Sign up to our Editors Choice newsletter now! Click here

Universal Credit: 'It's not too late to get it right'

Accessibility Menu

Menu Search

24dash - The UK's most up-to-date social housing and public sector news website

Universal Credit: 'It's not too late to get it right'

24DASH.COM Logo

Published by 24publishing for 24dash.com in Housing and also in Central Government, Communities, Local Government, Universal Credit

Universal Credit: 'It's not too late to get it right' Universal Credit: 'It's not too late to get it right'

Without urgent changes to Universal Credit, the Government risks undermining its own reforms, according to a new report supported by the Joseph Rowntree Foundation (JRF).

However, Tony Wilson, director of policy at the Centre for Economic & Social Inclusion - which published the report - argues that it's not too late to get it right.

The Government’s arguments for welfare reform are well rehearsed. There is a fiscal case but also an economic and social one: too many people are only marginally better off in work, while the design of the system has trapped people in poverty and worklessness.

Universal Credit, we are told, will fix these economic and social problems. However research published today, supported by the Joseph Rowntree Foundation, tells us that without urgent changes the Government risks undermining its own reforms.

We found strong support for the principles of Universal Credit. We strongly support it too. In our view, Universal Credit has the potential to address systemic problems in the benefit system that we have identified in previous research: complex claims processes, duplication of information, involvement of multiple agencies, a lack of transparency in what you get, and increased fraud and error.

There’s a wealth of research that shows that these issues do act as barriers to getting into work – particularly for people who’ve been out of work for a while, or who have particular needs like childcare or a health condition. Universal Credit has the potential, at a stroke, to solve these problems. It can be fully automated. It can be seamless in and out of work. It will be administered by one agency. 

And yet, as our research shows, the detail of the changes with Universal Credit could undermine all of this:

■It will be harder, for many people to claim than currently – with claimants required to apply online even though just 20% currently do so and just 40% of are ready and able.

■  Payment will be less frequent than now – with payments made monthly, even though we know that people on low incomes budget weekly and even daily.  For new claims, the first payment will be delayed to 37 or 38 days after the claim is submitted.

■The payment will be made all at once, to a nominated head of household – rather than as now, allowing elements to be paid separately All of these changes will lead to increased risks of budgeting problems, debt, arrears and ultimately financial exclusion.

All of these changes will lead to increased risks of budgeting problems, debt, arrears and ultimately financial exclusion.  In turn, they will make it less likely that some claimants will be ready to move back in to work.

The Government is taking steps now to mitigate many of these risks and we welcome that work. It is testing new approaches to providing local support, it is exploring how families can be supported to budget and is developing a bureaucratic ‘exceptions’ process which will allow those most at risk to get paid differently. 

But the one thing that the Government will not do is what seems the most straightforward: that is, pay Universal Credit fortnightly as now, allow people to claim it by telephone as now, and allow payments to be split within the family as now.

If this doesn’t happen though, then our report makes a number of recommendations for how we can reduce the risks for those most likely to become more excluded under Universal Credit. In particular we want to see simple, efficient and accessible support for those who cannot manage their claims online; better financial support for claimants in managing the move to monthly payments; and more personalised and flexible face-to-face support to help people move back into work.

Successive governments have had chequered histories in delivering major benefit reforms. In less than a year, we will start the biggest yet – affecting more than 10 million families nationwide. It’s not too late to get it right.

 

Comments

Login and comment using one of your accounts...