Executive summary

Introduction

1.1 This report assesses Walsall Metropolitan Borough Council’s performance in dealing with Housing Benefit (HB) and Council Tax Benefit (CTB) claims processing. We have limited the scope of this inspection to those Performance Standards components that have a direct impact on reported claims processing performance.

1.2 This report should be read in conjunction with the Performance Standards pack, which can be downloaded from the Department for Work and Pensions’ (the Department) website:
http://www.dwp.gov.uk/housingbenefit/publications/perf-stands/index.asp

1.3 We are grateful to Walsall Metropolitan Borough Council for its help and cooperation throughout this inspection, the on-site phase of which took place in March 2006.

Context

1.4 The council has a resident population of approximately 252,000. In 2004/05 the council’s HB and CTB expenditure was £79 million paid to approximately 30,000 customers. This represented 13.9% of the council’s gross revenue expenditure of £568 million.

1.5 The council was selected for a focused inspection on claims processing because it reported that it was taking on average 72 days to process new claims and 51 days to process changes of circumstances for the quarter ended December 2005.

1.6 Over the last 3 years a number of high-level initiatives have adversely affected the Benefits service’s ability to administer benefits.

1.7 In March 2003 the council completed the voluntary transfer of its housing stock to local housing associations. The following year it closed its network of neighbourhood offices and centralised its benefits administration process. This required the integration of a number of different filing systems and was still causing problems in locating claim files at the time of our on-site visit.

1.8 In April 2005, the council opened its First Stop Shop facility for benefit related enquiries. This was a high priority customer service centre, the adequate staffing of which was considered essential.

1.9 In June 2005 the council implemented a new Benefits IT system. This created inevitable delays in claims processing, and as a result the volume of callers to the First Stop Shop increased as customers queried their HB and CTB claims. The need to provide staff for the First Stop Shop put further pressure on the already strained resources of the Benefits service. This situation was made worse when the council restructured its Revenues and Benefits service at the same time. Following these changes, work outstanding increased substantially.

1.10 In November 2005, the council released most of its temporary staff as planned. In addition some permanent staff left voluntarily, leaving the Benefits service with a significant shortfall of around 20 staff.

1.11 As part of its Putting the Citizen First initiative to outsource a number of its services to strategic partners during 2004/05 and 2005/06, the council had planned to outsource its Revenues and Benefits service. However, in January 2006 it decided to withdraw from discussions with its proposed strategic partners, and as a result did not proceed as planned. However, an appraisal of the options available to the council for administering its Benefits service, including outsourcing either in full or in part, was still planned between March and May 2006. We were told that a decision on the way forward would be made in May 2006.

1.12 The council was aware of the impact that these strategic issues had had on performance, and was committed to improvement. In March 2006, funding was obtained from the department for temporary staff to help clear the backlog.

Overall Performance

1.13 Following our scrutiny of Walsall Metropolitan Borough Council’s
self-assessment and analysis of the evidence provided, we found that it was at Standard in 6 of the 12 relevant performance measures and achieved 21 of the 39 enablers in the Claims administration, Security, User focus and Resource management themes scoped into this inspection.

1.14 The council’s performance for processing new claims and changes of circumstances has been bottom quartile for the last 2 years. For the period
June 2005 to January 2006, reported performance for the average time to process new claims was 83 days. Our sample showed an average time of
112 days for the same period. Comparative figures for changes of circumstances were 54 days and 55 days respectively.

1.15 We found that there had been inadequate managerial control over the Benefits administration process. This was typified by failure to:

• plan effectively for the impact of introducing a new Benefits IT system at the same time as opening a customer service centre
• use management information afforded by the Benefits IT system to help identify and manage the incoming work.

1.16 In addition we found that the council did not:

• routinely select a sample of claims to ensure that the data entered onto its Benefits IT system was accurate
• carry out sufficient and regular management checks of claims and changes of circumstances processed.

1.17 This meant that the council could not be sure that it was identifying the overall level of error or fraud in its caseload, and that the Department could have no assurance that the council’s reported performance was accurate.

1.18 A number of other weaknesses included:

• despite focusing resources on clearing the backlog in December 2005, it continued to grow and the overall time taken to clear claims increased, as a further backlog of new cases was created
• increased numbers of customers who were awaiting benefit were issued with Notice to Seek Possession orders by landlords, which subsequently increased the number of telephone calls and personal callers to the First Stop Shop
• delays at all stages of the council’s handling of appeals occurred.

1.19 Although the council set, and monitored progress against targets for the Benefits service, its targets for claims processing for 2006/07 were very stretching and required significant improvements in performance. However, in March 2006, the council had still not produced detailed action plans showing how it intended to achieve these targets, and did not propose to do so until May 2006, pending the result of its options appraisal.

1.20 On a positive note our inspection has shown that while overall performance for 2005/06 showed little improvement on previous years, we found a number of indications that things were improving. These included:

• a new Benefits IT system was introduced in June 2005, which offered the facility to provide a suite of complete management information with which to manage the service
• the recruitment of 2 new senior managers within the Revenues and Benefits service in December 2005
• some improvement in the speed of processing new claims between January and March 2006 following the introduction of The Walsall Promise, guaranteeing that customers who provided all evidence to support their claim would be paid within 14 days
• a good record for encouraging the take-up of benefit and working in partnership with other stakeholders as demonstrated by its creation of a joint team with the Department
• full compliance with the Verification Framework in August 2005. The overall level of verification in the cases sampled was of a good quality and we found only minor errors.

1.21 In addition the council’s Internal Audit service had adopted a risk-based approach, classifying the Benefits service as a core system and resourcing it accordingly. It also had an effective mechanism to monitor the implementation of recommendations from internal and external auditors.

Summary of recommendations

1.22 The following tables list the recommendations we have made in this report, grouping them by priority.

Recommendations

High priority
We recommend that Walsall Metropolitan Borough Council		Paragraph
1	ensures that iteducates its customers and puts processes in place to ensure that a much higher proportion of claims are supported by all evidence at the outset.	2.16, 2.55
2	ensures that staff accurately complete all fields on the Benefits IT system by: providing appropriate training monitoring the quality of completion by performing management checks providing feedback to staff and taking any necessary corrective action.	2.20, 2.41, 5.16, 5.40
3	develops and applies clear written procedural guidance for the Benefits service, that prioritises: extended payment cases for customers returning to work changes of circumstances that would lead to a reduction in, or a cessation of benefit in order to prevent the occurrence of overpayments.	2.51, 2.62
4	identifies the need for information from customers and third parties within 7 days of receipt of claims and where appropriate, issues reminders before the expiry of the 4-week or one-month period.	2.59
5	performs a check on a minimum of 4% of new claims and changes of circumstances in line with the Department’s guidance.	2.77
6	analyses the results of all management checks and uses its findings to identify the overall level of error in its caseload and inform training needs.	2.77
7	ensures that: 65% of requests for reconsideration are actioned and notified in 4 weeks 65% of appeals are submitted to the Appeals Service in 4 weeks 95% of appeals are submitted to the Appeals Service in 3 months meets its own target of implementing tribunals’ decisions on appeals within 28 days.	4.35
8	develops detailed action plans to achieve its claims processing targets for 2006/07, ensuring these are ready to implement as soon as it has made a decision on the future running of the Benefits service following the outcome of the options appraisal.	5.11
9	performs checks to validate user input to ensure that accurate management information is submitted to the Department.	5.39
Medium priority
10	operates an effective mechanism to actively encourage landlords to contact Revenues and Benefits before taking enforcement action to recover rent arrears which may be due to a delay in the payment of HB.	2.74
11	devises documented arrangements to manage the risks to the provision of the Benefits service, ensuring business continuity during change programmes and emergencies.	5.13
12	regularly reviews Benefits IT system access levels to ensure that these are appropriate to current job roles.	5.34
13	introduces safeguards to ensure that the unrestricted access to the Benefits IT system held by the Revenues and Benefits Systems Support Team is controlled, and usage is monitored.	5.36
14	reviews its post opening procedures to ensure that all valuables are securely controlled.	5.38
Low priority
15	ensures that staff responsible for receiving and verifying documents use ultraviolet scanners to authenticate documents.	3.6
16	ensures that all members of the Visiting Services Team are fully trained to carry out all of the duties required under their job roles.	3.13
17	monitors its service level agreements to provide assurance that the services provided match those agreed.	4.25

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