Universal Credit: Comment and information
Roll-out dates for Universal Credit in 2018 in Greater Manchester:
March 2018: Ashton under Lyne and Hyde
April 2018: Ashton in Makerfield, Leigh and Wigan
May 2018: Middleton and Rochdale
July 2018: Bury, Cheetham Hill, Prestwich and Wythenshawe
September 2018: Eccles, Irlam, Salford and Worsley
November 2018: Bolton and Stockport
There are 3 different Benefit calculators available: Turn2us, entitledto and Policy in Practice. The last one includes an earnings slider, which shows how Universal Credit will be affected if earnings change.
Back to Basics: What is Universal Credit and what are the problems? A quick guide by the Guardian
Universal Credit (UC) is the supposed flagship reform of the benefits system, rolling together six benefits into one online-only system (including unemployment benefit, tax credits and housing benefit) . The theoretical aim, for which there was general support, was to simplify the benefits system and increase the incentives for people to work, rather than stay on benefits.
How long has it been around? The project was legislated for in 2011. The plan was to roll it out by 2017. However, a series of management failures, expensive IT blunders and design faults have seen it fall at least five years behind schedule.
What is the biggest problem? The original design set out a minimum 42-day wait for a first payment to claimants when they moved to UC. In the autumn 2017 budget the wait was reduced to 35 days from February 2018. The wait has led to rent arrears (and in some cases to eviction), hunger (food banks in UC areas report almost 17% increases in referrals), use of expensive credit and mental distress. Ministers have expanded the availability of hardship loans (now repayable over a year and resulting in reduced UC payments) to help new claimants while they wait for payment. Housing benefit will now continue for an extra two weeks after the start of a UC claim. Critics want the waiting time reduced to two or three weeks.
Are there other problems? Yes. Multibillion-pound cuts to work allowances imposed by the former chancellor mean UC is far less generous than originally envisaged. According to the Resolution Foundation thinktank, about 2.5m low-income working households will be more than £1,000 a year worse off when they move on to UC, reducing work incentives. Landlords are worried that the level of rent arrears racked up by tenants on UC and the whole system is not very user-friendly: claimants complain the system is complex, unreliable and difficult to manage, particularly if you have no internet access.
The Child Poverty Action Group produce a “Universal Credit: what you need to know” guide for both advisers who need to know how and when universal credit will affect their clients, and for those currently claiming benefits themselves. It is filled with clear advice and lots of useful examples. The current guide is the 4th edition, is 159 pages and costs £15 ISBN: 978 1 910715 33 8
Universal Credit: Can we fix it? Should we fix it? Excerpt from an article by Professor Jane Millar, University of Bath
“The Work and Pensions Select Committee in a new phase of their enquiry into the rollout of Universal Credit, identifies a list of ‘priorities’: self-employment; free school meals and passported benefits; work incentives, including both the work allowance and the taper rate; the locally delivered Universal Support system; and support for childcare costs in Universal Credit. The list does not tackle some of the most challenging changes such as the monthly assessment and the impact of a single monthly payment. Nevertheless, these are some major areas at the heart of Universal Credit, not just issues at the margins.
This follows hot on the heels of the Resolution Foundation’s ‘remedy’ report, which sets out 16 recommendations under four main headings: implementation; generosity of support; financial incentives to enter work; and financial incentives to progress. And this is not the end; there are many other people and organisations with ideas about how to fix Universal Credit. Gingerbread, for example, identifies seven areas particularly related to the needs and circumstances of lone parents.
There is, of course, quite a lot of overlap in the proposals. But still, that’s a lot of fixing. One might be forgiven for thinking that something that needs quite so much fixing is, perhaps, not really fit for purpose in the first place.
Should we fix it? The government says yes because Universal Credit will ensure that work always pays and will achieve three important goals: it will make people out of work search harder for jobs; it will increase the number of people in employment; and it will improve employment retention and progression.
But there is very little solid evidence so far to judge these claims.
And what of in-work progression? In many ways, this is the top prize. If Universal Credit can help low-paid workers improve their wages, and their jobs more generally, this would be an important outcome that could really improve incomes and lives. But we should be cautious about whether this is likely to happen. The Social Security Advisory Committee recently published a report on in-work progression and Universal Credit. This points out that ‘there is very little evidence as to what can be done to advance earnings progression’ – and that the DWP Randomised Control Trial, which is the main source of evidence so far, ‘has mostly involved single childless people who have progressed from unemployment into low paid work’.
There is a big policy and research agenda here, and ensuring that all Universal Credit recipients receive the best possible advice and support will be a major challenge.” Full article
Universal Credit and Foodbanks – perspectives from the Trussell Trust
Last year The Trussell Trust provided 1.2 million three-day emergency food supplies. Most people referred to their foodbanks were at the time supported by working age benefits. Yet the average income for households was just £319 in the month before they were referred. Most households had been unable to afford heating, toiletries or suitable shoes or clothes for the weather. 78% had skipped meals and gone without eating – sometimes for days at a time, often multiple times a year.
Our current system of benefits is letting many of the most vulnerable people in our country down. Last year, Trussell Trust foodbanks in areas of full Universal Credit rollout saw an 16.85% average increase in referrals for emergency food, more than double the national average of 6.64%.
It is not just the way Universal Credit has been designed that is leaving people in crisis. There are also serious issues in its implementation. Due to poor administration and IT issues, some people are waiting 11, 12 and even 13 weeks to receive their first Universal Credit payment.
So, what can be done? In the immediate term, work to amend Universal Credit’s design and tackle poor administration in the system is needed before it should be rolled out further without causing more hunger and destitution. The Trussell Trust also knows there are some areas where Universal Credit hasn’t led to huge increases in the number of people needing foodbanks and they want to find out why. But what the Trussell Trust must not become is a charity safety net that catches people because our benefits system is fundamentally flawed, not just for moral or ethical reasons, but because the evidence on Universal Credit leads them to believe that even with the enormous generosity of donors and the hard work of volunteers and staff, they and the other foodbanks across the country will simply not be able to catch everybody who falls. More information Now is not a time for celebration
To find your nearest foodbank please check GMPA’s Emergency Food Providers map.
Universal Credit and Housing
In a recent article by the Residential Landlords Association, they stated that 38% of landlords saw their Universal Credit tenants fail to pay their rent and start to fall into arrears.
“Currently, if Universal Credit tenants leave a home where they owe rent there is no mechanism for the landlord to recover the money owed to them via the benefit system. They simply have to write it off. This is not fair, and against a backdrop of draconian tax changes and the pressures of increased regulation and licensing, it is a risk fewer and fewer landlords are willing to take. Only 13% of landlords we questioned were willing to let properties to tenants on Universal Credit as it stands.
On January 9th MPs met at Westminster Hall to debate the effect of Universal Credit on the private rented sector. This debate provides an important opportunity to get past the politics and show how all the parties, working with landlords and tenants can secure the benefit system we all want – one that is easy to understand, fair to all, supports the vulnerable and ensures the security of a home for all claimants.” Full article
Universal Credit deductions excerpt from an article by Kate Belgrave
“A Freedom of Information request revealed that between April 2016 and October 2017, 95,620 Universal Credit claimants had deductions made from their payments due to tax credit debt. The average monthly deduction in October was £50.85 – no small amount for people who are already on such low incomes and who often already have money deducted from their benefits for other debts such as rent arrears, council tax, court fines and more recently, advance Universal Credit loans which they are forced to take out to cover delays in initial payments.
People don’t know how much money they will receive from one month to the next. Trying to find someone who will help them resolve complex, cross-department benefits problems is soul-destroying. People who receive Universal Credit can’t afford financial uncertainty, or the stress that goes with using these systems.” Full article