers over some of the regulations around universal credit, which include LHA levels. I have looked at those in some detail and I think that it is quite complex what could or could not be done. I think that it is relatively small changes. I think that there could be things, for example, around the shared accommodation rate and the exemptions that are allowed around that. Potentially, LHA rates could be varied, but I think that it is quite a complex area. You need to look at that legislation in a lot of depth with a lot more of expertise than I have to do that. I think that there are a couple of questions around that. What would be the cost of that? I think that it could be very challenging for the Scottish Government to meet those costs. I mentioned in our submission that we are doing some analysis that we have commissioned at the moment, which is looking at what would it actually cost to raise LHA levels to the 30th per centile, and we will have that broken down for Scotland. That would cover some of the more detailed things that I have mentioned, but that would give an overall sense of what that cost would be for Scotland if it decided to use some of those powers. I think that the other thing that you need to consider within that is how much more complexity we are introducing in the system. I do not think that that is a necessary argument against it, but it is something that we really need to consider. We have got Scottish flexibilities already and there are some complicated interactions with the wider system in that. I suppose that our sense would be that any changes like that we probably want to focus on Westminster making it first so that it benefits everybody in Britain, but also so that it does not make the system more and more complex. We would not want to see the Scottish Government mitigating something in a particular way and then a year or two down the line in Westminster doing the same thing but in a different way. You are just getting a lot more variation in the system. It would come with a cost. I think that I just wanted to clarify whether the Scottish Government had scope to change some of that criteria and whether that additional money would be picked up at a Scottish level or a UK level, but it would be Scottish Government mitigation if that was to happen? I think that it would come out of Scottish Government budgets. Do you want to add anything to that, Ashley? I guess that if you look at it very simply, the Scottish Government would be able to top up the housing element of universal credit in the same way that it is looking to do so for the bedroom tax. As Beth has pointed out, that would have a financial cost for the Scottish Government. Again, our preference would be for the Westminster Government to reverse the cuts that it has made to local housing allowance. The Scottish Government would have to consider whether it wanted to pay that cost for the top-up itself, for the administration. Obviously, the legislation allows for the Scottish Government to make those changes, but it would still need to be approved by the UK Government. It would need to work with the DWP to set out that system. We have seen with the bedroom tax that it is not quite as simple as just paying the money, that is why it is not being done through universal credit already. You also need to look at the issue of the overall cap on benefits. We found that when the Scottish Government tried to implement the legislation to allow for the bedroom tax to be mitigated through universal credit, we found that in some cases that was going to push some people over the benefit cap limit and then that money would be taken away from the other side. The regulations that were introduced through the Social Security Act have addressed that issue, but specifically for the bedroom tax. I am not sure if additional legislation or regulations would be required to do the same thing if you wanted to top-up. The question was not inspired by what should or shouldn't be mitigated. It was in relation to the mechanics of the powers that the Scottish Government does or does not have its disposals. There are some, but they are quite complicated in relation to calculating LHA rates, which is interesting. We have talked about the shared room rate. I am not sure how many under 35 year olds in my constituency are told that they are going to find a flatmate in the private rented sector and cover that rent. They are just going to get accommodation themselves and then there is a short fall. What would your position be on the shared room rate or LHA rates for those under 35 in relation to how the social security system is helping those under 35 who are hampering and putting them at more risk? The shared accommodation rate is a real challenge for a lot of people. There is not a culture of sharing accommodation in most of Scotland where there is. It tends to be student accommodation, which is perhaps a different group of people. There are issues with both access and affordability in the shared accommodation rate in particular. We know that where people are sharing, they are often having to top up their LHA. In particular, if they are under 25, they are on a lower minimum wage, they are on a lower rate of personal allowance within the benefits system, so they have less resources to top that up. It is a real challenge there. We obviously represent homeless people in particular, and we want to see the exemptions to the shared accommodation rate extended. For example, for people coming out of prison, for people who might be offered housing first who have more complex needs, we would want to see it extended for care leavers. It is currently up to 22 for care leavers. There are also some inconsistencies in the exemptions currently. If you are over 25 and you have had severe mental health problems, there is an exemption, but there is not. If you are under 25, if you have been in homelessness accommodation and you are over 25, there is an exemption, but not if you are under 25. We are making some of those much more consistent and making sure that people who are particularly in need of stable housing are able to access that is really important. We share concerns about the shared accommodation rate and, in particular, the extension of that from under 25s to under 35s. There does not appear to be any kind of justification for that apart from cost saving, so we would strongly call for that to be reconsidered. I would probably agree with your position and best that there is not necessarily a culture of sharing and it is not an easy thing to do. A lot of young people will be looking to make up the difference in the rent shortfall. I wonder whether, just briefly, you are talking about more exemptions in relation to that. Is that just a next step campaigning strategy? Would you rather just share the accommodation rate went or do you think that it is okay to have a shared accommodation rate for up to 35-year-olds, but as long as you put in exemptions, what actually is the position? I think that it is a pragmatic position in terms of where we are at at the moment. As I say, we are costing what it would be to increase LAH rates to the 30th percentile. When we were doing that commissioning that analysis, we were looking at a range of scenarios. Could you put up the shared accommodation rate to a high level? What would happen to scrap that and so on? Partly because of complexity and partly because of the practical cost of some of that. We have not gone down that route. That is not to say that in our ideal world we would not have a shared accommodation rate at all, I think. That is helpful. I know Keith Brown and Michelle Ballarty want to come in. There is one final question on homelessness. We definitely have to ask before the sessions final. I will take Keith first and then Michelle. I thought the answer that the Chartered Institute gave a couple ago was really interesting on mitigation. We often get a very trite cliché that it is simply up to the Scottish Government to mitigate, use its new powers to mitigate that. The practicalities are very different from that. The system itself prevents straightforward mitigation very often. Going back to the first question that I asked about local housing allowances, it seems to me that the response to that was that the system already starts off with structural flaws and problems, which then require mitigation and other things to take place to try and address the flaws in the system. Going back to the point that the Chartered Institute made previously in response to Mark Griffin about the discretion of housing payments and the welfare fund could be made more transparent. It is not just about bedroom tax mitigation, but these other things should be taken into account. Underneath it, please let me from my own words a request for more resources to do these other things, many of which it seems to me stem from flaws with the system in the first place. Would it not be more straightforward to say that it is the structural flaws in the system that have to be addressed first? I think that Beth Reed said in response that endless complexity is then built in trying to find ways to mitigate the structural flaws in the problem that further bring the whole system into dispute. Is it not the system in the first place that we should be focusing on? Our preference with regard to local housing allowance would certainly be for the UK Government to reverse the cuts that have been made. If we are looking at the social security system in the widest sense and how it supports people with housing, the most important thing is to make sure that people have enough income to live off of and that that takes into account their housing costs, but what do they have left after they have paid for that housing as well? It is also important to note that changes to people's housing allowance have not been made in isolation. There have been cuts in other areas that impact people's income as well. We are seeing people who may be managing to pay their rent, but they are not managing to pay for food or for their children's clothes or for other basic necessities. The social security system as a whole, we would like to see working better, but specifically in relation to local housing allowance, we would certainly firstly be looking for the UK Government to take a look at the system and fix it for everyone. There is a danger that we get into the wider housing system here, but there is an issue about supply. We are investing a lot of money in housing benefit. That is one of the reasons for the cuts of billions and billions of pounds going into housing benefit. If you look at the historic trends, that is reversed. It used to be going into building houses and now it is going into paying rents for houses. There are much wider issues at stake here. Ultimately, we need to invest in social housing. We need to make sure that rents are affordable. If the overall market came down, then LHA rates would come down with it and it would be more affordable. A lot of the changes that have gone on have been to reduce the housing benefit bill. A lot of the tweaking is now to try and correct what went wrong when that was implemented. There are real challenges that ultimately come down to a lack of housing and affordable housing in Scotland and in Britain. Michelle Ballantyne. Interestingly, that is what I was going to ask you about. You have kind of answered that. Can I just ask a little clarification on your earlier point around shared accommodation rates? You said that there is not a culture in Scotland. Is there a different culture in England and Wales when it comes to shared accommodation? I think that, certainly in London and south-east, there is a lot more of a culture of sharing. I am not sure about other parts of England and Wales. To some extent, there is a sense that that policy may have been developed on the basis of a culture that is specific to one part of England and not necessarily appropriate for other parts of... Based on affordability. Based on affordability, what point does a need for affordability become a culture? I think that there is more of a culture in London and south-east of sharing up to a much older age than would happen in other parts of Britain. I have a final question to finish off. Can the committee explore two aspects in relation to how the social security system can help those at risk of homelessness and in homelessness and temporary accommodation? The committee has been asking questions about concerns in relation to the cost of temporary accommodation. I am resisting going on with the quality of temporary accommodation. Another committee might look at that in more detail, but it is not always satisfactory. The cost of it is that local authorities organise. We have a high-watering cost in Edinburgh certainly for temporary accommodation, the use of bees and blikes, but certainly in my city of Glasgow and across Scotland. You link into that the amount of housing benefit there is in the system that supports people in temporary and secure poor quality accommodation in a very unsatisfactory way and does not particularly support a sustainable solution or a path out of homelessness. Ideas on how the social security system can reduce some of those costs, because those in work and homeless often have to suffer because they are priced out of safety and temporary accommodation, but we can use that money more effectively. In answering that, I am sure that the Scottish Government, through the work of housing and rough sleeping action group, is trying to get a quantum around the amount of housing benefit in the system that supports those in temporary accommodation. I know that COSLA is sympathetic to trying to capture that overall pot of cash that has currently been funded to see what is our inflexibility in the system. Does it just sustain a system that is actually failing a lot of homeless people in Scotland and could that money be better used? COSLA has suggested that perhaps the devolution of housing benefit in the use of that pot of cash much more imaginatively to tackle homelessness and tackle issues with temporary accommodation will be a much more progressive way forward and a better use of social security spending. It is a lot in that, but it is important to put some of that on the record, because we have a really interesting submission from COSLA in relation to that. I do not ask the Campbell to go first on that. That is a quite complex question. There is recognition within the sector that the current structure of temporary accommodation and the way that it is paid for was unsustainable. As you have pointed out, some of the costs of temporary accommodation are extremely high. There is work that has been done to try to recognise and capture what some of those costs are. There are some genuinely higher costs for temporary accommodation in terms of staff costs, support costs, furnishing, void, turnover. There are additional costs associated with that. I think that the figure that you quoted in the SPICE briefing for Edinburgh was £1,900, which is extortionate. That is not sustainable for somebody who is in work, let alone for the social security system to sustain. There is recognition that that needs to change. You will know that there are changes that are happening as a result of the hard side recommendations. The Scottish Government and local authorities are looking at the use of temporary accommodation and reducing the use of temporary accommodation in terms of how the temporary accommodation is paid for through the social security system. Our concerns would be around making sure that the costs are realistic, that funding is based on need and entitlement. You will know that the UK Government was looking at how temporary and supported accommodation will be funded in the future. There were suggestions around devolving a pot of money to pay for that. That would be a fixed amount. We were very concerned about that in terms of what would happen if need increased in the future. Would there be flexibility to be able to pay for that? Or would there be constraints around how much money there was? I do not know the details of COSLA's recommendation about devolving housing benefit and how flexible that would be. To be fair to COSLA, the route to our attention and said that it supported the efforts of the group and the Scottish Government to get the quantum around that and to see how that money could be used more effectively and whether the devolution of it would be a more effective way and realistic and practical way of taking that forward. I do not think that beyond that they have a position that they would want to misrepresent COSLA, but I thought that it was interesting that they were supportive of some of those moves. I would certainly agree with the need to look at making the best use of what resources we have. Our concern would be how that amount of money was calculated if it was going to be devolved and how flexible that would be going forward, because we want to make sure that that is based on need and not a finite pot of money. The recommendation that you are talking about in terms of devolving housing benefit for temporary accommodation to Scotland was a recommendation of the homelessness and rough sleeping action group, which are chief executive chair. I think that that is what COSLA is referring to and there is work going on as part of the ending homelessness together action plan work. I think that you have referred to, which is looking at what the costs of temporary accommodation are across different local authorities in Scotland and how we can best use that. Another recommendation within the Haasag was that temporary accommodation rents in Scotland become much more aligned with LHA rates. I think that that is going to be very challenging for local authorities to achieve and it will need considerable time to do that, but I think that that would address some of the issues that you referred to in terms of people coming out of temporary accommodation or people trying to work in temporary accommodation and just being utterly unaffordable and unsustainable to work. In terms of the wider issues about how we would reduce temporary accommodation costs, that was a large part of the remit of the Haasag group and all local authorities now have to have produced rapid rehousing transition plans, which will be about how they move to that. We would see the private rented sector as a really key opportunity within that, as long as it is affordable. We would then go back to our point about whether we need to make LHA rates affordable to make that a genuine route out of homelessness or to prevent homelessness in the first place. If we can get a private rented tendency in your local area, then that would be an ideal way of doing that if we are not able to access social housing, for example. Okay, thank you very much. Are there any other questions from committee members before we draw to a close? Okay, can I thank both witnesses for your evidence this morning? I am sure that you will do anyway, but we would be keen for you to follow the conclusion of the work of the committee. If there are any additional comments or evidence that you want to give us in written form, please do that. We appreciate your time this morning. Can we suspend briefly before we move to our next panel? Okay, good morning, everyone, and welcome back. We are still on agenda item 2, which is committee inquiry into social security support for housing. When I welcome our second panel, and I'm delighted that the Department of Work and Pensions has some witnesses here this morning. I thank Pete Serrow, director of working age policy, DWP, Richard De Souza, Head of Universal Credit Engagement Division, and Derek O'Day, group director central in west of Scotland, for joining us this morning. Thank you, gentlemen, for coming along, and thank you for taking time to sit through the last evidence session as well. That was appreciated. We'll move straight to questions. The first one will be from Alison Johnston MSP. Thank you very much, convener, and good morning. I'd just like to kick off with expanding on some of the evidence that we heard in the earlier session. You may be aware that crisis and others have raised concerns with the operation of universal credit Scottish choices. Its submission to the committee's call for evidence says that, in some cases, even when someone is on fortnightly payments, their universal credit statement continues to record them as monthly, and that that has caused anxiety and confusion for some people. I'm sure that you'd appreciate that. Obviously, similar issues have been experienced with direct payments to landlords, which have been requested and granted, but I haven't materialised for one reason or another. I'd just like to understand if the DWP is aware of the issue and if you could expand a bit on what might have gone wrong in that situation and what the solutions could be. We're aware in high-level terms that Richard may want to come in on some of the detail, but constantly on those things, we don't always get it right. We try and get it right, but we do work very closely with other people in the system, with local authorities, with landlords to try and make sure that the system works as well as it can do, where we are told about things that aren't quite working correctly, like that point about the system still saying payments are monthly rather than fortnightly, then you will definitely try and progress those things and put them right. Richard, do you want to come on any further? I don't know much about the detail of it, but any information you can give us, and then we'll take it away to fix it. It's as simple as that. I don't know if I don't know any more. If it's a build feature in the system, then we need to go away and change the IT, but we also need to make sure that the guidance and the training that we give to our people is right as well, and obviously on the ground. I understand that it's in the build feature, which was laterally a feature that we're waiting to amend. Obviously, as part of that, we're upskilling our work coaches and giving them further information as to then pass on to claimants that this is the case, that while it's saying that in the system, we will message them through their journal that this is the case. When we say build, because there's a risk that we move into DWP jargon, when we say build feature, it means that it's something that we've got to build into the system, and you'll appreciate that there's a queue of things to get into the system, so it's a question of prioritising those things but trying to deal with them as effectively as possible in the meantime while we're trying to put them in. I was pleased to learn about the work that crisis have been able to do with five Edinburgh job centres and, obviously, further fielding coventry. I'd just like to understand what training front-line staff have when it comes to being aware of the housing situation, facing some clients, how decisions such as sanctions might impact on the clients, what the long-term impact of a decision that might be made could have. I just want training front-line staff are given so that they understand how best to support clients. In terms of our front-line training, all our staff have had housing confident training throughout the whole year, so we will now have each member of staff in Scotland has went through housing confident. Last month, we got the executive board to agree that we would redo the training, so we've got commitment that we will re-evaluate what we did. We're currently setting that in motion and making sure that what we didn't do so well. Some of the really complex elements, we know that we get that through the complaints data, through other sources. That's the kind of information that we're going to use to roll out this year's training. Particularly in Scotland, what we're doing this year is where we're creating a strategy. This year in Scotland is all about the learning and development of our people, so every one of our people this year will go through an individual learning needs analysis and, as a part of that, these types of issues will be recorded and anybody that needs further training will be given it. We've created a culture in Scotland where we can now see people putting their hands up and saying, we don't quite understand that. It's a complex piece and we're very happy to retrain people on that. This is a whole year of learning and development in Scotland. It's certainly a complex area within which to work. Is there a requirement on staff implementing sanctions to consider the impact that that might have on the person? Generally, yes. To look at the circumstances of that individual, the reasons why perhaps they didn't comply, but also to take account of things like their housing situation, so that's part of what I think has been an excellent developing relationship with crisis around Edinburgh and other places, such as Newcastle, is helping our people to really understand and get into the circumstances that individual claimants have. Sometimes without that understanding if the relationship isn't quite right, they may not have things shared with them that otherwise they would. Once they know about those things, then, as I think some of the evidence that Beth gave earlier suggests, that enables our work coaches to take account of those things and perhaps not give a sanction when, if they didn't know that, a sanction would be appropriate. Yes, that would be one of the factors. What are the features that were also done in terms of sanctions this year, just to be really clear on this, sanctions is an absolute last resort. All our people in Scotland know that. They understand that that has been widely communicated and we're leading that out to the extent that no sanction will be applied without a manager on site looking at that individually. We've taken that action in Scotland to give us that managerial check before a sanction is applied. Can I just check on that? There will be a lot of public interest in relation to sanctions. Can you give me some statistics in relation to sanctions in the last year on how many claimants have had their benefits sanctioned? What is the trend showing? What are the numbers showing? I don't have stats in front of me, I'm afraid, but I'm happy to share those with you after the committee in writing. I mean, that would be helpful. I'm trying really hard to be respectful. My question wasn't going on in sanctions, but I would have thought when the DWP comes to the social security committee, you might anticipate at some point down the line that you might be asked about sanctions and not to bring that information with you. It's unfortunate, particularly for Mr Colday, who quite passionately made the case that sanctions are a last resort, but then you can't give me any numbers around sanctions at all. We're better briefed on housing matters because that's what I thought the committee was about. Absolutely. We're going to go into rent arrears in a second as well, but I would have thought, given that Mr Colday volunteered that information, you would then have had some figures to back up, substantiate that, but please give them to the committee. One of the issues in relation to housing is the increase in rent arrears on balance sheet for housing associations and for individual tenants since the roll-out of universal credit going live. I said in the last evidence session that the four local authority areas that retain the vast majority of their own housing stock—East Lothian, Highland, Eastern Barcher and Midlothian—went live first, if you like, and had a 26 per cent increase in rent arrears on average. That came to about £5.7 million in that two-year period. That represented about 10 per cent of the population of Scotland. I think that you have to take in River Clyde Homes to do that as well. It had a 35 per cent increase in their rent arrears. What would you put that down to? I'll hand over to Richard in a second. In broad terms, there's a lot behind rent arrears, and there's a lot of rent arrears that exist for people who aren't on universal credit or housing benefit or anything else. It's a wider problem. I think that we did find, particularly in the early stages of UC universal credit roll-outs, that there were some issues that we found around implementation that led to some difficulties. We've done an awful lot to address those. I think that some of the issues and some of the stock of rent arrears that are reported, that may be linked to universal credit, are the result of the way that the system was rather than the way that the system is. Just to illustrate with two things. First, advances. Now, we've promoted advances. People can get 100 per cent advance pretty well from the first day of a claim of their full universal credit entitlement. Something like 60 per cent of people are taking that up. Now, if you look back two or three years, it was a much, much smaller percentage and it was only a 50 per cent advance. That sort of thing has really helped to enable people to pay their rent up front. The second area that, frankly, we did struggle with was for customers' claimants in social sector accommodation, where we found that when we were trying to verify rent, what the tenants thought they were paying in rent was not what the landlord thought they were paying. There was a real mismatch in information. It took us a long time to verify that information, which led to delays in payment. That caused problems. We brought in a landlord portal and built up the relationships with landlords around that. Richard can say rather more about that. I think that there's a lot been done to improve the system. Just before you want to talk about the landlord portal, Mr De Souza, that would be very helpful. That information was helpful as well. Given the local authority areas that I mentioned, we're the first four or five, including Everglide, to go universal credit fill service roll-out. We have it a period of time now. Are you able—have you looked at those figures—to be able to tell us of that 26 per cent increase in rent arrears? How much of that was a cyclical rent arrears? It was part of the points that Alison Johnstone was making about you're not really in rent arrears. It's just the way the payments are accounted for on the balance sheet. How much of that was individual claimants having other living expenses because of a five, six, seven, eight, sometimes nine-week delay back in the early days of universal credit roll-out? And how much of those rent arrears is caused by structural systems within universal credit? You've come to this committee before as a part of working pensions and said what you do is you test a system, you improve it, you roll it out a bit more, you test it, you improve it and roll it out a bit more. I assume that you'll be able to give the committee some more information in relation to detailed information in relation to living rent arrears and the reasons for them in those four or five areas that were the first to roll out or go live in universal credit. As I said, the rent arrears in those first four areas come from a whole broad range of different circumstances, and the local authorities would be the ones who are best placed to understand what the sources of those rent arrears are. What I can say is that we've learned, we've addressed issues that we saw working with those partners, those local authorities in the implementation of universal credit, and we've addressed those with that whole range of changes that we think too early yet to get real strong evidence around it, but we think is feeding through and improving things. Much of those arrears, to the extent they are universal credit-related, would be technical or book arrears, as the previous session brought out. However, in terms of a brief detailed breakdown of the causes of those arrears, the local authorities, rather than me, would be best placed to answer that. The DWP has not sought to analyse those numbers then. We do know that a lot of those special in the areas that you mentioned arrived with pre-existing rent arrears before they came on to universal credit. Over time, we do know that when they've been on universal credit for a period of time, the volume actually goes down, but those four that you mentioned came with a lot of arrears from those early roll-out sectors. To get a proper handle on this, what you need to do is link data from the landlord with data from universal credit, so that you can tell when somebody came on to universal credit, did the arrears arise at that point? What we've done is we've been working with the Housing Association in the south west of England to perform that data match to see can we apportion any growth in arrears between these different causes? That does tend to show that initially people come with arrears. There's then a rise early on because in the past, if you were a local authority talent, you've got your housing benefit paid weekly and you've got charged rent weekly, so once you're in the system, you couldn't get an effect on arrears. Now we pay you five weeks in arrears, you will get that money eventually, but there will be a cash flow impact. We noticed that as well. Then, because we can recover arrears faster in universal credit, the under housing benefit, the arrears then tend to stabilise and fall away. We've only done that with one housing association. We're starting the process with two or three more. We also need to do it over a longer time so we can see what does this decline in arrears continue and then get us back to where we were at the start. That analysis is going on, but it does require rather close data sharing, so we have been able to do it with the local authorities you referred to. That seems to be the profile of arrears and how it arises. The interesting thing is that it's largely this technical financial arrears or cash flow arrears. One of the concerns would have been, well, hold on, we used to pay all of our landlords directly from local authorities under housing benefit. You are now going to give them money to the claimants. Isn't that going to put that at risk? What if they default? What if they don't pay? That noise hasn't surfaced and I think the reason it hasn't is because with the landlord portal, we also give landlords the opportunity and they've all taken it up to be trusted partners. If you're a trusted partner and you want a direct payment made to the landlord, DWP doesn't interfere because you as the landlord are the best judge of that. That stabilises around 30% of the case load being put on to direct payments. That was the same in the pilot as it is in the national roll-out. It seems to me that that first line of defence against real arrears in inverted commas is working quite well and what you're picking up there is the financial book arrears because you used to pay the same week that the rent arose. Now there is a five-week cash flow. First of all, I thank for what I think was an offer in that reply to go back to East Lothian Council, Highland Council, East Embarkshire Council, the Mid Lothian Council and perhaps River Clyde Homes and do a proper data analysis of those arrears that have been reported to us through COSLA to better understand them because we have heard concerns about the five-week wait minimum is causing significant issues for social landlords. We have heard concerns that other debts that people accrue when that money then goes direct to individuals and families. They have to prioritise sometimes other items to spend money on other than the rent because you have to go the immediate set of where, if you have to feed your family or get clothes for the kids and that kind of thing. We have heard all those concerns from the social renting sector including local authorities and we have heard concerns in rent arrears so I would really appreciate a proper partnership analysis from those four local authorities in that housing association with the DWP. That would be incredibly helpful because what Mr D'Souza says is a little bit out of step with some of the information that we have had but a partnership approach to getting beneath those figures would be very welcome. I will say something would you can but not before but to be fair I don't need your help Michelle Ballantine and I think Mark Griffin wants to explore that further Mr Griffin. I want to continue to ask a question on direct payments. I want to ask first of all what the administrative difference is for the DWP with direct payments in running an alternative payment arrangement and operating the Scottish choices direct payment to landlord. What are the administrative differences in those two approaches? I will start and colleagues might want to come in. Alternative payment system is essentially our way of trying to pick up vulnerability so up front looking at a claimant and trying to gauge whether whatever that claimant may want actually is it in their best interests for the payment to be made direct to the landlord so cases where claimants might say actually I'd rather have the money myself we might say well we think frankly you won't use it wisely and you won't pay your rent so we're going to protect you we'll put a direct payment in place which is part of that alternative payment arrangement and that will be something I mean Derek can correct me if I'm wrong but something that will be gauged by the work coach in that kind of initial conversation when they claim. Scottish choices is giving people claimants that choice to themselves. There's a way a system should work is for us to assess the vulnerability first so not to give a straight choice necessary to people who might not choose wisely so to make sure we're picking up those vulnerable claimants first through the alternative payment arrangement system and then to move on to Scottish choices to give that the claimant who may have chosen who we may have decided could cope with dealing with the rent themselves actually would you rather it was paid to the to the landlord director and that's that would happen from the second assessment period yeah just to follow on from what Pete's saying this is absolutely to protect vulnerability at the first point of the first point interview our work coaches are having that conversation making a judgment call based on the information they have in front of them the conversations they have to see if it would be better to put this person on this before we allow them at the second assessment period to go into making a Scottish choice so they would be catching the vulnerabilities at the earliest point of contact and just coming back to convener's point we are already working with those local authorities that work is in training also let me put on the record that local authorities have tried to decipher where they think they think those rent areas have accrued but what was unclear about was whether or not there was that partnership work so that gives me some form of reassurance and that's helpful mr Cull day for putting that on the record I understand the policy difference between alternative payment arrangements and Scottish choices what I wanted to understand was the administrative operation what is the difference for a work coach sitting with a client what is the difference of process between processing an alternative payment arrangement and processing a Scottish choice direct payment in terms of actual detailed price but very little Scottish choices was mirrored on what we're doing with alternative payment arrangement but it happens further along the line so the actual administration and the effect to the work coach conversation is no different and no more administratively cost layer either way and it would fees you know so the work coach has the conversation and you know passes on the information then it would have to feed back to to our service centres it will implement that on the system to make sure the arrangements get put in and that would be the same you know different flags or whatever on the system but it'd be the same for for an alternative payment arrangement or for a Scottish choices the process the background process is the same the training need which which is Derek talked about a lot we've done a lot on housing confident is how do you establish rapport with somebody so that you can identify that they are vulnerable and need a need that direct payment or not and that's where a lot of the the extra wraparound training goes okay that's helpful to understand that from one of the early evidence sessions we heard evidence of a concern that clients were declaring vulnerabilities around about addiction or other things but were being processed along a Scottish choices option rather than an alternative payment arrangement so i don't know if you want to look back at some of that early evidence and perhaps come back and writing to address that but given you've said that there is no administrative difference can you say why an alternative payment arrangement applies from the very first payment of universal credit but Scottish choices direct payment only applies from second and subsequent payments again Derek may want to sort of amplify or correct but but essentially it's that it's that identifying vulnerability first so you know if you if you ask them at the same time then Scottish choices should have could effectively trump the the vulnerability question and we want to make absolutely sure most of all is that someone who really needs irrespective of what they want but someone who really needs to be looked after and to have their money their rent passed direct to the landlord that that happens so we need to get that right in the first assessment period and it's only once that's sorted out that in the second assessment period we move on to Scottish choices it's simply that that ordering that leads to Scottish choices being in the second assessment period i think on your on your point that you made i think we are aware that it hasn't always been right in the past and it's something very much were actively looking at the absolute in term of your point i've not been right we recently wrote out to all our work coach team leaders across scotland reiterating the point because we do know your point mark but that was what was happening so we've reiterated that across scotland recently as Scottish housing leader put that memo out about a month ago to just bring that back to our work coach notice that's very helpful because obviously with Scottish choices for every choice the Scottish government has a cost to pay for every transaction as opposed to the DWP picking up the cost for alternative payment arrangements so that guidance going out to the work coaches i think is is absolutely essential and that's good to hear the committee has been looking at the the evidence that we've received and been considering whether the Scottish choices using the discussion the Scottish government had has to make payments direct to landlords as a default and given an option to tenants to take that choice to to take it directly i'm just wondering what the sort of DWP state of readiness would be if the Scottish government were to pursue that policy option of automatic direct payments to landlords i mean it's something we'd we'd have to to look at if they chose to do that then we'd obviously very happily talk to them constructively to try and support them in implementing whatever policy they they chose to follow you know there are a lot of things that we want Scottish government want national northern island want wales want to happen to the around the uc system so we need to prioritise that's why for example the changes around the removal of the spare room subsidy through uc that's going to take a while it can't be done sort of immediately so we'd have to look very closely at whatever it was the Scottish government chose to do and then to talk to them about what might be possible and when it might be possible and what the cost would be okay thank you Jeremy Balfour thank you and good morning i suppose it's just really falling up a wee bit from the previous question i mean i'm still slightly unclear and maybe it's means that we've had a number of people give evidence to say that the first payment to a landlord doesn't go on time or doesn't go directly and i think you've answered that slightly but it does seem to me that this can then lead to issues around debt and around the trust between the landlord and the tenant so is it now the situation that if i am on universal credit and get housing benefit that that first payment will go directly to the landlord if i request that as a first payment would it always be the second payment it should it should if if we put you on an automatic an alternative payment arrangement it should be the first payment and it won't happen automatically it's only if our work coach decided that that's the appropriate way forward that it should be a direct payment then it should be the first payment do we always get that right did we always get that right in the past and you know the honest answer is no are we doing much better now than we would have been a year or two years ago you know definitely but i certainly wouldn't suggest we always get it right now and we're looking to continuously improve that sort of thing that Derek wrote out to colleagues about a month or so ago i mean the issue that we we've had some issue round is in regard to the portal for landlords and the information that can be got there and i suppose if more work been done on that and what consultation is taking place particularly with private landlords to make sure that they can access that and have that information that they want and that you want in that you know so it's a joined up system Richard so the landlord portal is only available to social landlords because it allows access to people's data and obviously social landlords are registered and regulated in a way the private landlords aren't so there's a policy reason for not having private sector landlords on the on the portal what we're doing for them is to build an online system so that they can apply for a direct payment much more simply than they can at the moment but the landlord portal itself is designed for social landlords it was designed initially with one really important function which was to verify housing costs so that people could be paid in the first assessment period if you're on the portal now you're in the mid 90% so that people will be verified in the first assessment period so it has done that job it has got the potential to do much more but we need to roll it out first so we make sure that everyone's getting their housing cost paid in the first assessment period first but it has the functionality to do more and what we do is with our regular engagement quarterly basis with Scottish landlords with national landlords across GB we invite them to say what the things they would like to have next on the the list so we can put them into prioritisation so it will over time grow and do more things but to start with we just want to get it to do its its most fundamental purpose for everybody and we're not far off that so within I think by the end of May we'll have invited every landlord to a social landlord to be on the portal if they so wish I suppose one of the issues for for claimants has been by every two weeks my understanding is that they have to get a fresh mandate so if I've got a representative helping me say from CAB or from some advice shop and I'm wanting to engage with universal credit with with the DWP I if I want someone to do that on my behalf I either have to get a mandate set up every two weeks which seems to be quite cumbersome or that person has to be there and it seems to be quite difficult particularly my telephone and some of the evidence we've taken around this is that it is becoming quite difficult to actually talk to the right person and obviously we move away from local authorities to essential system is part of that is there any way that this can be more streamlined for people who clearly need assistance in being able to ask the right questions so I don't recognise the two weeks what I do recognise is a single issue so because because we bring all the data from six benefit systems into one place that's owned by the claimant so it should be up to the claimants decide who has access to that data so you only have to apply for again if the issue once the issue's been resolved so so you're allowed to bring somebody in to have that conversation on a particular issue that seems to be sensible not everything if that issue isn't resolved within the first assessment period I think you then have to ask again but you can do that through the journal if you're online you can do that over the phone or you can go into a job centre and do that so it should be pretty straightforward for somebody to be able to to do that but they have to do on an issue by issue basis we haven't can't give someone a portmanteau open house to talk about anything that you might have on your case that seems to me to be an invasion of sort of someone's personal data in the context of moving people across from the legacy systems we're working very closely with stakeholders to see well how can we help people help other people more effectively because this is a bit of a bureaucratic thing there which and we've got a lot of feedback with workshops we've been having as stakeholders saying we'd love to help people move from the legacy benefits eventually to UC and to be part of that conversation but you're not helping us to do that so with social security advisory committee and ourselves and other stakeholders we are looking at how we might kind of flex this in a more sort of productive and helpful way particularly around that rather difficult move across okay thank you my final question is clearly in any evidence sessions that we've taken we always you know a bit like people only come and tell us the negatives you never hear the positives do you have just districts to say you know off the whole system in regards around this around paying paying money in regard to the landlord relationship to the tenant relationship do you have any figures to say to us how much is actually working well you know compared to those who are having problems please i said maybe i don't have a question answer but for me you know obviously we hear lots of negatives because that's what people come and tell you we never come and tell you we had a great experience are you are you collecting any data around how this is working as a whole so we can have a holistic approach to this certainly in scotland we can say that we look at this on a weekly if not on a monthly basis and we know that there's a consistent trend in scotland we'll be paying over 85 percent of people correct first time in the first assessment period we strive for higher but we've been consistent only among the top three in the uk and scotland for the past six months so 85 percent for people who are on university credit right get in you'll be paid correctly on time on time i'm actually 85 percent first assessment period and it will be significantly higher in the subsequent assessment period and that is you know in some ways you might ask well what about the other 15 percent you always try and improve that but a fair proportion of that other 15 percent will be people who haven't provided the information we need to verify something or haven't not willing to sign a claim and commitment so a range of reasons we're trying to improve on that 85 percent we've tracked that very closely um it was a long way south of 85 percent a few months ago which i think is part of that well a year or two ago which is part of i think the the kind of history of problems that um that people are rightly talking about it's in a much much better place now and has been consistently consistently for the last few months i mean i wonder however you could just provide that maybe information over the last two years so we can see the improvements taking place uh but you know i appreciate you won't have that today but if you could provide that invite him forward that would be so yeah so that's where we can go you can take it back two years but we won't have uc in scotland fully rolled out we didn't roll out uc in scotland until december so each of the areas we've been working across in scotland has increased and increased and since the beginning of the term of this year we've been hitting over 85 percent in scotland consistently played correctly in the first assessment period there are no published figures on this that we're happy to share and sign post thank you committee we'd really appreciate that and that's a positive thing for dwp to put on the record when you're providing those figures it'd be quite helpful to get what the story is with other 15 percent because it's part of that 15 percent there may be some that are outliers that that'll wait a significantly longer period of time so maybe what the average delay is within that 15 percent as well would be quite effective to better understand that but it's positive to hear there's a constant strive for improvement but to better understand the full 100 percent not just the 85 percent would be welcome Keith Brown to follow by michelle ballantyne yeah i'm looking forward actually to first ministers questions and general questions today given what jerry ball for said that people coming forward with what's working well and not just what's not working well so it'd be interesting to see how that works out in the parliament on the issue of arrears i we've heard a number of times in evidence that of course the cost of homes or the cost of providing accommodation for people that homeless or temporary accommodation is much more expensive and sometimes that happens as a result of the arrears that have been built up for whatever reason and sometimes it happens because the level of deduction from universal credit is so high that it forces people out of the accommodation that they currently have i think it's 40 percent up to 40 percent of somebody's unit which may be 317 pounds a month for a single person over the age of 25 so 40 percent of that gets deducted it's much harder to sustain a tenancy in that circumstance have you any views on the level of deduction i know it's an active discussion just now with the committee on working pensions at Westminster on what a more sustainable level of deductions would be and by sustainable i mean one which would not force people out into other forms of accommodation do you have any views on that well as you say it is a maximum of 40 and it's 40 just to be clear of the standard allowance so not the full universal credit entitlement including housing and various other things but just the standard allowance that is a maximum so lots of other people lots of people will be paying back less than that you know on reflection the department current secretary of state has thought that that's a bit too high so we have plans to bring that back down to a maximum of 30 percent i think from next year i don't have the precise date in front of me i don't know where the rich knows so i think from at some point next year we'll bring that down to 30 percent there's always a balance here though so part of those deductions are to help people keep their electricity flowing keep their water flowing so to make sure that they are paying back at a rate that they can agree with with utility providers and with their landlords for arrears so to keep them in stable circumstances so it's a balance between making sure that they're paying those things off in a way that works for for those organisations keeps their relationship with them stable but not take so much that it puts them in in real hardship and you know we're always happy to keep looking at that balance both at the individual level and at the macro level but the plan is already to bring that maximum down to 30 percent from from next year i think and what i thought was so interesting that the for advances the the 12 month period repayment period is going to then go up to 16 months so secretary of state announced that as well so it's not just the rate it's also the term as it were that matters yeah i mean i think it's interesting i mean those deductions can be for all sorts of reasons and not just for rent arrears as you mentioned and i would want to make it clear these deductions are preferably legitimate people need to be paid for money that's over i understand that point but even if the 30 reduction is what happens i think the working pensions committee recommended five percent which is a big difference it's six times obviously the amount i just wonder of whether the dwp has any ability to interrogate the data to the extent they could say if this is causing if the level of deductions is causing people to leave the tendencies that they're currently in and then have to be accommodating it other way that's obviously a pretty big cost to the taxpayer and if it is the case that the secretary of state goes for the 30 percent level is it possible to work out the cost of doing that as opposed to the cost of reducing it to five percent obviously part of the cost is that people that are old money will get paid less over time but the cost of the taxpayer is there any way to work out that figure with the systems that you have the cost that's been incurred by people being forced out of tendencies that might otherwise not be if the deductions were less i suspect it's very very difficult to work that out partly because you know someone leaves the tendency that there are usually a number of reasons why they left the tendency and you know the extent to which the level of their deductions being 30 percent rather than five percent it's going to be very very difficult probably impossible i would say to separate that out that i think and derrick may know better than me but i think that you know we would always look to to say well that's the maximum but actually in your personal circumstances what is the appropriate amount how much can you afford to pay back i would say that if you bring it down to five percent as a maximum so a lot of people probably are only paying five percent now if you bring it down to five percent as a maximum then there's a real risk that that would create additional concern amongst landlords additional problems with utility companies and actually would cause more problems than it would solve but that's something that we can explore with work convention select committee further but as i say it's very much a balance to get you know that the payments may keep people in stable position but also in a position where they can afford to to feed themselves and pay their rent my last question for you i think that last point is interesting so you might find a sustainable position where people can pay the deductions back and sustain a tendency but to think the department of work conventions or other work conventions committee found that would be often be at the expense of any discretionary spend if you can call it that for things like food given how little slack there is in terms of the amount that's paid in any event but i suppose the last point i would ask is that if it's not possible to interrogate the data to find out whether a change such as that would be beneficial to the taxpayer and by which i mean five percent or 10 percent as opposed to 30 percent which i think is quite a big issue and i would imagine there's a big amount of money at the end of that i don't know of course but if it's not possible to do that that suggests to me a kind of limitation on the systems which are being used and we just go back to a point i think this committee heard before that some of the legacy systems in the DWP for universal credit included a paper based system in a basement somewhere dating from 1948 and i don't know whether any of the legacy systems that you're having to work with in relation to the housing element of universal credit are like that i suppose my question is given that it doesn't seem possible to work out the opportunity cost of having deductions at 30 percent are you happy with all the systems that you have are providing the best possible information for ministers to take decisions on if i can put it that way am i happy that all our systems provide the best that it would know you know in part that's that's why we're bringing in universal credit and bringing in a you know that the universal credit full service a very digital system that will give us all of that we're building it it's not fully there yet but we're building that so you know we will be in a much much better place in two three four years time than we are today or you know a year or two ago um you know some of our systems i think the carers allowance system and carers allowance is being devolved but you know that that dates back to the 1970s and i didn't even realise that computer systems really existed in the 1970s but we've still got one or two just about working so that they are very clunky i mean i think on you know going back to the inference you drew about the the five percent 30 percent issue you know i think we can get data on who's paying five percent who's paying 30 percent um for what you know that sort of data we can get we can analyse that and we can provide advice on the back of that data simply doesn't exist anywhere and couldn't exist however good our systems were about the behavioural consequences of of that because there's so much else going on you know that's that's just the complexity of the world and no administrative system could ever take all of that into account we could try and make judgments about it but it's not a system issue thank you good morning um interesting your last point about how how do you figure out what people are doing and how they're behaving and and it is indeed extremely complex um and you know going back to earlier i have been gathering a lot of data looking at some of this and what are the impact on renteries etc and subject to what you were asking earlier um i have some figures from some of the areas that i've bought with me today um East Lothian you mentioned 75 per cent of tenants had renteries prior to claiming UC um the average debt owed by UC claimant now has gone down from 1,022 pounds down to 786 um since the rollout so and and that is repeated in all the different councils that have come back to me with all the data so and on average the increase seems to be where it has gone up initially um it's gone up a rap between one and two percent of total debt owed do those figures reflect your experience on the ground with your claimants because the message i'm getting back from a lot of councils is that it does go up initially and then it seems to come sort of gradually down so those have been on it longest um i seem to seeing that trend and i've got a few here i've got sterling clack manager West Lothian East Lothian um and they're all reflecting similar similar patterns it was Richter's point earlier on that that is absolutely the profile that we expected to see and it is now playing out as universal credit it's becoming more mature as we move through thank you for sharing those and i stress again in addition to that some of those figures will flow from points of time a year or two years ago and we've done a number of things since then that should mean that less arrears are likely to build up in the short in the short term so actually the initial sort of rise should be rather less so things like the 100% advances from originally 50% things like the two-week housing benefit run-on so that's essentially two weeks of free housing benefit in parallel to universal credit entitlement that people can can use to prevent arrears so a number of things we've done should actually mean that for the future it's it's it's less problematic than even that and i think you know for me what what where i'm really concerned is obviously there is a high level of structural debt in many of our benefit claimants that that go back you know looking at some of the figures where they've literally some of them have sent me a series of date month on month going right back way before universal credit was introduced and i think it's some of those behaviors and i think some of the evidence from crisis is where we need to be looking at what happens to people how their behaviors affect relationship breakdowns et cetera and i think when it comes to housing and the delivery of benefits i'm very interested in that sort of wider support that sits around individuals and how they get that and i wonder if you could just touch again on the kind of things that you feel you can do you know as a DWP in the job centres to actually support some of that when you're meeting because you have the opportunity obviously when people are coming to claim benefits and talking to you or communicating with you and i do think it's extremely important how people are treated during that period and the support they get so if you could just elaborate a little bit on that it'd be helpful just actually to to back up part of what you were you were saying there just for completeness in the COSLA submission in relation to structural debt or debt that claimants have before they move on to universal credit cos let's say while we would accept these points they do accept those points the data we have gathered generally shows sharp increasing the levels of rent areas once local authority areas go into full service feedback from our feedback from our member supports of you that the way universal credit is structured exacerbates the problems both for land wars and for tenants so it's one of those things where we absolutely have to accept that point but there may still be structural issues there so it's important you put that on the record. Michelle Derrick i think you were going to define that. Yeah i think in terms of that the removal of the seven day waiting period will be a big factor that we expect to see a big difference where we get in that peak at the moment i think once that the seven day waiting period settles that's when i think we'll see that should smooth that part out a wee bit so in terms of the bigger wider engagement we do a lot of area and partnership level team and homeless action Scotland director meets with us regularly we also chair the quarterly round table and we will walk the customer journey with with all the partners of that to try and understand what can we do better we've got an awful lot of work going on in terms of that not just at director level that filters all the way down each of our job center team leaders and managers have developed really good relationships and we we're often asked to come in and be part of these interventions that we're talking about and walk the customer journey one of the ones that's really interesting in the last few weeks we've been working with Glasgow and looking at what we do with Shelter and other homeless organizations to try and understand better how do we get to that position that we can totally understand the journey so we worked with the Simon community in Glasgow recently and a number of our senior managers went on the streets and walked with the Shelter members and really to try and understand homelessness and all of its all of its aspects in that so we're setting up a meeting with them in the next couple of weeks to try and have an understanding and see so what can we do what can we look at the way that our policies and structures are built to try and unlock some of the things that's causing difficulties for people that are working in this arena so we're stepping into that arena and trying to develop deeper and wider partnerships and all aspects. I certainly think it's incredibly important that all individuals feel confident to come and speak to somebody before they get into difficulty and it feels to me that's one of the things that has been troublesome in the system and some of the messaging has been very much about you know putting people off coming and seeking help and the earlier people seek help the more chance they have of not getting into difficulty so I would very much like to see a really positive messaging going out that actually encourages and makes people feel confident to come and get help early on even if they're just worried before it gets to any stage of actually being a difficulty. That relationship with the work coach is absolutely crucial and I'm constantly impressed when I go to job centres with the commitment of work coaches and I think many of the members have been to job centres with really committed staff, care deeply about the claimants and the customers and are really focused on building those partnerships with a full range of organisations locally but that's also very much a strong focus for the department from ministers, permanent secretary down over the last sort of year or so is to really build focus on those external partnerships so we can work together with other organisations for the benefit of the customer so a very strong focus from top to bottom of the department. Okay, any other questions, members? Can I move just to mop up one or two things there? Then one of the things that was raised by COSLA was in relation to their desire to see that automating the notification of annual rent increases from councils to the department working pensions for universal credit and removing the current requirement for claimants to notify DWP of their rent increase within the relevant assessment period. They said that this would protect rental payments for claimants and landlords. I like it, I want it. The one that is on the individual to notify the DWP of that show, there must be a more logical way of taking that forward that makes it easier for the DWP but actually protects the tenant and the landlord. Any thoughts around that? Yeah, so this year for the first time we've tried to use the landlord portal to do some of this process and so to make that much more automated but it's our first go and universal credit is one of those things where you do iterate and try and learn and improve so year on year but we've done this exercise in collaboration with a selection of social landlords so you know absolutely up for that and that's really where we're heading anyway. Okay, that's helpful and any update when you think we can get that because there's a direction of travel so I'll guess what you're saying Mr. You would like to see that happen but it's not as simple as saying let's just do it? Well we're partially doing it this year, towards the end of May I think is the date which will be then using the portal to upload data with the rent changes so that individuals won't then have to go on and do it for themselves and then be verified by the landlord which will be really you know laborious process and not efficient at all so that is happening this year for the first time but it's not the full-blown automated solution it's the first step towards that but it just shows you the sort of functionality that the portal will allow us to deploy as we improve it and add to it. In fact testing successfully that would be rolled out more widely and that would happen. We want to check in with the landlords that it's worked for them as well so we'll review it and then see how we can make a bed next year. You've probably heard in the last session where COSLA had told us in the written submission that local authorities are not advised by the WP of tenants or claimants whose payments have been reduced by the application of either the bedroom tax or the benefit cap in universal credit cases and could only provide such support when claimants come forward even when that support might be on offer and COSLA has previously raised the issue of that communication between local authorities and landlords and the DWP to make sure that they can step in as quickly and effectively as possible to offer a degree of support and that's not necessarily happening at the moment so they're continuing to make representations to yourselves. Where are we with that? Is that something you're minded to move on? Well we're working closely with Scottish Government colleagues to see how we can transfer information to them to local authorities so they can operate that more efficiently. Work is in hand. We haven't yet got a completed model for how that's going to happen but it's been discussing this for quite a while so how best we can get the information that's needed across. Until we do the automated solution for the spare room subsidy, we're doing all we can to help with a tactical solution. Are those discussions going on? I'm deliberately oversimplifying it for the purpose of the evidence session. Should that become possible, there's no reason why you would not want to do this, you want to do this, you're just trying to find a way to make sure that it can happen? Absolutely. Right. Okay. That's quite helpful. I suppose the final question may, I'm looking at my other members if they want to come in, there's a little bit of time to do so but I suppose my final question would be ideas and suggestions that the DWP has to how the social security system can better protect those at a risk of homelessness or are trapped within the homelessness system, be it in temporary accommodation, be it in hostels, you'll have heard us put on record some of the costs in relation to that temporary accommodation, the role that housing benefit plays within that and initiatives from DWP and the UK Government to try and capture some of the cash around that to do more in that area and at the same time the Scottish Government's efforts to kind of get a quantum around the amount of housing benefit in the system to see if there's a better way of using that. We have some concerns in relation to that, not compromising that an individual needs assessment and entitlement of claimants but there must surely be a better way of using money in the system and politicians are good at making suggestions. What would the suggestions be of the DWP to do some of that around homelessness? I think generally, you know, carry on the hard and good work we're doing around universal credit so the rollout but also recognising that everything's not perfect and keep trying to make it work even better to address any concerns and things like the landlord portal. I think the things that we've heard that are more kind of on the grounds really close working awareness amongst our work coaches and close working with crisis shelter and a whole range of other organisations that's really important. In terms of temporary accommodation and the cost there, we wouldn't support devolving those costs but absolutely we would be keen to explore further with a full range of stakeholders and other interests what could be done to operate more cost effectively and to get better outcomes from that system because it's not self-evident to me why some of the rents and temporary accommodation, you know, particularly where it's social sector accommodation, why they should be so high and so absolutely up for exploring with others what we could do to get better outcomes for the money that is spent on temporary accommodation through housing benefit. Okay, so open minded, I know a lot of these things become politician led, so you know, Secretary of State led and Scottish Government led and all those kind of things but DWP on the ground, you've got direct experience of how that money is, it isn't used well so it's important that the DWP has its own unique voice in relation to that out with the politicians that I understand that you are accountable towards but I'm just trying to make some space for that within my line of questioning. The clerking team is reminding me we haven't really interrogated some aspects of the local housing allowance which we really, really should do, so let's put some of that on the record before we draw this evidence session to an end. Can I ask how does the Department of Work and Pensions intend to upgrade the local housing allowance rates after the freeze ends in 2020? Would you agree with evidence that the freeze has resulted in the LHA no longer meeting the policy objective of covering the lowest 30 per cent of the rental market and if so, what exactly is the policy objective of LHA? You've heard part of that in the previous evidence session that I know, so what does the future hold from 2020 onwards? The policy objective of the LHA isn't to meet 30 per centile of the market, that was where it was set back in 2010 but that's just the parameter at that time. The policy objective is to make a substantial contribution to help people to meet their private renter sector housing costs, taking account of the needs of that family, the local rental market but also the needs of the taxpayer and fairness with other renters. That's the broad policy, absolutely. It's been frozen, as earlier evidence givers said. It's been frozen since 2016, all the rates have all been frozen since 2016 and were uprated in relatively low terms by CPI in the years before that, so in many areas they have fallen significantly below that 30th per centile point. What we're going to do from next year, we haven't decided yet, the Government hasn't decided yet but our sectorist date is very much on records. As having said, this is something that she will be talking to the chancellor about as part of the spending review discussions that we expect to happen over the next few months to see what we can do to change local housing allowance rates from April next year. So no announcements from me, you won't be surprised to hear today but definitely plans to look very hard at this and talk very hard with the treasurer and the chancellor over the coming months. You would have concerns, I assume, that some of the local housing allowances don't even provide enough money to reach that 30th per centile, so that would be of concern to you and you're raising those concerns with Government. There's no particular magic about the 30th per centile. I think it's something like 25 per cent of the private sector in Scotland is on housing benefits. The 30th per centile isn't a magical point, it was 50 per cent before that, 30 per cent. Am I concerned that some people, the amount that will pay through the LHA is very well below that 30th per centile point, that there is a very small proportion of the market that is affordable to them? That is the sort of analysis and evidence that we will feed into the treasury when we talk to them to try to get an agreement through the spending review for next year and beyond. I thank you for that answer, Mr Sir. That's as close as I think I'm going to get you to say that you have concerns in that, but I take on board the point that you're making. Can I ask what assessment the DWP has made of the impact of reducing the shared room rate to under 35s? Would you agree that much of the evidence that the committee has heard and that a particular problem for young people finding affordable accommodation, particularly their lower benefit rates that they get in lower earnings on occasions as well? Are there any plans to review the age to what the shared room rate applies or to extend exemptions? Again, we heard some of that this morning in the earlier evidence session, so any comments or information that you can give the committee on that? No plans. In terms of comments, I think that we would feed that into our broader look at the local housing allowance rates that we will be discussing with Treasury ahead of next year, but we are in constant communication with crisis and a whole range of other organisations about various different strains and stresses in the system and what the exemptions might be. We hear loud and clear that concern, particularly around the move up from 25 to 35, so we're aware of it. It will feature in our discussions with the Treasury. Beyond that, I couldn't comment. Okay. I guess that's the closest we're getting. Alison Johnstone has been able to come back on that. Alison Johnstone was highlighting that next question in the earlier evidence session. The committee has heard evidence that the broad rental market areas are too wide to reflect wide variations in rents. In some areas, for example in Edinburgh, is there a case for reviewing the broad rental market areas? There are always different systems that one could look at. We don't have any plans to review the broad rental market areas. Again, as previous witnesses have said, they've been in place for a long time. Actually, if you did change the broad rental market areas, you'd suddenly find that you'd have some winners, but you'd also have significant losers, so any major reform has quite a big impact on the system. I'm not sure it would really address the issues that we're concerned about. You'd also find that if you went down to a much narrower area, the problems that were highlighted earlier on about having very small numbers of rents to look at to judge what the right local housing allowance should be in an area, you'd end up with one or two or three that really wouldn't be productive. No plans to look at that in the future. That might not be what everyone wants to hear, but it's very helpful that you put that on the record, and I'm minded that you do plan to raise the 30 per cent issue with the UK Government and that you will discuss again that under 35s shared-room issues with the UK Government, but not the broad rental market areas. He's hoping that those first two matters that you will be discussing with Government means there may be some movement there, but thank you for putting that on the record. Before we close this evidence session, is there anything that our witnesses want to put on the record before we close? No, thank you very much. Okay. As always, thank you very much for coming along and supporting the work of the Social Security Committee. We very much appreciate it. That ends agenda item 2. We now move to agenda item 3, but we'll suspend briefly before we do that. Thank you, agenda item 3. Okay, welcome back. Everyone, we now move to agenda item 3, which is an item on pension credit. Can the refer members to paper 4? Note by the clarity correspondence from the UK Government, Scottish Government and Citizens Advice Scotland. At our meeting on the 7th of March 2019, the committee received evidence from Citizens Advice Scotland and Age Scotland on the forthcoming changes to eligibility for pension credit. The changes are due to take effect from the 15th of May 2019. Citizens Advice Scotland has provided supplementary information to the committee. Following this meeting, the committee agreed to write to both the Scottish Government and the UK Government on the responses that have now been received, which have been circulated. I will now ask for the committee's comments on those replies that were made on the record, some of my thoughts in relation to them at the moment. I do remain dissatisfied with the UK Government position not only on the policy, which the Scottish Government and their reply to us estimate will impact on 3,800 mixed pensioner households by the year 2021-22 to the tune of around £20.8 million, but also the rationale for implementing the policy is estimated that that could impact households of up to £7,000. Each income guarantee for pension credit is £12,940, but for universal credit it is £5,990. I think that most people can see that there is quite a stark difference there. The Scottish Government and their reply noted that that may also impact some waspy women also. In relation to the policy intent, Guy Opperman, MP Minister for Pensions, and I thank Guy for reply to us said that it is important to be clear that this is about making sure that all working-age people irrespective of their partner's age are subject to the same labour market approach and that taxpayer support is directed to where it is needed most. That is the policy intent, and that is a reserved issue. I find it fanciful that what we are doing is treating various pensioner households differently. The policy intent to keep working households the same actually gives a variation in how we are treating pensioner households into the significant detriment of many pensioner households. That would be my thoughts in relation to the reality of what the policy intent wishes to achieve. We also specifically asked the UK Government about conditionality and sanctions that might apply to households where there is a pensioner and a non-pensioner in the same household claiming universal credit and whether or not they may be subject to conditionality or sanction. In the reply, we got pensioners and mixed-age couples claiming universal credit will not be subject to any work-related conditionality rules. However, conditionality for the working-age partner will be tailored to meet their specific circumstances just as it would be for any other claimant. I do have a concern that there could be a double detriment to some of those households where they could be losing up to £7,000 a year, but the working-age individual who may have responsibilities in that household could also find themselves in theory and admit that it is in theory subject to conditionality, which could lead to sanction. The committee spoke quite a lot about particularly our last inquiry in relation to those that are moving from the tax credit system over to universal credit and whether conditionality or sanction should apply to those. The majority of the committee thought that that would not be an appropriate thing to do. I accept that we are not going to change the policy position of the UK Government on that, even though the majority of the committee may disagree with the UK Government's policy position. However, I wonder if there is scope as a committee to come together and go back to the UK Government and say that we are disappointed that they are restating that policy position that we would ask that they again review the conditionality arrangements for mixed pensioner households, just to reassure ourselves that those households do not get a double detriment by the reforms that have been brought in on the 15th of May. That is my personal view. I want to set it out and it is only appropriate that we have a discussion as a committee based on all the replies that we have received. Are there any comments on the replies that we have received or any thoughts? I think that rules should be consistent. I have always felt that whatever you are talking about, so if you are of working age, your rules should be consistent. You should not be subject to a different set of rules because your partner happens to be older. That is my position. I agree with the point that you made, convener, but I would go a bit further. The point that I raised during the pre-meeting discussion was about potential moves to go further than that because the Minister for Pensions and Financial Inclusion said at the end of his letter that he is talking about, apparently, action that helps to alleviate levels of pension or poverty, and he mentions a triple lock. What I had asked before was about reports that the triple lock was now under threat, and it actually comes from a committee of peers, including somebody who rejoices in the name of Lord True, Tory Peer, who is talking about taking away free pension or bus travel, which could only apply to England and Wales, presumably, winter fuel allowances, and reopening the triple lock, as well as TV licences being paid for by over 75. It seems to me that that is, as yet, only the recommendation of this committee, but that is often where these things start off. There is also David Willits, Lord Willits, of two brains, presumably, who has also made a similar recommendation. My worry is that, despite the fact that the minister is saying that they remain committed to a triple lock, we will start to see a much more broad-based attack on pensioners. The rationale that is given for it in these reports is that it is unfair, it is about intergenerational fairness. Pensioners are too well off compared to young people, which is a false dichotomy. I think that what I would like to see is probably a complete waste of time, because the UK Government does not see fit to come to these committees anymore, but to ask the minister to come to explain, to confirm, to reassure that the triple lock and those other potential attacks on pensioners form no part of UK Government policy. That is fundamental to the social security of pensioners in Scotland, and I think that this committee should be interested in it. Mark will take it in a second. Just for clarity then, whatever we do correspond back to the UK Government minister for pensions, your suggestion is part of that correspondence. We should invite them to committee to address some of those concerns. I think that the reply is very disappointing to say the least. I think that the priority of the UK Government should be addressing the scandulously low uptake of pension credit at 40 per cent. There are 60 per cent of pensioners in the UK living in poverty because they are not uptake in their right to pension credit, which is one of the key drivers of lifting pensioners out of poverty over the last 20 years. That should be the Government's priority. However, if we are talking about actions off the back of this disappointing response, I would agree with a request to the minister to come and speak to us and, at the very least, to keep a track of the impact of the number of pensioners that this policy pushes into poverty. The policy objective of universal credit is to encourage people to seek more hours or better paying work to increase their household's income. What this policy is asking a household to do is to ask one household member to increase the value of their work or the number of hours that they undertake to cover for two people's incomes. I do not know how many extra hours that is going to take a working-age person to have to undertake. How many hours in the week does the UK Government expect someone to work to support their pension age partner because of that decision? I would support any measure of getting the minister here to answer some of those questions. Any other comments on that, Jeremy? I find disappointment in regard to both letters that we still have 60 per cent of people who are not taking up this benefit, who will come with 15 of me if they can get on before 50 meet will get the benefit. I think that there is a lack of awareness when you talk to people about this happening. I do wonder whether we should go back to both Governments. Clearly, we have not got very long, but I do think that there needs to be something out there within the media, within some kind of telling people that this is happening. Whatever you view of it right along, only 40 per cent of people are taking it up. The overall majority are not. I appreciate that I do my financial health check, but letting people know that this is happening seems to be an issue that no one has really grasped. With so much else going on in society, media and politics, this has just not been talked about. I do not know whether we, as a social security committee, can do something with a press release, something just to say that this is happening on 15 May. We have only got what is it, 19 days left, whatever, to do something about it. In regard to your first decision, I think that I am awesome. Why are we making a differential just because of someone's age? I think that is not right. I would not support the thing that you would put into your letter, but I think that there is a bigger, broader issue here. We have only got a couple of weeks left before it happens. Can we, as a committee, put something out on to social media, on to the general media, just to say that this is happening? Let us focus first of all on where there is agreement. I think that we can agree that we should seek to publicise the issue that people will lose out if they do not claim before 15 May. I think that, as a convener, we can make sure that we do that in whatever correspondence, whether by majority or unanimously, whatever correspondence we put to both Scottish and European Governments, we will make sure that that is stressed within that as well. Can I push me a little bit further on that, Mr Balfour? I am just wondering if there are people out there who, clearly after 15 May, had that underlying entitlement, because 60 per cent of people who have that entitlement now are not claiming it. There is no reason why the UK Government could, if someone claims after 15 May, but had that underlying entitlement before 15 May, they could not exceed to giving them their pension credit cover. That would be a reasonable thing to do. I suppose that you have to draw a line somewhere. I think that there has been a failure on, frankly, both Governments. This has all to do with so many other things going on in politics, but this decision has not been got out. I am not sure that I am saying which is beyond it. I think that we as a committee have raised this as an issue. We have a number of days left before it comes into place. Let's at least unite around one issue that we can tell people. Whether that is through the Scottish Parliament website, through some kind of press release to the general media or whatever, that is what I am suggesting. I do not have your support for the second aspect of that, but the first aspect, let's assume that we are just going to do that anyway, Jeremy. We will make sure that that happens. Keith, then Mark. On the very narrow point, I agree with Jeremy that we should try to make this as widely known as possible. I do not agree. I think that it is a frankly ridiculous proposition that is somehow the fault of the Scottish Government in any way whatsoever, but that is politics for you. I also have some difficulty with the idea that we should try to warn people that it is about to happen, but pretend that it is a good thing that is happening anyway. I do not understand the logic in that. In doing that, in publicising that, I agree with Jeremy's point about take-up and the point that Mark made. However, the language that Jeremy used—I am sure that it was inadvertent about this being a benefit—is part of the problem, because the UK Government is now moving towards describing various pension entitlements as benefits, on pensions as benefits. We know that that is a distant centre for people to claim them, because there is, especially among older people, a thing about saying that I am going to get a benefit compared to what is entitled to them. We all know that, but they have a thing about that, whereas pensions, they see it as an absolute entitlement. I think that we have to be clear that that is about pensions, not about benefits. Of course, it affects benefits as well. On the narrow point, I do not reside from anything that I said previously. I think that we should write to the UK Government in terms that the convener has described with those additional points that I would want to make. However, I do agree with the point that we should publicise that as widely as possible, because it will have an impact on people's lives. On your subsequent point, convener, I do not know if that is what the 13th of August deadline refers to, or is that a different thing? I say that you can make a backdated claim up to the 13th of August in paragraph 3 of the minister's letter. I suppose that the danger of promoting that is that people might just wait—I have got longer to wait—before I seek to claim, but it is whether or not that becomes the next line in the sand, I suppose. That is something to consider. Mark, do you want to come in? I think that there is general consensus around the tables that that is not well known about at all. I think that that is a consequence of when the decision was announced. I think that it was on one in the meaningful votes day or a vote of confidence day that it was announced. Even if we are writing back to the minister, we could potentially include a request for it to be delayed by six months or whatever the committee can coalesce around to give people more time to make people aware of their entitlement and a chance to apply before they remove the support. I think that that is a very constructive suggestion, because we unfortunately did the nature of politics, did we not? We did split on this when we did our initial letters, but the suggestion is that without having more individual views about the policy intent of this word, we would just disagree. We asked for a six-month extension to both the 15th of May deadline and the 13th of August deadline, where both Governments do all they can to maximise benefit uptake in relation to this, which is sitting at 40 per cent. Do you think that we could coalesce around that as a committee? I suppose that I am looking at Michelle and Jeremy, because I suspect that other members can coalesce around that position. I am just wondering if that is a position that we are concerned about if colleagues could coalesce around. I do not know what to think really. I mean, it was announced years ago. It has just been re-raised recently, reminded recently that it was happening. I think that there has been obviously very poor take-up, the clarity of why. Some people obviously do not feel the need it, others people are totally unaware of it. Some people, as Keith Brown has indicated, may feel for pride reasons or feelings of discomfort about going to the benefit system that they do not want to claim it. It is complicated. It is a reserved matter. Really, it is our colleagues in Westminster that should be talking to the Government around if they feel that there is a need. I do not know whether there has been a clamour down there. I am not aware of it. I do not know that, when I was writing at this point, this juncture is going to actually make any difference. I mean, I do not want to—I want to try and get the consensus that we are trying to secure. I am conscious times against this as well here. Without going down the road of what is reserved, of what is devolved, inter-income maximisation and tackling poverty, this committee absolutely has a role to play in how the social security system does or does not support that. You were very close to being minded to support that six-month extension, Michelle. It is too late, it is my view. If this was something that really bothered you, this should have been done ages ago. I think that the point that I would make is that, as soon as this was drawn to the attention of this committee, we have moved speedily and effectively and efficiently on this. I am not going to speak ill of previous members of this committee or conserve other Labour Party politicians at Westminster. What I want to focus on is mixed pensioner households who are at threat right now, and we want to try to protect them and drive up that 40 per cent claimant rate as much as possible. So, even though you suspect that it may not be a successful move, Michelle, can I ask whether you would support a letter of call for that extension? I will support a letter that says that we are concerned that there has been a very low rate of take-up on this benefit and that there has not been sufficient information out there. If you want to call the Government delay it, do I care one with the other? Probably not, if I am really honest, because I am not sure that you will necessarily get a rush of take-up unless you do some really good work around advertising it. If you want to write, that is fine. Can I thank you for that, because that means that we have got consensus on that, Jeremy? Can I just check with yourself? Can we work the letter in an appropriate fashion that keeps all members of the committee satisfied? Of course, in terms of that take-up of an entitlement, I do not distinguish between Scottish Government, UK Government or local authorities for that matter as well, so let us make sure that we draw attention to all levels of government in relation to that. A six-month extension from the UK Government of the May date in the August date would give us a window to get that 40 per cent figure increase and protect some mixed pensioner households, and I am delighted that we will be able to agree on that. Are we going to be contained in the letter as well? Well, we have not written the letter. We are discussing what the key principles will be, I think, to give comfort to our Conservative members of the committee where we have got agreement. We have to note where there is a majority view and not the full committee to some of that stuff, but we will make sure that the content is included within it. It does refer to the minister's letter and takes up the point with the triple lock. I think that that is important, and we should respond to that. I think that it is also true to say that we can't... That is a different issue. If you want to explore that, you can go on and read more of that letter. It is a wider issue. What I would suggest is that if we are asking the minister to come to the committee, that is an opportunity to speak more widely about that. I think that we should... We are not drafting a letter by committee. Just now we have to give the general principles of that letter, then you just have to empower me with the class to get it written and sent. Let's make sure that we note it. We invite the minister to our committee, and we call for that a six-month extension of what we know to actually coalesce across part of political grounds. Can I suggest that if that concludes this particular agenda item, we are going to have to not move to agenda item 4, but just to close the meeting at that point and to return to our consideration of the evidence that we have heard this morning? I am not going to discuss item 4, but we are still in public at the moment. I tried to get in at the very end with a question of information from the people that gave evidence, so if we can raise it that way. Michelle Ballantyne has quoted Clotmanshire Council as having rental rears, universal credit rears, which have gone up as a result of the introduction of universal credit and going down. That is not my understanding based on the figures that I have from Clotmanshire Council, so it is useful to have from the people that were here their version of that. We have moved on to consideration of evidence, which would normally be in private. You have put that on the record. Let us look at that next week when we discussed that information in private. I think that is only reasonable. We will not move to agenda item 4. We will close the meeting at that point.