Universal Credit leaving people destitute


​Glasgow City Council report says Universal Credit is compromising its services to homeless 

11th January 2017 by Robert Armour 0 Comments

Evidence has emerged that large numbers of claimants on Universal Credit (UC) are struggling to survive in Scotland’s biggest city.  

A report detailing the impact of the new scheme in Glasgow shows not only are claimants struggling but the controversial scheme is putting services and jobs at risk also.

The report, by Glasgow City Council, says that the problems are being further compounded as the Department for Work and Pensions (DWP) has been mistakenly transferring homeless people onto the initiative.

They have been exempt from UC until the city fully rolls out the new system in 2018 but the DWP, it discovered, has been registering homeless people in the city regardless.

It means by the time the error is fixed, many registered homeless people have gone days without accommodation costs, leaving them destitute.  

According to the report, a total of 73 homeless people in Glasgow are now on the benefit, and have racked up £144,000 in arrears between them.

It means the average arrears attributable to Universal Credit is £1,971 per person, and is increasing each month, says the report.  

Problems have arisen largely because UC gives claimants their accommodation costs each month in a lump sum. Many claimants, already in debt, end up spending the cash foregoing their accommodation payments. 

This not only leaves them out of pocket but the council also as it still has an obligation to provide accommodation for them, even though they are in arrears.   

Campaigners have argued the new system sets up vulnerable claimants for a fall as it puts too much temptation in their way. 

The introduction of universal credit is placing further pressure on homelessness budgets

The report says that the UK government’s wider welfare reform agenda has significantly impacted on its homelessness budgets since 2011/12. As a result, savings have been made, and budgets for temporary accommodation have reduced by £6m. However a recurring shortfall of £1.4m has remained.

“Homelessness Services can no longer absorb this level of impact and ... operate a sustainable service that meets its statutory duties,” the report says.

And the report states that since the city relies on this cash, jobs are under threat.

“The city’s Homelessness Services is dependent on housing benefit/rental income for a significant percentage of its front line staffing to manage operational demand. The welfare reforms identified in this paper constitute a major risk to the delivery of statutory homelessness services in Glasgow, with particular concerns in relation to front line staffing,” it says.

A Glasgow City Council spokesman said: “Welfare reform has already had a significant impact on our budget for homelessness services.

"The introduction of universal credit is placing further pressure on homelessness budgets and it is anticipated that delivery of these services will become increasingly challenging.

“We will continue to seek ways to mitigate the impact of these changes so we continue to operate an effective service for those affected by homelessness.”