Claims administration
Claims processing
2.1 HB and CTB payments help people on low incomes. As these groups of people are vulnerable, their claims should be dealt with quickly and accurately. The Best Value regime requires local authorities to measure and report the average time for processing new claims and changes of circumstances.
2.2 The council achieved Standard in one of the 6 relevant performance measures and met 3 of the 10 enablers scoped into the inspection for Claims administration.
2.3 To enable us to comment on the council’s effectiveness in claims processing, we:
- obtained reports from the council’s Benefits IT system, showing all new claims and changes of circumstances decided between June 2005 and January 2006
- analysed a random sample of 20 new claims and 24 changes of circumstances
- looked at its management information
- interviewed managers and Benefits staff.
Data analysis
2.4 The council introduced a new Benefits IT system in June 2005. As part of our inspection we interrogated the Benefits IT system and obtained a download of all new claims processed between June 2005 and January 2006.
2.5 Figure 2.1 shows the council’s performance for processing all new claims received from June 2005. Our analysis separates performance for those old claims received before June 2005 and those current claims received afterwards. This highlights the adverse impact that the backlog was having on overall clearance times.
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Source: BFI analysis
2.6 Figure 2.1 highlights the problems the Benefits service faced following the implementation of its new Benefits IT system in June 2005. As the backlog was relatively small in June and July 2005, new claims received after June 2005 were cleared within Standard. However, as the backlog grew between August and December 2005, the work associated with it prevented staff from clearing the new claims received. As a result by January 2006, in addition to the original backlog, which was averaging 341 days to clear old claims, there was also a backlog of new claims received. The effect of the 2 backlogs was that overall claims processing was taking an average of 93 days.
2.7 The council stated that the reasons for the build up in the backlog included:
- a legacy of workflow management issues resulting from the council’s centralisation of its Benefits service, such as the merging of the different filing systems from its neighbourhood offices
- a lack of processing capacity during the implementation of its new Benefits IT system
- restructuring its Revenues and Benefits service
- operating with approximately 20 staff vacancies while experiencing difficulties recruiting permanent staff
- the requirement to resource the council’s First Stop Shop, following its opening in June 2005.
2.8 We discuss the council’s failure to control and eliminate the backlog under workload management.
Performance measures
2.9 Figure 2.2 shows the council’s reported performance for claims processing for 2004/05 and the latest reported performance for quarter 3, October to December 2005.
| Performance Measure | Description | Standard | Performance 2004/05 | Performance October to December 2005 |
|---|---|---|---|---|
| PM 1 | Average time for processing new claims (days) | 36 | 69 | 72 |
| PM 2 | % of new claims outstanding over 50 days | 10 | N/A | 73 |
| PM 3 | % new claims decided within 14 days of receiving all information | 90 | 64 | 43 |
| PM 4 | % of rent allowance claims paid on time or within 7 days of a decision being made | 90 | 47 | 88 |
| PM 5 | Average time for processing changes of circumstances (days) | 9 | 21 | 51 |
Source: Walsall Metropolitan Borough Council
Average time for processing new claims
2.10 Figure 2.3 shows the results of our analysis of the average time taken at key stages in processing the new claims in our sample, which covered the period June 2005 to January 2006.
| Work step | Average days | Range days |
|---|---|---|
| Date of receipt at designated office to date of first action | 9 | 1 – 104 |
| Date of first action to all information or evidence available | 61 | 1 – 177 |
| Date of all information or evidence available to date of decision | 42 | 1 – 158 |
| Total days from date claim received to date of decision | 112 | 16 – 182 |
Source: BFI sample and analysis
2.11 Figure 2.3 shows that there were delays at all stages in a number of the claims in our sample.
2.12 We obtained a report of and analysed all claims processing data from the Benefits IT system for the period June 2005 to January 2006.
2.13 Figure 2.4 shows a breakdown of the speed of processing for all new claims processed between June 2005 and January 2006. It also shows that only 22% of all claims were processed within Standard, while 56% of claims took longer than 60 days to process.
2.14 In January 2006, in an effort to improve customer service, the council introduced a new initiative called The Walsall Promise. This promise guaranteed customers that the council would decide all new claims within 14 days of receiving all necessary information.
2.15 We analysed each of the 141 claims received in January 2006. This showed that although the council’s average speed of processing for these new claims was 11 days, the time taken to process them ranged between one and 27 days.
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Source: BFI analysis |
2.16 Our analysis of all claims data from the Benefits IT system showed that of all claims processed between June 2005 and January 2006, only 14% had all the necessary information required to process the claim when it was first received by the council. This undoubtedly affected the council’s claims processing performance and demonstrates the importance of emphasising to customers the need to provide all appropriate evidence to support their claims. (See recommendation 1)
Data cleansing
2.17 Prior to the on-site phase of our inspection we obtained details of all new claims processed between June 2005 and January 2006 directly from the Benefits IT system. This data showed the date a claim was received and the date it was processed. When we analysed this data we found a number of incorrect entries. These included duplicate entries and new claims which, we concluded later, were changes of circumstances.
2.18 While we were on site we provided a list of these claims for the council to analyse and amend. The preliminary results of the data cleansing showed that the council had overstated its processing times by several days. Further data cleansing exercises were planned by the council following our on-site visit.
2.19 We identified that these problems were caused by user input error. In response, the council told us that it would provide refresher training to all appropriate staff to rectify this issue. (See recommendation 2)
Percentage of new claims outstanding over 50 days
2.20 Reporting against this Performance measure was introduced from the end of the first quarter of 2005/06. The Department set local authorities a target of having no more than 10% of new claims outstanding over 50 days. The council’s reported performance against this target for the first 3 quarters of 2005/06 is shown in Figure 2.5.
| Standard | April to June 2005 | July to September 2005 | October to December 2005 |
|---|---|---|---|
| 10% | 26% | 28% | 73% |
Source: The Department
2.21 Figure 2.5 shows a significant rise in the number of claims outstanding over 50 days. This resulted in an increase in phone calls and personal callers at the council’s First Stop Shop facility, and complaints from customers and landlords.
2.22 In our sample of 20 new claims, 16 (80%) had been outstanding for over 50 days. We were told the lack of resources available to the Benefits service was contributing to the backlog and rising age of new claims outstanding.
Percentage of new claims decided within 14 days of receiving all information
2.23 Local authorities have a statutory duty to make a decision on all claims within 14 days of receiving all the necessary information, or as soon as practicable thereafter. The Standard for this enabler is 90%.
2.24 The council’s reported performance showed that it decided 64% of new claims within 14 days of receiving all information in 2004/05. However, performance for April to December 2005 had deteriorated to 47%.
2.25 Figure 2.6 shows the performance from our sample in processing new claims within 14 days of receiving all information.
| Days | Number | % |
|---|---|---|
| 0 – 14 | 8 | 40 |
| 15 – 28 | Nil | Nil |
| Over 28 | 12 | 60 |
| Total | 20 | 100 |
Source: BFI sample and analysis
2.26 We found in our sample that once all the information was received it took on average 42 days to process the claim. However, as previously reported, following the introduction of The Walsall Promise in January 2006, processing speed had improved.
Percentage of rent allowance claims paid on time or within 7 days of decision being made
2.27 Performance Standards require councils to make rent allowance payments on time, or within 7 days of the decision being made in 90% of cases. However, councils were not required to report performance against this performance measure until the end of the first quarter of 2005/06.
2.28 Figure 2.7 illustrates the significant improvement in the council’s performance in the quarter October to December 2005 in this area.
| Performance Measure | Standard | 2004/05 | April to June 2005 |
July to September 2005 | October to December 2005 |
|---|---|---|---|---|---|
| % of rent allowance claims paid on time or within 7 days of a decision being made | 90 | 47 | 52 | 45 | 88 |
Source: Walsall Metropolitan Borough Council
2.29 The council was unable to explain why some claims were not being paid on time or the reasons for its reported improvement in performance. This demonstrated a lack of management control.
2.30 In our sample of 20 new claims, there were 17 rent allowance claims and the remaining 3 were CTB-only claims. Our sample showed that 76% of cases were paid within 7 days, as compared with the council’s reported performance of 88%. There were no obvious reasons for the delays in our sample of new claims.
2.31 Figure 2.8 shows the time taken to make a rent allowance payment from our sample of new claims.
| Days | Number | % |
|---|---|---|
| 0 – 7 | 13 | 76 |
| 8 – 14 | 4 | 24 |
| Total | 17 | 100 |
Source: BFI sample and analysis
Average speed of processing changes of circumstances
2.32 The council reported that it took an average of 21 days to process changes of circumstances for the year ending 31 March 2005. Performance deteriorated during 2005, with reported performance averaging 54 days for the first 3 quarters of 2005/06. The Standard is 9 days.
2.33 We discussed this deterioration with management and were told that it was due to the impact of legislation which abolished benefit periods and introduced interventions.
2.34 To test the accuracy of the council’s reported performance, we selected 24 changes of circumstances processed between June 2005 and February 2006. We found that 4 (17%) of the 24 cases we had selected were not appropriate changes of circumstances for the purposes of the Performance Indicator.
2.35 Of these cases:
- 2 were changes of circumstances identified as a result of interventions
- one was a change of circumstances processed as a result of an automated notification on the Benefits IT system
- one was a new claim which had been incorrectly recorded as a change of circumstances.
2.36 Housing Benefit and Council Tax Circular A10/2005 issued by the Department in April 2005, explains what should be counted as a change of circumstances for the purposes of the Performance Indicator. Incorrect recording of changes of circumstances meant that the council had reported inaccurate performance information to the Department.
2.37 Of the remaining 20 cases from our sample, we identified one case which had not been fully processed. The average time taken to process the remaining 19 cases in our sample was 55 days. This was in line with the council’s reported performance of 54 days for the first 3 quarters of 2005/06.
2.38 Our sampling showed that the time taken to process a change of circumstances ranged from 3 to188 days. Figure 2.9 shows a breakdown of the speed of processing from our sample of 19 completed changes of circumstances cases.
| Days | Number | Percentage |
|---|---|---|
| 0 – 9 | 4 | 21 |
| 10 – 15 | 2 | 10 |
| 16 – 23 | 1 | 5 |
| Over 23 | 12 | 64 |
| Total | 19 | 100 |
Source: BFI analysis
2.39 Figure 2.9 shows that only 4 (21%) cases in our sample were processed within the Standard of 9 days.
2.40 We also analysed all of the council’s change of circumstances data held on the Benefits IT system and found that there were multiple entries in respect of single changes for the same customers, and cases showing unusually high delays in processing the changes.
2.41 We discussed this with the Benefits service managers who arranged to review a sample of 12 of these cases while we were on-site. Errors had occurred in recording the number of changes notified by the customer, and the actual date that each individual change was processed on the Benefits IT system. These errors have had an adverse impact on the council’s reported performance for the speed of processing changes of circumstances. The Benefits service managers told us that they would issue further guidance to staff to help prevent these errors. (See recommendation 2)
Accuracy
2.42 Figure 2.10 shows the council’s reported performance on its accuracy of payment in 2004/05 and quarter 3 of 2005/06.
| Performance Measure | Description | Standard | 2004/05 | October to December 2005 | |
|---|---|---|---|---|---|
| PM 6 | % of cases for which the calculation of the amount of benefit due is correct | 98 | 97 | 98 | |
Source: The Department
2.43 The council reported its performance against the accuracy target as being at Standard for the quarter to December 2005. There were no examples in our new claims and changes of circumstances samples of benefit being incorrectly calculated.
Performance enablers
Workload Management
2.44 In December 2005, the processing of new claims and changes of circumstances was divided into 3 teams. One team dealt with new claims under The Walsall Promise, the second team handled the existing new claims backlog, while the third team dealt with changes of circumstances.
2.45 In addition to these responsibilities, the teams also provided staff on a rota basis to resource the dedicated customer telephone lines and the First Stop Shop for personal callers. This put considerable pressure on teams, which were already operating with around 20 staff vacancies.
2.46 We found that this drain on resources, combined with the backlog of work had severely affected the council’s ability to manage its workload.
2.47 Until late 2005, the council counted the work received, work completed and the outstanding backlog on a weekly basis. However, as the backlog grew this manual count took a considerable amount of time so the council changed to a monthly count.
2.48 The council’s backlog increased from 6,344 pieces of work in June 2005 to 12,861 pieces of work in February 2006, having peaked in January at 13,744. The amount of work outstanding in February 2006 equated to approximately 20 weeks’ work.
2.49 The Team Leaders were required to give priority to allocating resources to the First Stop Shop, followed by processing The Walsall Promise cases before dealing with other cases. In practice, this meant that Team Leaders prioritised cases considered to be ‘urgent’, for example because a landlord was threatening to evict a customer. Only after this, if resources were available would the teams try to tackle the remainder of the backlog.
2.50 Performance Standards require that local authorities have clear systems, which it can demonstrate are working, to prioritise the processing of claims for customers moving into work. We reviewed the council’s procedure for making extended payments and found that, although the council provided guidance which defined extended payments, it did not prioritise their treatment.
2.51In our sample of changes of circumstances, we found one case where an extended payment was made. Our analysis showed that it had taken 120 days for the council to process this case. (See recommendation 3)
Gathering information
2.52 Where it has been necessary for a council to request additional information from the customer in support of a claim, the council should identify these claims within 7 days of receipt.
2.53 Our analysis of all data from the Benefits IT system, showing the speed of processing new claims from June 2005 to January 2006, showed that requests for further information to support a claim were required in 86% of cases.
2.54 There were 12 cases (60%) in our new claims sample that required further information but only one request (8%) was issued within 7 days.
2.55 We consider that customers should be educated and processes put in place to ensure that a much higher proportion of claims are supported by all evidence at the outset. (See recommendation 1)
2.56 The council must allow the customer one month to provide this information. Performance Standards require that a reminder should be issued to the customer advising that if the information is still outstanding before the expiry of this period, and that if the customer does not provide the information then they may lose benefit.
2.57 Benefits service managers told us that because of limited resources and the backlog of work, reminders were not consistently sent to customers as this was considered a lower priority than processing the outstanding work.
2.58 Figure 2.11 shows the council’s performance in issuing reminders for further information to customers within one month in our sampled cases.
| Sample type | Number in sample | Number issued within 1 month | % |
|---|---|---|---|
| New claims | 9 | 3 | 33 |
| Changes of circumstances | 7 | 2 | 29 |
| Total | 16 | 5 | 31 |
Source: BFI samples and analysis
2.59Figure 2.11 shows that it took more
than one month to issue a reminder for further information in 69% of the cases
sampled. We found that the average speed for issuing reminders was 46 days,
the longest being 111 days.
(See recommendation 4)
Prioritising changes of circumstances
2.60 The council operated a procedure to identify changes of circumstances which could lead to a reduction in, or termination of benefit and give them priority. These claims were suspended in full immediately to minimise the occurrence of overpayments. While this is good practice, due to limited resources and the backlog, Team Leaders generally focused resources on processing these changes to the exclusion of all others.
2.61 However, periodically the increasing backlog of changes of circumstances, some of which would result in increased entitlement, would force the Team Leader to divert all resources into processing this work instead.
2.62The council’s practice of suspending cases
in full, combined with the delays in processing changes of circumstances meant
that some customers with reduced entitlement to benefit could suffer hardship
by accumulating rent arrears. This also increased the likelihood of customers
calling or visiting the First Stop Shop, putting further pressure on resources.
(See recommendation 3)
HB and CTB Claim Form
2.63 Clear HB and CTB claim forms and leaflets can help reduce the need for requests for further information from the customer and reduce the risk of customer confusion or fraud. Clear advice at the time of the claim can reinforce messages about the need to provide evidence of identity and income, and resolve concerns of those with limited documentation.
2.64 The council updated its HB and CTB claim form in 2005. It followed the design and content principles of the Department’s model claim form and had the following good features. It:
- had clear signposting
- was available in other languages
- featured regular checklists.
2.65 The claim form contained a section for customers to give their consent for the council to provide specific information to their landlord, and included appropriate consent wording, detailing the type of information which could be disclosed to landlords.
2.66 We were told it was council policy to accept signed requests from the customer to allow landlords or representatives to make enquiries on the customer’s behalf. This was confirmed by the Registered Social Landlords.
Working effectively with landlords to minimise repossessions
2.67 In
March 2003 Walsall Metropolitan Borough Council completed a
large-scale voluntary stock transfer of its housing stock. This resulted in
the creation of a number of Registered Social Landlords in the area.
2.68 The largest of these was
the Walsall Housing Group with over
22,000 homes in its portfolio, followed by Walsall Alliance of Tenant Management
Organisations Community Homes with 1,750 transferred
homes and 8 local offices.
2.69 Where a council is experiencing a backlog in processing new claims and changes of circumstance, it is particularly important that there are clear and effective communications between the council and landlords. We found that the council had gone to considerable lengths to foster good relations with its landlord community and Walsall Housing Group in particular.
2.70 Examples of good practice which we identified included:
- hosting a monthly forum for Registered Social Landlords and the council to share views and feedback, and providing comprehensive minutes
- holding a quarterly meeting between the Chief Executive of Walsall Metropolitan Borough Council and the Chief Executive of Walsall Housing Group to discuss any issues
- providing dedicated telephone lines and e-mail addresses for landlords to contact the Benefits service
- issuing information packs providing clear practical advice to landlords on the operation of Housing Benefit
- delivering refresher training for Registered Social Landlords on the requirements of the Verification Framework.
2.71 However, we found that the scale of the backlog of work and the resultant delays in processing were creating cash flow issues for the landlord community, who were experiencing increasing levels of rent arrears from customers claiming HB and CTB.
2.72 The council told us that
landlords were applying pressure to both tenants and the Benefits service
to get their claims treated as a priority. This pressure was a major determining
factor for Team Leaders in identifying the urgency with which cases from the
backlog should be treated. We were also told that on occasion, landlords would
contact the Benefits service both by telephone and
e-mail, and at the same time advise the tenant to call into the First Stop
Shop, potentially resulting in 3 members of council staff trying to locate
and action the same claim simultaneously.
2.73 Registered Social Landlords told us that because of the delays in processing claims, they felt obliged to initiate proceedings such as issuing a Notice to Seek Possession to tenants, even though they had reason to believe the tenant may be entitled to benefit. Landlords considered that this was necessary to protect their interests in case a tenant’s claim eventually proved to be unsuccessful. Then they might have to prove to a court that they had exercised due care and consideration in their dealings with the tenant should the case ultimately proceed for eviction.
2.74We consider that this situation could cause undue distress for vulnerable customers, as evidenced by a recent case reported in the local press, where an 87 year old, visually impaired tenant with a record of 60 years without rent arrears was threatened with eviction. (See recommendation 10)
Quality and reducing error
2.75 Members and senior managers, who are accountable for the delivery of effective and secure HB and CTB administration, need assurance that the Benefits service and counter-fraud efforts are working as planned. Councils need to ensure that they make full use of management information and checking data across the full range of their benefit activities.
Quality checks
2.76 Effective quality checks are an important means of providing assurance on the:
- quality of work such as the evaluation of performance against legislative and other requirements
- training and development needs of employees
- identification of any weaknesses in processes.
2.77 The council had performed quality checks to identify trends and staff training needs. However, it was unable to gauge the level of individual performance or the overall level of quality or error of the claims processed because checks were not performed:
- consistently and regularly
- on a minimum 4% of all new claims and changes of circumstances as recommended by the Department
- before a decision or payment notice was issued.
(See recommendations 5 and 6)
Using quality checks to improve performance and reduce error
2.78 Where the council conducted checks, these were accurately recorded and where appropriate, feedback sheets and training referral forms providing details of the assessor and any errors made were sent to the Team Leaders.
2.79 The council’s training referral form was well designed and gave options for Team Leaders to select the most appropriate form of training, in conjunction with the Training Officer or Coach.
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