Calls to Stop Universal Credit Failing the People It Was Brought in to Help As 1M More to Join

PRESS RELEASE – 2nd Sept 2016

Calls to stop Universal Credit failing the people it was brought in to help as 1m more to join

Universal Credit has complicated a system it was supposed to simplify – with more issues to come

A new report has found that the rollout of Universal Credit in Scotland has been flawed and delayed, with major fears that the next phase will cause even more serious problems as it takes in working households covering an estimated one million people.

Universal Credit was introduced by the Conservative-Liberal Democrat coalition in 2010, with the aim of combining six different benefits for greater simplicity, as well as making work pay by reducing the loss of income when someone entered work.

Its introduction in Scotland has been dogged by major IT problems, with just 25,000 of the 66,000 people known to be out of work and claiming benefits currently covered by it.

Despite this record of failure and flawed implementation the DWP is determined to press ahead. The next phase will see households who are in work/and or in receipt of housing benefit added, just as 11 separate benefits representing 15.3% of the country’s welfare spend are devolved under the 2016 Scotland Act, causing even greater complexity in the welfare system.

Dr Azeem Ibrahim, the Scotland Institute Executive Chair, is calling for the Scottish Government to mitigate the worst effects of this by: insisting payments continue to be made to individuals, not households, obtaining clarity that any specifically Scottish benefits and agreements will not be used to reduce payments, pushing for more control over sanctions and insisting that the DWP does not apply its conditionality rules to remove benefits if people who are already in work are unable to find additional hours of work.

He said: “Benefit sanctions are already disproportionately affecting young people under 25 and other disadvantaged groups such as those who are homeless or have physical or mental health problems. Bringing 1 million of the poorest individuals in Scotland into this system is a worrying step.

“These recommendations will still mean that Universal Credit will remain a significant threat to the poorest in Scotland but will at least allow the Scottish Parliament greater oversight of how it is implemented in Scotland.”

Worryingly, key issues affecting payments and benefit interaction still have to be ironed out. The interaction between any specifically Scottish payments and Universal Credit is not yet clear, while harsher sanctions will now apply to claimants, who can lose some or all of their benefits if they fail to follow instructions from Job Centre staff to find more work.

Other key changes due to be implemented include Universal Credit being paid to households rather than individuals – and usually to a nominated, male, member of the household, which has clear and deliberate implications for gender equality.

Crucially, once Universal Credit is fully implemented, anybody of working age in receipt of housing benefit will be subject to this regime. To place this in context, in late 2015 some 450,000 households, an estimated 750,000 adults and 250,000 children, were in receipt of housing benefit.

All of could now find their benefits stopped or reduced at the whim of DWP staff who deem they are not doing enough to increase their earnings or to enter work.

Our fear is that with political attention now focussed on the implications of the UK deciding to leave the EU, and Scotland seeking a separate status, there will be no meaningful scrutiny of what may prove to be the biggest threat to individual and household incomes in Scotland.

Ends

Editor's notes:

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