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On track

Our use of technology to help tenants cope with Universal Credit typifies the resilience of the sector, says Ruth Cooke

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On track

Poole 7

Source: BNPS.co.uk

The bank holiday at the start of this month brought with it another entertaining weekend of sport for our household, Leicester City were declared premiership champions against the odds – we all expected them to veer completely off track months ago.  

Whilst Sebastian Vettel did just that but in spectacular style at the Russian Grand Prix after he was completely knocked out on lap one.

Not good news either for Universal Credit recently though as according to findings by the Resolution Foundation it has completely ‘veered off track’

Claimants are apparently not being incentivised to return to work – something which goes against the very heart of what it was set up to do.

As more and more of our customers are signed up to Universal Credit and housing benefit payments are no longer made as ‘direct payments’ to their housing association landlord, we anticipate many customers could struggle to mange their finances and ultimately fall behind with their rent. 

Indeed we have now begun to see rent arrears going over the rails and swinging upwards with the sector reporting an average increase in rental arrears of over £800 per customer.

Research carried out by the National Housing Federation found that housing association income teams would need to increase customer contact by 300-400% to avoid high levels of rent arrears following the introduction of Universal Credit.

“We have now begun to see rent arrears going over the rails and swinging upwards with the sector reporting an average increase in rental arrears of over £800 per customer.”

To drive this level of customer contact is a massive challenge, especially with the wider ‘policy storm clouds’ sitting right over us. But in November last year, seven months after Universal Credit was introduced and following a period of declining cash payments, we turned to technology to find new ways to support our customers through this change.

Following the example of banks, dentists and doctors we have incorporated automated outgoing voice and text messages into our income team’s day to day customer contact approach.  Working closely with our customers and rostrvm for Housing we procured an automated outbound dialler for rental collections and reminders.  This is intended to increase customer contact and intervene early when the support is needed.

We are among the first in our sector to have built this new experience for our customers, who now receive information at the right time using the right device for them. 

Six months later and we are on the right course.  Successful contact with customers has risen from 10-15% to 65-75%, without us needing to increase the size of our workforce

We have achieved a £348k increase in cash payments over a period of 6 months and Midland Heart has since hit our lowest ever level of arrears.  We have gone on to raise our direct debit uptake to 25% after being fixed at 14.5% for over seven years. Our customers have welcomed the approach too and satisfaction levels remain continually high at between 89-96%.

The system complements the work of our internal money advice team who in the past year, have also supported customers to renegotiate debts and apply for benefits, maximising customer income by £1.9m.

Universal Credit may now be off track and hit the barriers, but we are showing how providers can use technology to help customers who are struggling with budgeting or paying their rent to navigate the new system and keep firmly on course.   

This is just one example of how our sector adapts to ensure that we get on with what really matters-supporting our customers to sustain a tenancy and maximise their independence.

Ruth Cooke, chief executive, Midland Heart

 

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