Universal Credit Flaws

DWP

Article reproduced courtesy of Max Salsbury for 24dash.com

A North West housing association has said a survey of its tenants has exposed flaws in the government's universal credit (UC) system, with some of those using it forced to turn to pay day lenders to get by.

One of four initial pilots in 2013's roll out of UC, First Choice Homes Oldham (FCHO) found that their tenants had suffered multiple frustrations and complications with the new system, with some saying it had forced them to face "stark choices over heating or eating".

However, the Deparment for Work and Pensions has called the survey "mis-leading" and not reflective of the true situation.

Carried out via a telephone survey this summer, the data collected from 40% of FCHO's tenants currently on UC found that:

• 55% found the period between making their UC claim and receiving their first payment very difficult. 44% managed financially by borrowing and 18% had taken out a pay day loan.

• 74% had not been offered personal budgeting support by the Department for Work and Pensions. However, 57% of the tenants that were offered this service took up the offer.

• 48% did not know they could apply for an advance payment for UC.

• 43% who did know about this were informed too late to be able to claim advanced payment or said that their application took too long to process leading to them missing their deadline.

• 37% did not receive their payment on the same day each month, making budgeting even more difficult.

• 22% said the Job Centre had not informed them that their rent needed to be paid out of UC money.

• 59% of tenants had not found work since claiming UC.

When asked by FCHO to name the first three bills that would be paid once they were in receipt of UC, 19% of tenants did not name rent as a priority bill.

Many tenants said that they had to choose between which bills to pay and some said that they would have to choose between food and heating or water and electricity.

The survey also asked tenants for suggestions on how UC could be improved UC. Suggestions included:

• Rent being paid directly to the landlord.

• Improved contact with claimants – tenants have struggled to pay to talk to UC teams due to the cost of phone calls and would like an email alternative or a freephone number. Tenants added that the call centre was disconnected from their problem as it wasn’t in the local area.

• The Job Centre should loosen requirements as some tenants have had to apply for unrealistic jobs e.g. a job in Salford which started at 2am with claimants reliant on public transport.

• Credit payment should be made fortnightly rather than monthly. Despite the government aim of making payments monthly to replicate work many tenants got paid weekly or fortnightly in previous jobs and therefore it did not replicate the work that tenants were likely to get.

Reducing the time between making a claim for UC and the first payment. Many tenants were forced into debt by this wait. Some had to use food banks but found this ‘demeaning’.

Defending UC, a DWP spokesman said: “This is a mis-leading survey of only 27 people and does not reflect what we are seeing on the ground. Paying housing benefit directly to claimants is a major culture change designed to move people into the world of work. We know people are adjusting to this over time, with the vast majority of people saying they are coping well with direct payments.

“The National Housing Federation has acknowledged that we have delivered real service improvements with increased support to help people adjust to budgeting, including our Jobcentre Plus work coaches discussing budgeting support with all claimants at their first interview.”

Cath Green, FCHO's chief executive, said: “We knew UC was going to hit customers hard which is why we have had a raft of initiatives and customer support in place since well before the pilot started.

"However, this survey really shows the harsh realities of the new system, and the stark choices our customers have to make between heating, eating and paying their rent. We have been working with the Job Centre, and will continue to do so to ensure this feedback is taken on board. Supporting our customers and ensuring they have a roof over their heads remains our priority.”