6 ways Universal Credit is failing

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​At heart, Universal Credit (UC) sounds like a good idea but in practice it has been an unmitigated disaster. Delays, administrative failures not to mention the cost, the system's myriad failings have pushed welfare and advice charities to the limit of their resources. Now after nearly £2bn in investment, there is no evidence UC will ever achieve its original goal of enticing more people in work. Here's a just a few reasons why...  

12th July 2018 by Robert Armour 1 Comment

1. Rent arrears

1. Rent arrears

Many private landlords say they will no longer rent to Universal Credit claimants because the risk of arrears is too high and the bureaucracy involved in tackling arrears too difficult to manage. Housing associations have warned that the accumulated bad debts run up by tenants as a result of UC could affect their house building plans. Already UC claimants are twice as likely has people on housing benefit to be in arrears. In Scotland claimants will be given the option whether to receive rent cash directly into their accounts or for it to go straight to their landlord – a move welcomed by housing associations and campaigners.

2. Delays

2. Delays

Because UC is based on how much money you have each month, it is paid in arrears: you claim for the previous month, not for the month ahead. That means everyone has to wait at least four weeks, and the rest of the time delays occur sporadically because of the way the scheme is administered. Foodbanks report that demand for charity food goes up significantly when UC is introduced into the local area. According to analysis by the Trussell Trust foodbanks that have been in full UC rollout areas for a year or more have experienced an average increase in demand of 52%. Some campaigners have said delays in receiving UC have led to destitution and a sharp rise in mental health problems among claimants.

3. Single payment

3. Single payment

Domestic violence refuges and charities say UC allows perpetrators of abuse to “distribute family income in the way they see fit.” This is because UC was designed to be paid to a single person per household. Campaigners say the payment should be split between partners in a households to minimise the risk of domestic abusers exerting financial control over their victim. Scotland’s new social security agency will make amendments to address this but the rest of the UK is lumped with this problem.

4. Online only

4. Online only

All UC claimants must have access to the internet in order to manage their accounts. While this might be easy for your average person, a significant number of those claiming benefits have no access to the internet – or a mobile phone. In 2017, 10% of UK households still had not access to the internet. An amazing 5.9 million adults in the UK have never used the internet, and 4.1 million people in social housing are offline. Charities have remonstrated to the government that people living chaotic lives will be denied benefits as a result of the policy, leading to them being further isolated and excluded.

5. The cost

5. The cost

While the DWP had estimated administration costs for the roll-out of Universal Credit to be £2.2 billion, by August 2014 this estimate had risen to £12.8 billion over its lifetime and was later increased again to £15.8 billion. New estimates range from a final cost of £16-20bn. The system so far has made savings of just 2% of the UK welfare budget.

6. Denial

6. Denial

The UK government says UC is working. Whether ministers actually believe this is the case is open to interpretation, however, publicly the architects of the scheme steadfastly refuse to accept its myriad failings. A recent National Audit Office report demolished ministerial claims about UC, concluding that the much-delayed flagship welfare programme may end up costing more than the benefit system it replaces, cannot prove it helps more claimants into work and is unlikely to ever deliver value for money.The DWP responded in time-honoured fashion by saying: “Universal credit is good value for money.”

6th August 2018 by robin

doesn't mention self employment at all or even the problems of people who work and have any variation in their earnings. and this inability or unwillingness to develop a system that can accommodate a normal business cycles ups and downs from the self proclaimed "party of business"