Thursday, November 26, 2020

Citizens Advice demands ‘fundamental overhaul’ of Universal Credit system

"We need to see significant changes to the way the Universal Credit is designed and delivered to ensure it supports the people who need it."

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Citizens Advice Scotland (CAS) has called for a “fundamental overhaul” of the Government’s controversial Universal Credit system.

CAS has written to the Work and Pensions Secretary Thérèse Coffey demanding urgent changes to the new benefit system, which rolls six different benefits into one single monthly payment, over concerns that claimants are being left in severe harsdhip.

The charity lists six key reforms it believes are necessary to reduce the hardship experienced by vulnerable people. These are:

  • Reduce the five week wait for the first payment to no more than two weeks
  • Introduce a grant payment for the assessment period to replace the current advance payment loans that are pushing people intodebt
  • End the digital by default application and claim maintenance process – ensure offline options are available
  • Extend the existing Work Allowances to all Universal Credit recipients, not just those with children or a limiting health condition
  • Increase the level of Work Allowances and reduce the Taper Rate to allow workers to keep more of what they earn
  • Review the way that DWP estimate earnings for the self-employed to reflect actual earnings
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Commenting, CAS Social Justice spokesperson Mhoraig Green said: “We need to see significant changes to the way the Universal Credit is designed and delivered to ensure it supports the people who need it.

“There are issues with how long people have to wait for a first payment, people being pushed into further debt, and the digital by default system which locks out people who don’t have the skills or means to apply and maintain their claim online.

“We need fundamental reforms to the system to address these issues.”

Jobcentre Plus sign.

She continued: “The new Government must also make ensure Universal Credit makes work pay. 

“A rising tide of people are working, yet remain in poverty. Our social security system should be a way to lift people out of poverty by supporting people into work and supplementing low paid work.

“Universal Credit is supposed to provide this support, but our evidence shows that in reality it penalises people who work.

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“The upcoming budget must be used to increase existing work allowances as well as introducing a new work allowance for people not currently covered by the existing ones, so people can keep more of what they earn and have a chance of working their way out of poverty.”

Universal Credit has also been blamed for pushing people to food banks, as claimants are made to wait several weeks before receiving their first payment – although Advances are available but must be repaid through deductions to future payments.

A Trussell Trust foodbank. Photo credit: Newfrontiers via photopin cc

In 2019, the Trussell Trust warned that the minimum five-week-wait is one of the main reasons why people turn to food banks.

Although Universal Credit is not the only benefit payment people at food banks experience problems with, it still accounted for the majority (65%) of food bank referrals made in April – Sept 2019.

In total, 823,145 three-day emergency food parcels were given to people in crisis in the UK between April – Sept 2019; more than a third of these (301,653) went to children.

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This represented a 23% increase on the same period in 2018 – the sharpest rate of increase the charity has seen for the past five years.

“More people than ever before are being forced to food banks’ doors”, said Trussell Trust’s chief executive Emma Revie.

“Our benefits system is supposed to protect us all from being swept into poverty, but currently thousands of women, men and children are not receiving sufficient protection from destitution.

“This is not right. But we know this situation can be fixed – our benefits system could be the key to unlocking people from poverty.”

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