IRIS Consulting: Press Release 160202

New Research into Local Authority Outsourcing of Housing Benefits and Council Tax Administration commissioned by Department for Work and Pensions

The Department for Work and Pensions (DWP) has commissioned a comprehensive research study to examine the impact and effects of outsourcing on the efficiency of Housing Benefits (HB) and Council Tax Benefits (CTB) administration. The aim is to consider the potential role outsourcing can play in the effective delivery of the service.

DWP has appointed a joint team from IRIS Consulting and IRRV Solutions to carry out the research. The research team will be contacting a wide range of organisations to obtain information and views about the issues involved.

The outsourcing of HB/CTB services is currently under the spotlight. There have been a number of high profile contract failures over the last year or so, particularly in London, and press reports of more local authorities considering the future of their current contracts. But does this mean that outsourcing the service doesn’t or can’t work? The DWP has commissioned this research project to find out more.

The IRIS-led team are examining the impact and effects of outsourcing HB/CTB administration and the potential role outsourcing can play in the effective delivery of the service. The outcomes from the research will bring together key findings, draw out the policy messages and identify transferable good practice lessons.

The research team will be seeking the participation of local authorities at various stages of the research. They are carrying out a data audit exercise to find out the extent of local authorities’ experience of outsourcing and will be looking for more in-depth involvement from a small number of local authorities as case studies.

In looking at the issues and drawing up best practice, the research team will need to consider the following:
• The factors influencing local authorities’ decisions to outsource benefit administration
• The impact of contracting out on benefit administration, for example arrears/processing times/accuracy/fraud prevention
and detection
• The cost effectiveness of outsourcing HB/CTB administration and local authorities’ experience of doing so
• The effect on efficiency of service delivery in contracted out local authorities compared to non-contracted out ones
and pre/post contract implementation
• The effect on customer satisfaction of outsourcing
• Landlords’ perceptions of the service provided by contracted out and non contracted out authorities
• Claimants’ experiences of contracted out and non contracted out authorities
• The factors associated with good and bad performance and how/if they differ in those who have outsourced their service
• What more could be done to make administration run more smoothly.

Practice has varied greatly since local authorities have been able to outsource most functions relating to the administration of Housing and Council Tax Benefit under first the 1995 Compulsory Competitive Tendering regime and since 2000 under the Best Value framework. Some local authorities have kept the service totally in-house, some have outsourced some functions and others who outsourced certain HB/CBT administration services, have brought them back in-house.

Recent policy developments will mean that local authorities will soon be able to contract out more functions, particularly decisions about individuals’ benefit entitlement.

DWP are encouraging local authorities, if approached about the project, to participate. DWP want to find out what the experience and views of local authorities is to feed into the research findings and any future policy development in this area.

The DWP official responsible for the conduct of the research is Karen Elsmore who can be contacted on 0207 962 8279 or karen.elsmore@dwp.gsi.gov.uk.

If you have questions about the conduct of the research project itself, please contact: John Harvey or Robin Gray at IRIS Consulting, on 020 7 287 0822 (or e-mail: johnharvey@irisconsulting.co.uk)
or Mike Gill at IRRV Solutions on 0207 712 1711 or by e-mail to mike.gill@irrvsolutions.com.