Response to the Draft Equality and Impact Assessment Draft Department for Communities Budget 2021-22
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Response to the Draft Equality and Impact Assessment Draft Department for
Communities Budget 2021-22
Introduction
1. The Cliff Edge NI Coalition welcomes the opportunity to contribute to the Department for
Communities Equality Impact Assessment relating to the draft budget allocations for 2021-
22. The Coalition comprises a broad range of over 100 organisations who have come
together to campaign for the welfare reform mitigations to be extended indefinitely and
strengthened to address new challenges such as Universal Credit (particularly the five-week
wait and the two-child policy) and cuts to housing benefits in the private rented sector.
2. The current mitigation package (agreed as part of the Fresh Start Agreement in 2015) has
been extended on several occasions in the absence of legislation. The Coalition is concerned
about the hesitancy to enshrine the mitigations in legislation, despite the commitment
within the New Decade, New Approach agreement, which has created a recurring 'cliff
edge'.1 It is important that people impacted by welfare reform in NI can rely on accessing the
support they need into the future, at the minute there is no such certainly. It is also critical
that the mitigations package remains relevant to the constantly developing social security
system.
3. The draft budget allocates £42.8million to the Department for Communities for welfare
mitigations. The Coalition are pleased to see that budget has been allocated for the
continuation of the current mitigations package. We also welcome confirmation that the
loopholes relating to the Benefit Cap and Social Sector Size Criteria will be closed to ensure
that everyone in Northern Ireland is protected from the impact of these policies.
4. This paper responds to the specific queries posed by the Department for Communities
Equality Impact Assessment with a particular focus on urgent priorities identified by the Cliff
Edge Coalition.
Question 1: Are there any data, needs or issues in relation to any of the Section 75 equality
categories that have not been identified in Section 5 of the EQIA consultation document? If so,
what are they? Please provide details.
5. No comment.
Question 2: Are there any adverse impacts in relation to any of the Section 75 equality groups that
have not been identified in section 6 of the EQIA Consultation document? If so, what are they?
6. The Coalition has been consistently asking for the welfare mitigations package to be
extended to protect those impacted by new policies and a context that has changed since
the original package was introduced in 2016. The operating environment of social security,
and the welfare reform mitigations package within that, has changed significantly due to the
roll out of Universal Credit and the ongoing impact of the Covid-19 pandemic. We strongly
recommend that funding is secured to strengthen the mitigations package to address new
1 New Decade, New Approach agreement, p.9.
1challenges such as the Universal Credit five-week wait, the Two-Child limit and cuts to
housing benefits in the private rented sector. We are concerned about the impact of failure
to strengthen the mitigations package in this way on several s75 equality groups as will be
detailed below.
7. The Coalition welcomes the fact that the Department submitted a bid of £57.7million for a
range of new mitigations that had been recommended by the NI Human Rights Commission
to allocate additional support for people impacted by Welfare Reform and £28.8million to
offset the Two-Child Policy.2 It is deeply disappointing that these bids were not met as the
Draft Budget provides no allocation to fulfil those commitments outlined in the New Decade
New Approach. A failure to adequately support people through the social security system
will impact upon other elements of the public purse such as the healthcare system. These
are costs which can be long-term and expensive therefore not allocating funds to prevent
poverty is a false economy.
8. In addition to below was it outlined below; the Coalition is concerned about the proposed
£1.5million cut to the Advice Sector contained within the draft budget. This proposed cut is
taking place in the context of the adverse economic implications of the Covid-19 pandemic
and the ongoing transition to Universal Credit. The provision of independent advice and
tribunal representation is paramount to ensuring current and future claimants (such as
those who will have to turn to Universal Credit for support at the end of the Coronavirus Job
Retention Scheme) can access their rights and entitlements.
9. The Coalition welcomes the Minister for Communities’ acknowledgment of the advice
sector’s critical role in supporting people in need in NI and her commitment to ensuring that
the advice sector funding continues.3 We trust that this commitment will translate into a
sufficient budget allocation for the independent advice sector, thus safeguarding access to
critical advice for people in NI from across the s.75 groups.
Universal Credit – the five-week wait for first payment
10. The Cliff Edge Coalition is asking that all UC claimants are offered a one-off supplementary
payment when moving onto UC to mitigate against the short, and long-term, impact of the
five-week wait on households. We are therefore concerned about the lack of funding in the
draft budget to strengthen the mitigations package in this regard.
11. Since its introduction in September 2017 the roll out of Universal Credit (UC) has presented
new challenges for the social security system in NI. The Department for Communities (DfC)
data indicates that, although there are some ‘winners’ under UC, many experience a
2 We would like clarification on this figure because despite stating that the Department bid for the amounts recommended
in the NIHRC report, the actual recommendation to offset the 2-child limit in relation to UC, Housing Benefit and Child Tax
Credits was significantly more, estimated at £56million (Cumulative impact assessment of tax and social security reforms in
Northern Ireland (November 2019) Table 8.1 p.109).
3 Twitter @DeirdreHargey 2nd Feb 2021. See also https://www.communities-ni.gov.uk/news/hargey-resources-will-be-
targeted-those-most-need.
2considerable drop in income.4 In addition, some of the worst impacts of welfare reform have
been mitigated by flexibilities for example direct payments to landlords5 and twice monthly
payments to claimants.6
12. The five-week wait for the first UC payment has consistently been linked to hardship, debt7
and an increased reliance on foodbanks.8 A consequence of the pandemic has been a rapid
increase in the number of households relying on Universal Credit. Three-in-ten families who
started claiming UC because of the pandemic are more in debt than they were in February
2020.9 With the planned cessation of the Coronavirus Job Retention Scheme the figure is
likely to jump again.
13. The UC Contingency Fund (‘the fund’) was introduced in 2017 to “make emergency
payments where hardship occurs as a result of difficulties which are not due to any fault on
the part of the claimants.” i.e. the five-week wait.10 Despite widespread condemnation of
the five-week wait, including from the Westminster Committee for Work and Pensions,11
this valuable fund has consistently underspent the £2million per year allocated. In
November 2017 to March 2020 a total of £1.5 million was awarded to 9,120 people. In the
period 1 April to 31 December 2020 a total of just over £1 million was paid to 3,473 people.12
Reasons for this include restrictive eligibility criteria and a lack of widespread awareness of
the scheme.13 Whilst its continuation in the draft budget is welcomed, the fund needs a
significant overhaul to address the impact of the five-week wait more adequately.
14. Finally, we are concerned that the department has not been provided with an allocation to
finalise the recruitment process of additional staff. Additional staff are urgently required to
assist with the administration of new UC claims. We heard departmental officials confirm to
the Communities Committee that the five-week wait could increase to 6 or 7 weeks,
increasing debt and hardship, and ultimately poverty for thousands of claimants.
4 Discounting transitional protection and any NI mitigation payments, 2018/19 estimates suggest that 114,000 households
will experience an increased entitlement (average £26 per week), 126,000 will experience reduced entitlement (average
£39 per week), with 72,000 households unchanged. This equates to an overall decrease in entitlements of approximately
£105,000,000 per annum. See NI Audit Office ‘Welfare Reforms in Northern Ireland’ (17 January 2019) p41 https://www.NI
auditoffice.gov.uk/sites/NIao/files/mediafiles/Welfare%20Reform%20Report%202019.pdf; See also Appendix 2, Case
Study 1.
5 While the direct payment of UC Housing Costs to Landlords is a welcome flexibility, we are concerned about ongoing
operational issues. Despite this flexibility, UC statistics released in August show that 47% of the 25,280 households
receiving Universal Credit to help with their housing costs in the private rented sector were having payments of rent
benefits made directly to them and not to the landlord. This is an increase of 4% points from the previous statistical release
covering February 2020.
6 NI Housing Executive, ‘Welfare Reform in Northern Ireland: A Scoping Report’ (November 2018), p9.
7R.Patrick, M.Simpson ‘Universal Credit Could Be A Lifeline to People in Northern Ireland, but it must be designed with
people who use it’ (June 2020) p.13.
8 Trussell Trust ‘Five Weeks Too Long’ (September 2019).
9 Resolution Foundation ‘The Debt That Divides Us’ (February 2021).
10 Welfare Reform Mitigations Working Group, ‘Welfare Reform Mitigations Working Group Report’ (Jan 2016) p14
(accessed May 2019).
11 House of Commons, Committee for Work and Pensions Inquiry ‘Universal Credit: the wait for first payment’ (2020).
12 https://www.communitiesni.gov.uk/sites/default/files/publications/communities/dfc-annual-report-
welfaresupplementary-payments-discretionary-support-standards-of-advice-assistance-andsanctions-annual-report-2019-
20.pdf
13 See https://www.niauditoffice.gov.uk/sites/niao/files/media-files/Welfare%20Reform%20Report%202019.pdf
3Impact on women and persons with dependents (women)
15. We believe that a lack of funding to strengthen the mitigations package, to mitigate the UC
five-week wait, will disproportionately impact upon women and that this should have been
identified within the Department for Communities’ EQIA. There are several reasons for this
namely that women are more likely to claim social security benefits,14 welfare reform has
impacted more on women15 and Covid19 has increased the numbers of people relying on
social security benefits many of whom will be women.16
16. The impact of this is made difficult to quantify due to a lack of statistics broken down by
gender particularly in relation to Universal Credit. However, latest figures available show
28% of Universal Credit claimants were lone parents17 (91% of lone parents are women).18
Equality statistics on the mitigation payments themselves show that these were paid to
more women than men.19
Universal Credit – Two-Child Policy
17. The Cliff Edge has been calling for the abolition of the two-child policy and that, failing that,
specific measures be introduced by the NI Executive to mitigate against its impact. It is
disappointing that the draft budget contains no funding to mitigate this harmful policy
despite statements by the Minister for Communities that recognise the urgency by stating
that it was ‘the priority consideration’ for future welfare mitigation measures.20
18. The child element of Universal Credit has replaced Child Tax Credit which, prior to April
2017, was available for all children in low-income families. Third (or additional) children born
after 6 April 2017 now only qualify for Universal Credit support in a small number of
exceptional cases.21 Families unable to claim Universal Credit for a third, or additional child,
will lose out on £2,780 per child, per year. In August 2020 there were 2,730 households in NI
impacted by the policy.22
14 Statistics published by the Department of Work and Pensions for England, Scotland and Wales indicate in January 2021,
52% of Universal Credit Claimants were women and 48% were men. In January 2020 prior to economic impacts of the
covid-19 pandemic, 57% of claimants were women and 43% were men. No comparable statistics are published by the
Department for Communities. Department of Work and Pensions statics are available at https://stat-xplore.dwp.gov.uk/
15 The House of Commons Library reported that 86% of the savings to the Treasury from the tax and benefit changes since
2010 will have come from women. See R.Cracknell, R.Keen, Commons Briefing Papers SN06758, ‘Estimating the gender
impact of tax and benefit changes’ (December 2017).
16 DfC statistics show an 98% increase in Universal Credit claims between February 2020 (57,920) and August 2020
(114,530).
17 Northern Ireland Benefits Statistics Summary, DfC & NISRA, August 2020
NI Benefits Statistics Summary - August 2020 (communities-ni.gov.uk)
18 2011 Census stated 91.2% of lone parent households in Northern Ireland were headed by women.
19 Northern Ireland Welfare Supplementary Payment Schemes, Section 75 statistics November 2017 to April 2019, DfC
https://www.communities-ni.gov.uk/publications/welfare-supplementary-payments-discretionary-support-standards-
advice-assistance-and-sanctions
20 AQW 13628/17-22 Answered 2nd February 2021.
21 Such as those in-work and privately renting (particularly in expensive cities). See Institute for Fiscal Studies ‘Universal
credit and its impact on household incomes: the long and the short of it’ (April 2019).
22 AQW 13618/17-22 – Answered 2nd February 2021.
419. The impact of the two-child policy means that a family with three or of more children will be
financially disadvantaged by £2,780 per year per child for their third (or additional child).23
This will deepen the impact of poverty in NI. Already 24% (a 5% rise in a 12 month period) of
children in NI are living in relative poverty and the problem is forecast to increase.24 The
Institute of Fiscal Studies has projected that between 2012 and 2020, relative child poverty
in NI will increase by 5.5% and absolute child poverty by 7.3% (compared to an increase in
relative child poverty in the UK as a whole of 3.6% and in absolute child poverty of 5%).25 It is
likely that those figures will be updated, for the worse, as a result of Covid-19.
Impact on multiple Section 75 groups
20. Regarding this consultation, the Coalition is concerned that the inability to mitigate against
the two-child policy will have a disproportionate impact on women, children, and persons
with dependents.
21. This policy may also disproportionately affect families from specific religious beliefs and
racial groups where there is a trend for bigger families. The report following a joint inquiry
into welfare policy in Northern Ireland in 2019 by the Westminster Northern Ireland Affairs
Committee and Work and Pensions Committees highlighted “the limit may discriminate
against particular communities, especially Catholic communities”26. The average household
size in Northern Ireland when categorised by religion is 2.72 for Catholics and 2.41 for
Protestants.27 This was not reflected in the Equality Impact Assessment and should be
considered going forward. There are twice as many large families in poverty in NI as there
are in Scotland and the South West of the UK.28
22. The impact of the two-child policy in NI is of particular concern given family size. Evidence
from the Children’s Commissioner is that the two-child policy in NI has affected an estimated
2,518 families in 2017-18, which equates to at least 7,500 children. It is estimated that this
will rise to 11,870 families and at least 35,610 children affected in 2019-20, again these
estimates were developed before the onset of the Coronavirus pandemic.29 Despite a
change in the law in 2019 abortion services have yet to be commissioned so that in practical
terms abortion is not available in most circumstances in NI and accordingly, women in NI are
likely to be impacted by this policy to a greater extent than women in GB.30
23 Where any of the children were born following 6 April 2017, in comparison to families with children born before the
introduction of the limit. See NI Commissioner for Children and Young People (NICCY), ‘Submission to Special Rapporteur
on Extreme Poverty and Human Rights prior to visit to the United Kingdom of Great Britain and NI in November 2018’ (4
September 2018) p5 https://www.niccy.org/media/3133/NI ccy-submission-to-sr-onextreme-poverty-14-sept-18.pdf.
24 Poverty Bulletin: Northern Ireland 2018/19.
25 Institute for Fiscal Studies, ‘Child and Working-Age Poverty in Northern Ireland from 2010 to 2020- an update’ (2014) p23
https://www.ifs.org.uk/uploads/publications/bns/BN154.pdf
26 House of Commons Work and Pensions and Northern Ireland Affairs Committees, Welfare policy in Northern Ireland,
2019, https://publications.parliament.uk/pa/cm201719/cmselect/cmniaf/2100/210003.htm
27 https://www.ninis2.nisra.gov.uk/public/SearchResults.aspx?sk=DC2421NI
28 A Hood and T Waters, ‘Living standards, poverty and inequality in the UK: 2017-2018 to 2012-22 (IFS, 2017)
https://www.ifs.org.uk/uploads/publications/comms/R136.pdf
29 NI Commissioner for Children and Young People (NICCY), ‘Submission to Special Rapporteur on Extreme Poverty and
Human Rights prior to visit to the UNI ted Kingdom of Great Britain and NI in November 2018’ (4 September 2018) p5
https://www.NI ccy.org/media/3133/NI ccy-submission-to-sr-on-extreme-poverty-14-sept18.pdf.
30 Northern Ireland (Executive Formation etc) Act 2019 .
5Cuts to housing benefits in the private rented sector
23. The Cliff Edge Coalition have been calling for a strengthened package to include protection for
low-income private renters impacted by cuts to housing benefits31 over the past decade, paid
at the Local Housing Allowance (LHA) rate. The impact of these cuts is evidenced in the fact
that there are significantly more households at-risk-of-poverty after housing costs in the
private rented sector (PRS) in NI than in the social rented sector,32 and the fact that loss of
rented accommodation has consistently been among the top causes of homelessness in NI.33
We there therefore concerned about the lack of budget to strengthen the welfare mitigations
package to protect low-income private renters.
24. Whilst a welcome step was taken in response to the Covid-19 crisis to restore the LHA rate to
cover the cheapest 30% of market rents, there continues to be a significant shortfall for many
between their rent and the amount of housing benefits they receive.34 Furthermore, while
rents are increasing in the PRS,35 the LHA rate will be frozen from April 2021. This means that
shortfalls between rent and housing benefits will increase further.
25. In terms of the Equality Impact Assessment, we are concerned about the impact of this
decision on three s75 groups; persons of different age (given the impact on young people
under the age of 35), persons with dependents and women (given the impact on single
parents, 91% of whom are female).
26. The PRS in NI has grown significantly from 8% of all households in 2003 to 19% in 2019.36 This
has been driven by an increase in young people and single parent households living in the PRS,
many of whom rely on housing benefits and are therefore impacted by cuts to the LHA rate.
27. Persons of different ages - Impact on young people: The proportion of young people living in
the private rented sector has increased significantly over recent years with 41% of young
people aged 25- 34 living in the PRS by 2019 (compared to 18% in 2003).37 Over half of those
employed in the gig economy are under 3538 and young workers are more likely to be
employed in sectors which have been affected by job loss or reduced hours as a result of
Covid-19.39 This group are therefore more likely to be relying on housing benefits to pay their
rent. Furthermore, young people are impacted by one of the most acute LHA cuts, the Shared
Accommodation Rate. This means that single people under 35 living in the PRS are usually
only entitled to housing benefits to cover a single room in a shared property. Those living
31 Housing benefits here refers both to Housing Benefit and Universal Credit Housing Costs
32 https://www.nerinstitute.net/sites/default/files/research/2019/neri_working_paper_housing_final.pdf
33 https://www.niauditoffice.gov.uk/sites/niao/files/media-
files/Homelessness%20in%20Northern%20Ireland%20Full%20Report_0.pdf
34 Housing Rights have estimated this shortfall to be over £75 per month
35 https://insights.propertypal.com/flash-commentary/
36 https://www.communities-ni.gov.uk/system/files/publications/communities/frs-201819.pdf
37 https://www.communities-ni.gov.uk/system/files/publications/communities/frs-201819.pdf
38https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/687553/The_chara
cteristics_of_those_in_the_gig_economy.pdf
39 J Buchanan, PropertyPal (2020) analysis of ONS Business Impact of Covid-19 Survey
6alone therefore face a significant shortfall between their rent and the amount of housing
benefits they receive.40
28. Persons with dependents and women: Impact on single parents: Single parents (91% of whom
are female) are also disproportionately impacted by cuts to the LHA rate. By 2019, 45% of
single parent households were living in the PRS (compared to 23% in 2003).41 Single parent
households are more likely to be impacted by poverty and are therefore more likely to be in
need of support to pay for their housing costs.42 Furthermore, women with children have been
disproportionately affected by reduced hours and earnings as a result of the pandemic.43
Single parents are also more likely to live in 2-bedroom properties and the rents for these
types of properties have increased disproportionately from other types of properties, 44
particularly at the lower end of the market, which would be the properties which low income
single parent households are more likely to occupy. This suggests that single parent
households will be more adversely affected by any cuts to the LHA rates.
Question 3: Please state what action you think could be taken to reduce or eliminate any adverse
impacts in allocation of the Department’s draft budget?
29. The current flat rate budget, without a commitment by the Secretary of State to approve the
NDNA funding and with extremely limited Covid-19 relief funding, will result in unparalleled
adverse impacts on the most vulnerable people in Northern Ireland. We urge the NIO and NI
Executive to urgently consider alternative policies, in the form of additional funding, to
address the adverse impacts that are apparent under the proposed budget allocation.
30. If these resources cannot be secured, we urge DfC to consider mitigating measures which
prioritise protecting vulnerable households in Northern Ireland. Examples of steps that could
be taken to reduce or eliminate adverse impacts of a draft budget include:
a. Urgently draft legislation to extend the existing mitigations and ensure that the
welfare reform package continues indefinitely.
b. Take steps to ensure that the Benefit Cap and Social Sector Size Criteria loopholes
are closed as allowed for within the draft budget (highlighted in the Equality Impact
Assessment at para.4.10).
40 Of the 4,872 households entitled to the shared accommodation rate in 2017, the majority were actually living in one-
bedroom properties - https://www.nihe.gov.uk/Documents/Research/Welfare-reform-BRMA/northern-ireland-broad-
rental-market-areas-scoping.aspx
41 There was a corresponding decrease in the proportion of single parent households living in the social rented sector from
(from 52% in 2003 to 34% in 2019) - Family Resource Survey 2019
42 Whilst people living in single parent households make up around 9% of the population, they are over-represented in
households below the poverty threshold (after housing costs) – 17% of individuals in poverty are living in single parent
households. https://www.communities-ni.gov.uk/publications/households-below-average-income-northern-ireland-
201819
43 NERI blog post ‘Women’s Livelihoods Must Not Be Sacrificed After Lockdown’ (August 2020).
44https://www.housingrights.org.uk/sites/default/files/policydocs/Falling%20Behind%20LHA%20full%20research%20Oct%
202019.pdf
7c. Earmark any underspend in the extended mitigations package for specific anti-
poverty initiatives.45
d. Redesign of the UC Contingency Fund: It should have an enhanced budget and be
legislatively removed from the Discretionary Support Scheme. A payment from the
Contingency Fund should be offered first and foremost, before the claimant is
informed about an Advance Payment, to mitigate the impact of debt for of UC
claimants.
e. The Discretionary Support scheme also requires urgent reform to make it more
accessible to those who are in hardship and who have immediate needs.
f. Take steps to protect low-income private renters impacted by cuts to housing
benefits.
g. Extend the welfare mitigations package to include reducing the impact of the two-
child policy in NI.
Question 4: Are there any other comments you would like to make in regard to this pro forma or
the consultation process generally?
31. We understand that the late timing of the Spending Review on the 25 November 2020 and
the legal requirements to present the draft Budget to the Assembly in advance constrains
the time for consultation on the budget and its equality impacts.46 The short time available
to consider and prepare a response, however, has not been conducive to securing a broad
range of complete responses from those with particular knowledge of how the budget will
impact upon the Department’s equality duties.
32. The Cliff Edge Coalition does, however, commend the Department on producing and
consulting on the impact of the budget as promptly as it did, from 27th January 2021, within
a challenging context.
45 The original mitigations package made it impossible to redirect the significant underspend. We therefore echo the NI
Human Rights Commission’s recommendation that any underspend in the extended package be earmarked for specific
anti-poverty initiatives.
46 https://www.legislation.gov.uk/ukpga/1998/47/section/64
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