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Guidance

LA Welfare Direct 6/2026

Updated 17 June 2026

© Crown copyright 2026

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This publication is available at https://www.gov.uk/government/publications/la-welfare-direct-bulletins-2026/la-welfare-direct-62026

Contact

If you have queries about the:

  • technical content of this bulletin then contact details are given at the end of each article

  • general content and distribution of this bulletin, contact lawelfare.correspondence@dwp.gov.uk

Who should read

All Housing Benefit colleagues, County Councils and wider if appropriate

County Councils: Please note the articles at paragraphs 18 to 25, and 26 to 31 are for your attention.

Action

For information.

Crown Copyright 2026

Recipients may freely reproduce this bulletin.

Editorial  

As this June edition of the LA Welfare Direct bulletin lands with you, I hope you’ve managed to enjoy some of the recent good weather but I’m sure for some, like me, you’re actually not too sorry to see things cool down a bit! 

As usual, this edition contains a range of important updates, including enhancements to the SHBE (Single Housing Benefit Extract) data sharing solution and the onboarding plan for a new internet-based solution for access to Searchlight. For the latter, please do look out for the form that is to be issued shortly as it’s important that this information is returned to ensure a smooth rollout.

I also wanted to highlight the published statistics on fraud and error in the benefits system and the fall in the Housing Benefit overpayment rate in the financial year ending (FYE) March 2026 from the FYE March 2025. It’s good to see this moving in the right direction and thank you for the important part you have played in this.

I hope you find this edition helpful and please do send on any feedback, which is always welcomed, to lawelfare.correspondance@dwp.gov.uk  

Donna Thompson 

Head of Local Authority Grants

Update: SHBE Application Programming Interface data sharing solution enhancement and monitoring of submissions

1. The Department for Work and Pensions (DWP) has enhanced the Single Housing Benefit Extract (SHBE) Application Programming Interface (API) data sharing solution. Previously, Housing Benefit (HB) claimant details were matched to Searchlight using a strict criterion, which resulted in a high number of matching failures that local authorities (LAs) had to investigate. 

2. To address this, DWP has introduced new matching rules. Records will match where any three of the following details align:

  • first name 
  • last name 
  • date of birth 
  • postcode 
  • National Insurance number 

3. This improvement should significantly reduce matching errors and manual follow‑up activity for LAs.

Monitoring SHBE API submissions

4. DWP has identified periods where the SHBE API data has not been received from some LAs. When those LAs were contacted, it appears the most common causes were:

  • API certificates not renewed before expiry 
  • changes to LA IP addresses not notified to DWP within the six‑week service level agreement

5. As DWP teams rely more on SHBE API data instead of the monthly clerical report, it is essential that the flow of the SHBE API data is continuous. Therefore, LAs are asked to work closely with their IT departments to ensure that the SHBE API connectivity is maintained and treated as a priority. 

6. If LAs have any queries regarding the SHBE API, contact lawelfare.ladsdeliveryteam@dwp.gov.uk

Same day access to Real Time Information data within Verify Earnings and Pensions

7. The introduction of same day access to Real Time Information data within Verify Earnings and Pensions (VEP) will remove the current 24-hour delay when setting an interest for HB, Local Council Tax Reduction and other enquiries. The VEP team is currently planning delivery with implementation expected by end of June 2026.

Next steps

8. Further details, including the confirmed implementation date and updated VEP guidance will be published on Glasscubes. All staff should continue to follow existing VEP guidance until the updated version is issued. 

9. Any queries should be sent to lawelfare.datamatching@dwp.gov.uk

Clarification on the HB Award Accuracy Initiative Year 7 end-of year arrangements

10. Performance Relationship Managers have received a number of queries from LAs seeking clarification on the end-of-year arrangements for the HB Award Accuracy (HBAA) Initiative Year 7 for the financial year ending (FYE) March 2027, specifically in relation to the: 

  • duration of reviews and reporting period 
  • end of year performance activity and the run-on period 
  • final cut-off dates

Duration of reviews and reporting period

11. The formal reporting period for HBAA Year 7 covers the whole of the FYE March 2027. LAs should continue to progress reviews throughout this period in line with initiative guidance.

End of year performance activity and run-on period

12. To maximise the capture of HBAA Initiative outcomes and support return on investment within the reporting year, data will continue to be captured and refreshed for up to three months after the end of the financial year. 

13. This means activity can continue to be reflected in performance returns up to and including the FYE March 2027 SHBE submissions, with updates continuing through the subsequent three month period.

14. This approach ensures that outcomes from late-stage reviews and interventions are appropriately recorded and counted within the Year 7 reporting period.

Final cut-off dates

15. LAs will be notified no later than January 2027 of the final cut-off dates and any associated requirements for capturing outcomes for HBAA Year 7. 

16. LAs should continue to prioritise review activity throughout the year and into the run-on period to ensure maximum capture of Initiative outcomes. 

17. If you have any queries, please contact lawelfare.pdt@dwp.gov.uk

Update: DWP Public Services Network removal and replacement with an internet based solution

18. LAs, other government departments and IT software suppliers currently access Searchlight through the Public Services Network (PSN). 

19. The DWP PSN is scheduled for decommissioning in early 2027. As a result, all users must migrate to a new internet-based solution to ensure continued access to Searchlight services. This transition will follow a phased onboarding plan. 

20. The onboarding process has been tested with a small group of LAs over recent months and we would like to take this opportunity to thank those LAs who have supported this testing phase and provided valuable feedback. 

21. As testing nears completion, we are now ready to begin the national rollout of the internet-based solution. The rollout will be delivered in tranches and DWP will contact each LA when their allocated rollout tranche is due to begin.

LA certificates and IP addresses

22. To mitigate the risk of the removal of the PSN, DWP is proposing:

  • Certification management changes: DWP will only issue certificates to LAs, not their Contracted Service Providers (CSPs). LAs must manage sharing certificates with them to ensure clear data sharing agreements are in place.
  • IP safelisting changes: DWP will only safelist IP addresses for LAs, not their CSPs. LAs must work with them to manage access to ensure trusted environments have clear data sharing agreements.

Next steps

23. We will shortly issue a form to all LAs using their single inbox. This will capture the information DWP requires prior to the LA go-live, including: 

  • the LA’s internet-facing IP address 
  • extra terms and conditions relating to internet and device security  
  • updated contact details for the appropriate LA representatives

24. Once this information has been received, DWP will complete the necessary internal steps and contact you again when your allocated rollout tranche is initiated. This will involve further technical activity where your IT department will need to provide support to ensure your continued access to Searchlight.  

25. If you have any questions, please contact lawelfare.ladsdeliveryteam@dwp.gov.uk

Change of tax year for HB Matching Service self-assessment rules

26. At present, the HB Matching Service (HBMS) self-assessment referrals are matched against the tax year 2023 to 2024.  

27. From May 2026, HBMS referrals are matched against the tax year 2024 to 2025.    

28. This means all LAs will be receiving higher volumes of referrals and possible duplications within the first couple of months of this change (May and June 2026). However, volumes will start to decrease by month three of implementation.

29. LAs will be aware that changes to the tax year for HBMS are implemented in May of each year in line with HM Revenue and Customs procedures.   

30. The following rules, which are detailed in the HMBS rule guide held on Glasscubes will be impacted:   

  • HBSA002   
  • HBSA003  
  • HBSA004  
  • HBHB405  

31. If you have any questions, you can contact lawelfare.datamatching@dwp.gov.uk

Updated Service Level Agreement: HB recovered by DWPs’ Debt Management

32. The Service Level Agreement for the FYE March 2025 and March 2026, between DWPs’ Debt Management and LAs has been updated for the FYE March 2027 and 2028. 

33. This recent update was agreed by your Practitioners’ Operational Group (POG) representatives in May 2026. 

34. It has been placed on Glasscubes and Debt Management will continue to review it every two years.  

35. If you have any questions about the content of this article, contact caxtonhouse.lapedpdpsupport@dwp.gov.uk

Reminder: HB appeals to the First-tier Social Security and Child Support Tribunal

36. LAs are reminded that where an HB appeal to the First-tier Social Security and Child Support Tribunal has another party (such as both the tenant and the landlord) and they have redacted any personal information (such as the National Insurance number) they must notify the Tribunal of any redactions at the time of submitting the response.

37. Any questions regarding this article should be sent to sscsa-consumer-services@Justice.gov.uk

Decision of the Upper Tribunal: Contrived tenancies in supported accommodation

38. On 20 April 2026, the Upper Tribunal (UT) considered two cases, F.Y.E v Middlesbrough City Council and G.P.Z v Sunderland City Council.  

39. The First-tier Tribunal (FtT) had found in each case that the claimant’s liability had been created to take advantage of the HB scheme, as outlined in Regulation 9(1)(l) of the Housing Benefit Regulations 2006. 

40. The funding model used in these cases is common and can be a legitimate one. A company acquired a property and adapted it to be suitable for providing supported accommodation. The company let the premises, in this case to a charity. The charity provides accommodation and support for HB claimants.

41. The FtT did not suggest that all supported housing funding structures of this type are inherently unlawful. However, the properties were bought by one company and immediately sold to another at a huge profit. They were then let to a charity and the same individual was involved in each of the companies and the charity, as well as having a role in a company that provided financial support for the charity. 

42. The UT upheld the original FtT decision of contrivance. See the full UT decision   

43. This decision does not change the law but is useful for LAs to be aware of when examining similar funding arrangements.

Fraud and error in the benefit system national statistics

44. The monetary value of fraud and error national statistics for the FYE March 2026 were published on 14 May 2026:  

45. Do note: All monetary values to follow are expressed in billions (bn) and millions (m).

Summary for all DWP benefits

46. The following table shows the comparison to the FYE March 2025 for all DWP benefits. Do note, for HB the client group reviewed in the FYE March 2025 was Working Age, whereas the client group reviewed in the FYE March 2026 was Pension age:

Benefit type Percentage of total (2026) Total spend (2026) Percentage of total (2025) Total spend (2025)
Estimate of the total rate of overpayments 3.2% £9.9bn 3.3% £9.5bn
Rate of Fraud overpayments 2.2% £6.8bn 2.2% £6.5bn
Rate of Claimant Error overpayments 0.6% £1.85bn 0.7% £1.9bn
Rate of Official Error overpayments 0.4% £1.2bn 0.4% £1.0bn
Estimate of the total rate of underpayments 0.4% £1.2bn 0.4% £1.2bn
Total unfulfilled eligibility rate 1.2% £3.7bn 1.3% £3.7bn

47. The HB overpayment rate was 7.2% (£1,100m) for the FYE March 2025, which has reduced to 6.2% (£800m) for the FYE March 2026 and breaks down as follows:

Overpayments type Overpayment rate (2026) Overpayment spend (2026) Overpayment rate (2025) Overpayment spend (2025)
Overpayments due to Fraud 3.6% £460m 4.1% £630m
Overpayments due to Claimant Error 2.1% £270m 2.5% £390m
Overpayments due to Official Error 0.5% £60m 0.6% £90m

48. Do note some key points:

  • Although there were no statistically significant changes in overpayments due to Capital at the total HB level, Capital overpayments for Pension age claims (both non-passported and passported groups combined) saw a statistically significant fall to 3.3% in the FYE March 2026 from 4.5% in the FYE March 2025. 

  • The HB underpayment rate was 0.3% (£40m) in the FYE March 2026, compared with 0.4% (£60m) in the FYE March 2025. 

  • The total HB unfulfilled eligibility rate fell to 1.0% (£130 million) in the FYE March 2026, dropping from 1.2% in the FYE March 2025.

Update: Move to Universal Credit

49. Following a statement made to the House of Commons on 20 April 2026, the Minister for Social Security and Disability, Sir Stephen Timms, wrote to LA Chief Executive Officers and key stakeholders. In his letter, he highlighted the importance of collaboration with them, other voluntary organisations and the disability sector, He also thanked them for their crucial role in supporting claimants throughout the transition process. 

50. Universal Credit (UC) now supports over 8.4 million people, with more than 1.9 million successfully moved from legacy benefits through the ‘Move to UC’ campaign. Significant milestones include the closure of tax credits in April 2025, which saw over 1 million claimants transferred, and the closure of Income Support and income-related Jobseeker’s Allowance in April 2026, affecting 135,000 customers. These steps have simplified the welfare system while ensuring claimants received appropriate support.

51. Progress has also been made with income-related Employment and Support Allowance (ESA(IR)), with 879,000 households issued migration notices by December 2025, most of whom have already claimed UC.

52. The final stage of the transition focuses on the remaining ESA(IR) and Working Age HB claimants. These benefits (apart from HB for those in temporary accommodation and supported accommodation) will close on 30 June 2026.

53. Around 500 claimants have been identified who need additional help managing their claims through a Personal or Corporate Acting Body. These individuals are temporarily exempt from the June 2026 closure deadline to ensure they are not disadvantaged while proper arrangements are made. However, this exemption is not indefinite and a final closure date for these cases will be confirmed later. 

54. It is important that ongoing collaboration with stakeholders continues to support the remaining claimants to move to UC.

POG and Local Authority Welfare Steering Group

55. The last Local Authority Welfare Steering Group meeting took place on 21 May 2026. Agenda items included LA funding, bringing the administration together for HB and Pension Credit, Legacy HB Discovery, Move to UC, supported housing and the Crisis and Resilience Fund. 

56. Both groups’ meetings are held bi-monthly on alternate months so the next meeting is POG, scheduled to take place on 18 June 2026. 

57. If you have any questions regarding topics raised at these consultation groups, email lawelfare.correspondence@dwp.gov.uk

HB Decisions by the UT

58. Decision Making and Appeals (DMA) Leeds is not aware of any cases that have been decided by the UT. 

59. You can read all Decisions of the UT on their website. Do be aware that there is an undefined time lapse between decisions being issued and their appearance on the website.

HB cases awaiting decision by the UT

60. DMA Leeds has not been made aware of any case that is awaiting decision by the UT since our previous LAWD entry in May 2026. 

61. If you have any queries about cases before the UT Judges or courts, please contact us by email at quarryhouse.dmaleedscustomersupportservices@dwp.gov.uk

New Legislation

62. The following Statutory Instruments (SIs) have been laid:

63. Copies of SIs can now be downloaded from legislation.gov.uk

What’s new on our HB pages on GOV.UK

64. The following items can be found on the website link shown:

Document Type Subject Link
LAWD bulletin Editorial 
Local authority funding for Department for Work and Pensions commissioned work delivered by IT software suppliers 
Changes to HB Matching Service Rule HBUC105 
HB subsidy guidance manual for the financial year ending March 2026 
Update: Identifying Local Vulnerability and progress towards a Minimum Viable Product
Update: CHIS national rollout progress 
Insight and good practice in the administration of HB for those in temporary accommodation 
Publication of HB speed of processing statistics for October 2025 to December 2025 
Practitioners’ Operational Group and LA Welfare Steering Group 
HB Decisions by the Upper Tribunal 
New Legislation 
What’s new on our HB pages on www.gov.uk		 LAWD5/2026
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