The longer Universal Credit exists in an area, the higher the need for foodbanks, says the Trussell Trust, prompting fresh calls for the abolition of the Government’s “immoral” five-week waiting period
By Mark Cantrell
UNIVERSAL Credit was supposed to give substance to the ministerial slogan ‘making work pay’, but in practice it has served to empty the phrase of everything but cruel parody.
On paper, it was meant to revolutionise the benefits system, offering greater flexibility, making it simpler and more responsive to people’s changing circumstances. In practice, it has become a synonym for Dickensian hardship.
Since Universal Credit was first introduced in 2013, it has prompted a library’s worth of critical and outright damning reports, detailing the shortcomings of this ailing flagship reform. The Trussell Trust has added yet another to the pile. The organisation supports a UK-wide network of more than 1,200 food banks providing emergency food aid, so it’s well-placed to observe the UK’s rising tide of poverty.
According to the Trussell Trust, the longer Universal Credit has been in force in an area, the more people end up plunged into poverty. This has spurred the charity to launch its #5WeeksTooLong campaign to persuade ministers to take a fresh look at the new ‘benefit’.
The wait for legacy benefits was typically a fortnight, but with Universal Credit there’s a mandatory five week wait between making a claim and receiving the first payment; a long time for people with little or no savings, and no other source of income.
Originally, this had been six weeks before the Government ‘softened’ its stance in February 2018. In areas where Universal Credit has been rolled out for at least a year, the trust said the food banks in its network have seen a 30% increase in demand. In areas with the new system in place for at least 18 months, this jumps to 40%, and it increases again to 48% for food banks in areas with Universal Credit for at least two years.
The charity acknowledges that the Department for Work & Pensions has attempted to find solutions to issues with Universal Credit, but it says that the wait for a first benefit payment – which in practice is often longer than five weeks – continues to cause “unnecessary hardship”. What’s more, the Government’s solution to provide loans during this waiting period is no solution at all, the charity says, because it simply serves to push more people into debt.
“Universal Credit should be there to anchor any of us against the tides of poverty. But the five-week wait fatally undermines this principle, pushing people into debt, homelessness and destitution,” said Emma Revie, the Trussell Trust’s chief executive.
“In a society that believes in justice and compassion, this isn’t right. But it is something that can be fixed. Universal Credit was designed to have a wait. Now it’s clear that wait is five weeks too long, and we must change that design.
“The recent Spending Review was a lost opportunity to protect people on the lowest incomes. Our Prime Minister must take action to end this wait and help prevent thousands more of us being swept away by poverty.
“With the nation at a crossroads, now is the time to loosen the grip of poverty and make sure Universal Credit is able to protect people from needing a food bank, instead of pushing them to one.”
Housing association Riverside says it has found a similar pattern of financial hardship in areas where Universal Credit has rolled out; evidence it shared with the Trussell Trust for its report. On average, according to the analysis, people claiming Universal Credit at July 2019 had experienced a 42% increase in rent arrears since rollout began in 2015. By stark contrast, those claiming Housing Benefit (the previous ‘legacy’ benefits system) experienced a 20% decrease.
“Riverside is calling on the Government to end the five-week wait for Universal Credit because increasing numbers of our tenants are experiencing hardship while waiting for their first payment,” said Hugh Owen, Riverside’s director of strategy and public affairs. “Our data clearly shows that the wait is causing many of our tenants to get into rent arrears, which can take months or even years to clear.
“A recent survey of many of our tenants told us that they are struggling to keep afloat when they move onto Universal Credit; the long wait means that many people are going without food or heating and they are forced to use foodbanks in order to feed their families.
“We welcome the simplicity that moving to an integrated benefit is intended to bring, but the way Universal Credit is being implemented means that instead of acting as a safety net, it is dragging people into debt.”
The Joseph Rowntree Foundation (JRF), responding to the Trussell Trust’s report, has also called for an end to the “immoral” five-week waiting period.
“Universal Credit has the potential to be a force for good in our society, but the current design of the system is stifling its ability to provide the support families need,” said Iain Porter, the JRF’s policy and partnerships manager.
“For millions of people, every day feels like they are constantly swimming against the tide, at risk of being pulled under by the powerful currents of low pay, high rents or an unexpected bill.
“The Trussell Trust is right that there is nothing compassionate or just about the initial five week-wait for Universal Credit. Nor can we stand by while the system is forcing families to turn to foodbanks when it should be helping to end the need for them.”
The organisation wants to see the Government offer everyone on Universal Credit the opportunity to receive payments fortnightly. Furthermore, it is calling for the “urgent introduction” of an upfront, non-repayable grant to help those most in need of support.
Other measures JRF wants to see introduced is a two-week run-on of child tax credit to help families with children. The Government should also incorporate greater flexibility for claimants around repaying an advance under Universal Credit or backdating their claim, so that no one is pulled deeper into poverty or destitution.
“We estimate that two in five families yet to move onto Universal Credit will be unable to meet basic living costs during the five-week wait. That’s two million families, of which around 700,000 will continue to face a shortfall during the following year as they repay their advances,” Porter added.
“The Government has a responsibility to go beyond sticking plaster solutions to this problem by ending the immoral five-week wait. Ministers have shown a willingness to take action before to correct flaws in the system, they must do so again if Universal Credit is to provide a reliable lifeline to families when they hit hard times.”
Universal Credit is a legacy of David Cameron’s government. But as with so many other issues affecting Britain today, our system of national governance is caught expending too much of its focus and reason dealing with another of Cameron’s legacies.
For now, we’re not just waiting for the politicians to listen, but to stop yelling at each other across the Brexit divide so that other pressing matters can get a word in.
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ENDNOTE: As this edition of Northern Housing was preparing to go to press, the Labour Party announced its intention to scrap Universal Credit and replace the Department of Work & Pensions with a Department for Social Security. The measures the party claims it would enact in office address the criticisms made of Universal Credit to date, though of course it all depends on the party winning the general election.
This article first appeared in the print edition of Northern Housing magazine #6 October 2019.