Universal credit could hurt most vulnerable

Thu, 22/11/2012 - 12:56 -- nick

Universal credit is due to be introduced across the country in October 2013, linking a number of benefits in to one single payment.

But MPs on the House of Commons Work and Pensions Committee have "serious concerns" that the most vulnerable people may not be able to cope with the new system.

Universal credit will replace a number of existing working-age benefits - the income-based jobseeker's allowance, income-related employment support allowance, housing benefit, working tax credit, child tax credit and income support.

It is designed to simplify the current system and encourage unemployed people to move in to work, but the timeframe - a pilot from April 2013 before introduction in the whole country from October - was described as "very ambitious" by MPs.

Existing claimants will be transferred to the system over the first four years of its operation, but the expectation will be that all new claimants will apply for benefits online.

The committee believed that universal credit would ease the transition in to work and that most claimants would be able to access the system, but was concerned that those used to receiving money each fortnight would struggle with the new monthly payments.

Its recommendations, as reported on the BBC website, include:

  • allowing claimants whose rental costs are currently paid directly to their landlord to continue this arrangement, should they wish, for a transitional period
  • evaluating the impact on tenants of paying them their housing costs to identify those who are struggling and may fall into arrears and those for whom such a process is unsuitable
  • ensuring there is a no fall in the value of support for the disabled, particularly if their circumstances change
  • putting in place contingency plans for any glitches in the IT system to be used to calculate payments based on earnings
  • future-proofing the delivery systems before the national rollout, to head off potential problems
  • giving more support to advice groups and advocates to help people with claims

Labour MP Dame Anne Begg, who chairs the committee, believed the government should focus on supporting the most vulnerable:

"We have serious concerns about about how more vulnerable people will cope with the changes, especially the online claims system and the proposed single monthly payment.

"The measures the government plans to put in place to help these claimants may be difficult to access and slow in identifying whose these people are, with the risk that they fall into debt and hardship before extra support can be provided."

The government, she added, "should consider modifying its implementation timescale if those consequences cannot be adequately addressed before national rollout begins".

The government says there will be flexibility in the system - with people able to get help to claim over the phone or in person and to keep fortnightly payments - as well as support to move on to the new system for those who need it.

"Universal credit will be paid monthly and accessed online because that reflects the experiences of working people," a Department for Work and Pensions spokesman said.

"The system needs to make it easier for people to move into work, but we've been clear from the outset that we will take steps to ensure vulnerable people don't miss out. We're already working with councils and the financial industry on the best ways to support individuals."

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