Welfare reform to pose significant challenges for Northern Ireland

28 Oct 2011     Last updated: 20 Jun 2014

The incoming welfare reforms have been widely described as the most radical shake up of the social security system in over 40 years. The proposed aim of the reform and subsequent Bill is to simplify the benefits system, improve work incentives to encou

A recent report by the Institute of Fiscal Studies found that after London, Northern Ireland will be the hardest hit by tax and benefit cuts announced and to be implemented under the Bill between January 2011 and April 2014/15.[1]  This is for two reasons: the high numbers of those in receipt of Disability Living Allowance (DLA), especially for mental health disorders, and the high number of families with children who will be adversely affected by cuts to social security.[2] 

The loss to Northern Ireland’s benefit recipients will be more than £600 million per year by 2014-15.[3] Consideration to the potential impact of the welfare reform will have on Northern Ireland requires considerable attention, to which the voluntary and community sector is responding.

The Northern Ireland Welfare Reform Group (NIWRG) argues that Northern Ireland presents particular circumstances with regards to welfare reform and the arrangements to move people into employment. While benefit rates are universal across the UK, the NIWRG remind us that there are significant differences between social security provisions which recognise the particular circumstances in Northern Ireland. And that it is appropriate to tailor a Northern Ireland approach to issues raised in Welfare Reform Bill 2011.  

The Welfare Reform Bill 2011

The Welfare Reform Bill 2011 is currently progressing through Westminster and is at committee stage in the House of Lords.[4] It is estimated that the Bill will receive Royal Assent in early 2012. It follows the November 2010 White Paper, 'Universal Credit: Welfare that Works' and prepares for the introduction of a 'Universal Credit' to replace a range of existing means-tested benefits and tax credits for people of working age, starting from 2013.

Other significant changes to the benefit system arising from the Bill include the introduction of Personal Independence Payments to replace the current DLA, which will include a new ‘objective’ assessment process. There will be wide ranging measures and restrictions to Housing Benefit entitlement including caps on Local Housing Allowance payments.  Amendments will be also be made to child maintenance scheme tax credits, childcare costs and child benefit. Limits will be placed on payment of the contributory Employment Support Allowance to a 12 month period and caps will be placed on the total amount of benefit that can be claimed.  Changes will be introduced the State Pensions, pensions credit and the state pension age.

Corresponding provisions will be incorporated in a Northern Ireland Welfare Reform Bill, to be introduced through the Northern Ireland Assembly in January 2012. How and when the various strands of the reform will be applied to Northern Ireland will ultimately be a matter for the Minister for Social Development with Executive approval, and the Department for Social Development.

  • Changes proposed within the bill include the following:
  • Universal Credit / Household Benefit Cap 
  • Industrial Injuries Benefit; Simplification
  • Social sector housing under-occupation
  • Fraud penalties and sanctions
  • Housing Benefit: Consumer Price Index up-rating of Local Housing Allowance
  • Data sharing
  • Time-limiting contributory element of Employment and Support Allowance
  • Social Fund localisation
  • Youth provisions in Employment and Support Allowance
  • Payment on account of benefit
  • Entitlement to work condition – contributory benefits and statutory payments
  • Consideration of revision before appeal
  • Lone parent conditionality 
  • Tell us once
  • Conditionality: sanctions and hardship
  • Child maintenance: New scheme
  • Disability Living Allowance: Reform
  • Social Mobility and Child Poverty Commission

NICVA considers the Welfare Reform Bill of significant importance to the Voluntary and Community Sector and is an active member of the Northern Ireland Welfare Reform Group.

The Northern Ireland Welfare Reform Group, facilitated by the Law Centre NI, is an umbrella grouping of organisations that campaign for positive changes to policy, service provision and legislation for those in receipt of social security.

The Welfare Reform Group, submitted a briefing to the to the House of Lords in July 2011  highlighting some of the impending adverse impacts on particular groups such as disabled people, lone parents, children, women, older people also general issues within the Welfare Reform Bill around childcare, passport benefits, sanctions, hardship payments, benefit cap, cash protection and the abolishing of the Social Fund.

The Welfare Reform Bill (Northern Ireland) 2011 Equality Impact Assessment is currently being consulted on. It was launched on the 5 September 2011 and closes on the 30 November 2011.  Details of the report can be accessed on www.dsdni.gov.uk/consultations or by contacting [email protected]

For further information relating to the Northern Ireland Welfare Reform Group, membership and full details of the briefing document please contact [email protected] or call 028 9087 7777. A copy of the briefing paper can be downloaded below.

For access the Equality Impact Assessment (EQIA), please visit the Department for Social Development website: http://www.dsdni.gov.uk/index/consultations/eqia-welfare-reform-bill.htm

[1] James Browne, IFS Briefing Note 114 The Impact of Tax and Benefit Reform to be introduced between 2010/11 and 2013/14 in Northern Ireland pg 4, as cited in Joint Briefing – Northern Ireland Welfare Reform Group.

[2] Ibid

[3] Response to Northern Ireland’s draft budget, Mike Tomlinson and Grace Kelly, Poverty and Social Exclusion Project 2011 p 1


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