Universal Credit - BBC Reports Futher Delays

BBC

From the BBC website this morning:

Ministers have bowed to pressure and are planning to further delay the rollout of flagship welfare reform Universal Credit, BBC News has learned.

The system, which will merge six benefits into one payment, has been beset with problems.

Leaked documents now reveal proposals to spend hundreds of millions of pounds to try to prevent claimants suffering hardship when they move onto it.

The government said it always intended to introduce the benefit slowly.

The universal credit system was originally supposed to be up and running by April 2017, but is now not expected to be fully operational until December 2023.

Massive overspends and administrative problems have plagued the reform.

What is Universal Credit?

The policy was first announced under the coalition government in 2010. It's supposed to simplify benefits for working-age people, replacing income support, jobseeker's allowance, employment and support allowance, housing benefit, child tax credit, and working tax credit.

Under the old system, claimants faced a "cliff edge" where people on low incomes would lose all their benefits once they started working more than 16 hours a week.

The new system is supposed to reduce benefits gradually as earnings increase.

BBC Reality Check has broken all this down in more detail.

What is the problem with it?

Pressure has been mounting on the government for weeks to either delay or halt the next stage of the reform.

Much criticism has centred on the time it takes for people applying for Universal Credit to receive their first payment - 35 days - with some claimants left struggling to pay their bills in that period.

On Monday, independent MP Frank Field said the rollout of the system in his constituency had driven some female claimants to sex work.

Media captionEsther McVey on universal credit: Some will be worse off

Anger built further last week when Work and Pensions Secretary Esther McVey admitted that "some people will be worse off" under the new system, amid claims 3.2 million households will lose more than £2,000 year.

The Times newspaper suggested she had told a cabinet meeting some families could lose up to £200 a month.

Mrs McVey insisted, though, that the most vulnerable would be protected.

What has the BBC now learned?

Well, it appears that big changes are going to be made in an attempt to reduce the negative impact on people being moved to UC.

First off, plans have been drawn up to continue paying income support, employment and support allowance, and job seekers allowance for two weeks after a claim for universal credit has been made.

A similar policy for housing benefit was introduced in last year's Budget, following evidence that some claimants were going into rent arrears.

Second, there are to be changes to how deductions from a recipient's payment can be made.

Claimants can ask for an advance to help them get by while waiting for their first proper UC payment - later the government takes deductions from their regular monthly award to pay that back.

Under the revised plans, the maximum amount that can be deducted will be reduced from 40% to 30% of their total award each month.

Thirdly, more help is set to be given to the self-employed, after warnings they could be left in serious financial trouble because of incorrect assumptions by the Department for Work and Pensions about their earnings.

But the documents seen by the BBC also make clear that these concessions might not actually be achievable.

An extract says: "We can currently offer no assurance that ultimately these proposals will prove to be deliverable, can survive legal challenges where they can be delivered, and do not invite new political criticism by generating new policy issues."

How does all this affect the timescale?

The government was intending to begin moving almost four million people onto UC from January 2019, initially in small batches. Larger scale movements were due to start next July.

Now though, initial testing has been pushed back to next summer, and large-scale movement won't begin until November 2020 at the earliest.

The leaked papers predict that overall, the latest delay will add an additional nine months to the final deadline for full implementation.

What does the government say?

A Department for Work and Pensions statement said it was taking a "a slow and measured approach to managed migration" and wanted "to ensure the system is working well for claimants and to make any necessary adaptations as we go".

"We will publish full plans for the next stage of Universal Credit rollout, including managed migration, in due course. Anything before that point is speculation and we do not comment on leaks."

Courtesey of the BBC

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