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COUNCILS - MORE FREEDOM OVER HOUSING BENEFIT ADMIN

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Local authorities are to be consulted on greater flexibility when they contract out the administration of housing b...
Local authorities are to be consulted on greater flexibility when they contract out the administration of housing benefit and council tax benefit, Roger Evans, parliamentary under secretary of state for social security, announced today.

His announcement comes in response to changes introduced by environment secretary John Gummer to the CCT framework. At present few local authorities contract out benefits work but the proposed changes will increase the proportion of finance work which authorities subject to competition.

In response to a parliamentary question from Iain Duncan Smith (Chingford), Mr Evans said:

'Some local authorities have expressed concern that existing legislation prevents contractors who undertake housing and council tax benefit administration from carrying out determinations of benefit entitlement. This causes unnecessary double handling of claims and reduces the efficiency of contracts which local authorities are able to negotiate. I therefore propose to allow contractors to perform such determinations. In particular, this will enable local authorities to run pilots to establish whether they would wish to see such work permanently contracted-out.

'This change, allied to the proposals which the secretary of state for the environment has announced today for changes to the CCT framework for local authority professional services and housing management, will create a climate in which local authorities are able to negotiate more efficient arrangements for the administration of these benefits.

'I will open consultations shortly with the local authority associations with a view to bringing forward an Order under the Deregulation and Contracting Out Act.'

-- Local authorities can contract out the administration of housing benefit and council tax benefit but under existing legislation some functions, including the determination of benefit entitlement, have to be carried out by local authority officers. This results in the double handling of claims by the contractor and the client side and requires authorities to maintain in-house teams to carry out the work.

-- The Contracting Out Order proposed by Mr Evans will not compel authorities to contract out benefits determination work but will give them the choice to do so. If authorities wish to test the practicability of out-sourcing the work the Order will give them the freedom to set up pilot schemes.

-- The changes announced by the secretary of state for the environment today will increase the proportion of finance work which authorities subject to competition. Allowing authorities greater freedom in deciding which areas of their housing and council tax benefits administration should be contracted out will give them the opportunity to negotiate efficient contracts and to concentrate their own resources on monitoring the contractor's performance and standards of decision making.

-- Housing benefit and council tax benefit entitlement will continue to be dependent on social security legislation. The contracting out of housing benefit and council tax benefit decision making will not therefore affect individuals' entitlement or their rights to review or a review board.

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