Government Has Its “Head in The Sand” Over Universal Credit

In a response from Government to the Committee published today,  DWP downplays the impact of the problems in the roll out of Universal Credit on claimants and local councils, claiming that rent arrears associated with UC “are likely to be of a short duration” and “should not present an insurmountable obstacle to landlords”. This is despite its own analysts urging caution about drawing conclusions from historic data, based on a small number of cases.  The Government was unable to provide any of the basic, up-to-date, specific data that the Committee asked for.

The Department’s response has led Committee Chair Frank Field to claim Government has its “head in the sand” on the issue. Former Welfare Minster Lord Freud, the architect of Universal Credit, told the Committee in evidence that it might take “decades to optimise” Universal Credit.   The Committee heard compelling evidence of the problems in the rollout of Universal Credit, with serious knock-on effects on housing and rent payments in its reopened inquiry into the major welfare reform, prompting the letter with twenty detailed questions to Employment Minister Damian Hinds.

Rt Hon Frank Field, Chair of the Work and Pensions Committee, said:

“Despite a growing body of evidence about the very real hardship the rollout of Universal Credit is creating for some, often the most vulnerable, claimants  - and the struggles it is creating for local authorities trying to fulfil their responsibilities – it is flabbergasting  that the Government continues to keep its head in the sand.

“There is no urgency in the Government’s attempts to solve, for example, the incompatibility between Universal Credit and a council’s duties to those in emergency temporary accommodation. This is affecting some of society’s most vulnerable people, at a point of crisis, yet the Government appears unwilling to take the action it could to solve this and simply remove these people from the Universal Credit system.”

Response from Minister for Employment Damian Hinds

The Committee is particularly concerned about the impact of Universal Credit on rent arrears, having heard much evidence that this is a significant and growing problem for Universal Credit claimants. The Government’s letter asserts that understanding what is going on is not a simple task, but, based on analysis of a small number of cases in 2015, says it believes any rent arrears associated with UC are likely to be of a short duration and should not present an insurmountable obstacle to landlords. The Government accepts that it must improve how it communicates with landlords and welfare advisers about individual cases, but explains that security concerns limit its options for this.

The Committee has further grave concerns over evidence it heard that despite Universal Credit already having a built-in six-week delay between someone applying and them receiving their first payment, many have to wait much longer than this. The Government says that it is currently looking at some analysis around the time it takes to first payment, and the number and types of advances that are paid, but claims this is not easy data to construct.

The Committee is now again accepting written submissions on the impact of Universal Credit. Please submit your evidence through the inquiry page Universal Credit update  before 20 March 2017