Clash of stats during Universal Credit debate

23 Oct 2017

Universal Credit (UC) aims to simplify benefits by merging six benefits into one and asking people to deal with only one part of Government. Labour used one of their ‚ opposition days‚ to hold a Commons debate on the UC roll-out of. About 90 MPs wanted to speak. The roll-out continues with 55 areas this month. There was a vote at the end of the debate in which Labour‚ s motion was approved 299-0, mainly because Conservative MPs (under orders from the party whips) abstained. The result means the House of Commons has called on the Government to pause the roll-out of UC. While the result of the vote is non-binding on the Government it is a symbolic victory for Labour. Speaker John Bercow caused controversy by stating that, following the vote: "A minister from the government should come to the House and show respect to the institution and say what it intends to do."

The Prime Minister announced separately before this debate that the premium rate helpline for UC queries will now be free. It is important to understand that the six-week delay in getting UC when someone is switched to it is deliberate, so it can be paid monthly (this blog explains more)

Labour speakers

Shadow Work and Pensions Secretary Debbie Abrahams spoke of a ‚ number of serious design flaws‚ with UC: UC applications are ‚ digital by default‚ , UC payments are made monthly, in arrears, paid only to the main earner of each household, rely on unreliable information to achieve real-time information. Because the severe disability premium payment has not been incorporated into UC, it is an effective loss of up to £62.45 a week for a single person. She talked of her concern that under UC regulations people in low-paid work on UC will now be subject to in-work conditionality. Half those in rent arrears under universal credit report that they entered into arrears after they made their claim. She reminded MPs that the Government‚ s advance payment is a loan that has to be paid back within six months out of future social security payments. We learned that a forthcoming report by Child Poverty Action Group (CPAG) will say UC was designed to be more generous to couples than single people, with lone parents in particular expected to lose out compared with tax credits. The introduction of the minimum income floor does not allow for the fluctuations in income that are experienced by the self-employed, she said. She wants to see the alternative payment arrangements to be offered to all claimants at the time of their claims. That includes ending the one-week wait and enabling people to have fortnightly, instead of monthly, payments where appropriate with the option of the housing element to go directly to the landlord.

Angela Eagle said her local food bank, alongside the citizens advice bureau, has estimated that, if this full roll-out goes ahead in Wallasey just six weeks before Christmas, ‚ leaving everybody destitute for Christmas day‚ , it will have to collect 15 tonnes of extra food to deal with the demand. Stephen Timms pointed to a survey of 105 local councils, which showed that of claimants who claim universal credit, over half of the council tenants are in rent arrears compared with only 10 per cent of those on the old housing benefit. Seema Malhotra said UC claimants make up 15.4 per cent of all local authority tenants in her Hounslow borough, but they account for 49 per cent of all tenant arrears.

Jim McMahon said the Greater Manchester Law Centre refuse to support UC, on the basis that it results in further adversity and punishment for vulnerable people. Karen Buck supports the call of housing charities for changes to be made to the roll-out of UC to make sure that when people take that step into work they do not put themselves at increased risk of losing their home. Judith Cummins cited the CPAG when stating all families with children will be worse off by an average of £960 a year by 2020, and all single-parent families will be left worse off by, on average, £2,380 under UC. Jobcentre Plus staff know that the system cannot cope and that the IT system is too fragile and inflexible and does not reflect things such as childcare costs or fluctuating incomes, claimed Neil Coyle.

Jessica Morden supports calls from Community Housing Cymru which want a pause in the accelerated roll-out of the full service until the problems caused by delays have been addressed. UC penalise the poor and does nothing to resolve the underlying issues of low pay, housing costs and insecure employment, says Grahame Morris. Andrew Bowie said the latest independent research commissioned by the DWP shows that people claiming universal credit on the live service were three percentage points more likely to be in work after three months than those claiming JSA, and four percentage points more likely to be in work six months after starting their claim. Anna McMorrin said there are 475 needless deaths every year across Wales alone because vulnerable people are unable to afford to heat their homes.

There is an understanding among landlords that they do not take people on UC said Siobhain McDonagh. Laura Pidcock said advance payments‚ or loans have always been available for those at crisis point, ‚ that amounts to for a single person under the age of 25: they get about £126 for six weeks, which equates to £21 a week or £3 a day‚ . Margaret Greenwood also said advance payments amount to only 50 per cent of two weeks‚ payments of the claimant‚ s estimated UC and paying UC to only one person in the household is a ‚ risky experiment‚ , Shadow Treasury Minister Anneliese Dodds wants advice agencies to be given implied consent to represent the people they are trying to help.

Conservative speakers

David Gauke, Secretary of State for Work and Pensions, said claimants receive tailored support under UC to get them into work, such as a ‚ work coach‚ , and UC makes being out of work more like being in work, because people are paid monthly. He claimed DWP analysis shows that 250,000 more people will be in employment as a result of UC when it is fully rolled out. The former Financial Secretary to the Treasury said DWP‚ s latest data show that 80 per cent of new claimants are being paid in full and on time. He has recently improved the guidance to DWP staff to ensure that anyone who requires an advance payment will be offered it up front.

Mark Pawsey said that, since the introduction of UC in 2012, the claimant count in his Rugby constituency has halved. Richard Graham wants to see the largest housing associations have an ‚ implant‚ inside the Jobcentre Plus to make sure they get the necessary advance so that they can pay their rent. Iain Duncan Smith said the roll out has a ‚ Test, learn and rectify‚ process. He said the mistakes in tax credits and housing benefit mean that more than 60 per cent of those coming on to universal credit already carry debt and rent arrears.

Mark Harper said paying landlords directly would assume that everybody on UC is incapable of managing their own money. Justin Tomlinson said Jobcentres must also recognise the need for local solutions around the training options provided.

The Government must seriously consider implementing the recommendation from Citizens Advice that those who need it must receive a payment within two weeks, which they will not have to pay back, says Peter Aldous. Private sector landlords must be put on a level playing field with social landlords when it comes to setting up alternative payment arrangements. Rishi Sunak said the average wait time for advice, on the UC helpline, is two minutes. Jo Churchill is concerned that her local housing association said it is not yet able to access the portal for trusted partners.

In 2015, 86 per cent of those on UC were actively looking to work more hours, compared with only 38 per cent under jobseeker‚ s allowance, claimed Kirstene Hair. Heidi Allen suggested the removal of the initial seven-day wait ‚ at a minimal sum of £150 million to £200 million a year would be an inexpensive fix that would benefit all claimants‚ .

SNP speakers

The party‚ s Spokesperson on Social Justice, Neil Gray, wants to see a cut to the automatic minimum wait from at least six weeks to a guaranteed four weeks, making payments on a fortnightly rather than a monthly basis, and DWP to do more on advance payments to make them part of the award and therefore not recoupable as a loan. Citizens Advice in East Lothian, where UC has been rolled out, says that more than half its clients on UC are £45 per week worse off.

Ronnie Cowan said food bank referrals have gone up by 70 per cent in their constituency of Inverclyde since the UC rollout there in November. Alison Thewliss talked about the two-child policy, saying women in Northern Ireland should not face the choice between being forced into a criminal justice situation and putting food in their children‚ s mouths. Mhairi Black said Citizens Advice has found that, from 52,000 cases, those on universal credit appear to have, on average, less than £4 a month left to pay all their creditors after they have paid essential living costs.

Other speakers

Lib Dem Tom Brake said that, according to Citizens Advice, one in three people now wait longer than six weeks, and one in 10 wait longer than 10 weeks.

Green Caroline Lucas want to see the end of the six week wait for UC.

There have been changes to UC in Northern Ireland, explained DUP Sammy Wilson, such as automatic direct payments to landlords built into the system. ‚ ùThe money is not part of disposable income; it has to be used for a specific purpose, and therefore there is no reason why it cannot be paid directly.‚ ù

The full debate can be read here.