Crisis of Confidence in Universal Credit

Policy Director Marc Francis outlines the deep issues with the government's flagship welfare policy

Marc Francis, Policy Director

Yesterday’s Parliamentary double-header on Universal Credit amounted to the biggest challenge to the Government’s flagship “welfare reform” so far.

First, the Work & Pensions Secretary, David Gauke MP, and his officials were given an early-morning grilling by the Work & Pensions select committee.  After a brief respite during Prime Ministers Questions, when Mrs May took the flak herself, Mr Gauke was back under sustained fire during an Opposition Day Debate calling for the “roll-out” to be paused.  Under threat of widespread rebellion from its own ranks, Government Whips went for a collective abstention – handing victory to the Opposition parties.

Citizens Advice’s intervention over the summer, when it published evidence of the scale of the problems UC claimants were experiencing and began calling for the roll-out to be “paused” has triggered a wave of horror stories in the media over the past month.  Perhaps most powerfully, the BBC has finally begun to expose the reality of UC for claimants – long delays in payments arising both by design and from their sheer administrative complexity have left thousands of families without enough money to feed their children, and left tenants in arrears and threatened with eviction.

UC “full service” hasn’t yet been rolled out to Westminster, where the majority of Z2K’s clients live.  But we have seen enough of the problems from the relatively small number of cases we have had so far to share the concerns that others have raised. Child Poverty Action Group, The Trussell Trust and others have long expressed concerns about the systemic problems which are undermining UC and leaving some of the nation’s most vulnerable people at risk of destitution.  The Government’s concession yesterday that the hotline will now be free of charge simply doesn’t go anywhere near enough to address those issues.

In particular, it is clear that the built-in delay of at least six weeks before the first payment is causing untold misery for claimants.  DWP’s claim that its Advance Payments deals with the issue flies in the face of the evidence from those parts of the country at full service already.  At best, the system of Advance Payments is a postcode lottery.  At worst, it is probably a shambles nationwide.  Z2K thinks that, as a very minimum, DWP need to move to a system of payment four weeks in arrears before full service roll-out is extended further.

These delays are also clearly the cause of the significant increase in rent arrears amongst UC tenants.  The Director General of Universal Credit tried to persuade the committee yesterday that no-one was being evicted because judges would say social landlords hadn’t followed the pre-action protocol.  This might be true, but as has been shown at length with the Bedroom Tax, it certainly doesn’t stop some social landlords threatening tenants with eviction and causing them unnecessary stress and anxiety or even to borrow to pay off the “arrears”.  And his argument has barely any relevance at all to tenants of private landlords.  We also question DWP’s insistence that tenants themselves must handle the money.

It was pretty clear yesterday morning that Conservative MPs like Heidi Allen and Chris Green were expecting the Secretary of State to come up with much more substantive changes, and he was pressed very strongly on each of these points.  The Government has used the tactic of abstaining in Opposition Day motions before, and so, given the lack of a majority for these kind of votes, it wasn’t a complete surprise to see it used this time.  But even so, it signals further concessions will have to be made – including possibly a longer “firebreak” pause than the month currently planned in January.  That would benefit our clients in Westminster who are currently scheduled to be subject to full service roll-out in February.  But its bullishness yesterday in deciding to plough ahead for the moment, might well come back and bite the Government if it leaves families penniless this Christmas.

Published: 19th October, 2017

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