Citizens Advice renews its call for Universal Credit to be paused

By Bernadette Meaden
September 18, 2017

Citizens Advice has reiterated its call for the roll-out of Universal Credit to be paused and problems with the benefits fixed, as new figures from the Department for Work and Pensions (DWP) show one in five people applying for Universal Credit are waiting longer than six weeks for their first payment.

Further DWP research, published on September 15 2017, shows people on the new benefit are falling into rent arrears, with over two in five saying this was due to problems with the benefit. 

In August the equivalent of 12 per cent of people applying for Universal Credit turned to Citizens Advice for support.

Chief Executive of Citizens Advice Gillian Guy said, “These figures confirm Citizens Advice research showing that Universal Credit risks pushing people further into serious debt.

“The DWP’s own evidence shows more than one in five people applying for Universal Credit are waiting over six weeks for their first payment, and that many people say they are falling behind on their rent as a result.

“It is clearer than ever that the government must pause the roll-out of Universal Credit and fix the problems with this benefit.”

In a report published last week, (http://www.ekklesia.co.uk/node/24328) Citizens Advice analysed over 50,000 cases where it has helped people with their debt problems and found that for those on Universal Credit:

  •  79 per cent have priority debts such a rent or council tax, putting them at greater risk of eviction,   visits from bailiffs, being cut off from energy supplies and even prison - compared to (69 per cent) on legacy benefits such as Jobseekers Allowance or Housing Benefit.  
  •  Two in five (41 per cent) have no money available to pay creditors as their monthly spend on essential living costs is more than their income.
  •  Typically people on Universal Credit only have around £3 a month left to pay creditors.

It is urging the government to ensure no one applying for Universal Credit waits longer than six weeks for an income, and that anyone who needs it gets a payment within two weeks that they do not need to repay.

Universal Credit was introduced in 2013, aiming to simplify the benefits system, to make transitions into work easier, and make every hour of work pay. It’s there for people on low incomes or not in work to help them meet their living costs.

Universal Credit is for people both in work and out of work, disabled people and those with a health condition, single people and those with families, people who own their homes and people who rent.

It replaces six means-tested benefits and tax credits with one benefit. This is paid in arrears, as a single household payment, on a monthly basis.

It is designed to use Real Time Information from HMRC to respond to changes in income, gradually reducing the UC payment as earnings increase to ensure work pays. The six benefits it replaces are:

  •      Income-based Jobseeker's Allowance (JSA)
  •      Income-based Employment Support Allowance (ESA)
  •      Housing benefit (HB)
  •      Income Support (IS)
  •      Child Tax Credits (CTC)
  •      Working Tax Credits (WTC)

Universal Credit is being rolled out gradually across the country, one job centre at a time. Everywhere in the country either operates a 'live service' or 'full service'.

Live service areas are places where a limited version of Universal Credit is in place only for certain people (eg single adults not in work), so as to test the system on  on those with simpler claims.  ‘Full’ service has been developed to upgrade and build on the first, ‘live’ system.  

From May 2016, full service Universal Credit began to be introduced across the country, in a small number of local authorities initially, which meant all new claimants of the six different benefits being replaced are required to apply for UC.

Live service roll-out is now complete, but full service roll-out is ongoing and due to accelerate significantly from October 2017. All areas will eventually become full service by 2022.

There are currently 533,000 people on Universal Credit in England and Wales, with around 50,000 new claims each month.

* Citizens Advice https://www.citizensadvice.org.uk/

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