Headlines: February 24th, 2000

Local councils are responding to the difficulty of managing the complexities of Housing Benefit by putting the work out to contractors. The annual ITNET index shows that outsourcing of business processes by councils increased by 40% in 1999 and is now worth 143m pounds. Business processing has overtaken IT outsourcing which has increased marginally to 132m pounds.The National Housing Federation estimates that councils owe an estimated ?60 million in housing benefit to housing associations and it is calling on the government to take immediate action to remedy the problem. At the end of 1998 the DSS announced a programme to simplify and improve the delivery of housing benefit. This initiative was put on hold with the announcement of the Housing Green Paper, despite evidence that the administration of housing benefit was – in many areas – in chaos. In October 1999 Federation research showed that the average time taken to process a housing benefit claim was over three times longer than Government guidelines set out.The Department of Social Security is critical of the way in which councils manage Housing Benefit. It is estimated that some 900m pounds is lost annually through fraud and the Benefit Fraud inspection teams produce a steady stream of inspection reports highlighting weaknesses in council processes. The Institute of Economic Affairs has claimed that Housing Benefit is out of control.