Labour plans to scrap UC: CLS says improve don’t lose

Rarely does a week go by when the media doesn’t contain a story relating to Universal Credit and the impact it is having on claimants and landlords alike. It can be difficult to cut through the noise and know exactly what the truth is. Then, just last week, the media reported that the Labour Party, should they come into power, plans to scrap Universal Credit altogether.

It is no secret that the rollout has been plagued with delays, IT system errors and repeatedly blamed for increasing hardship.RLA recently confirming that UC is forcing tenants into rent arrears. At Caridon Landlord Solutions, we have seen first-hand some of the challenges Universal Credit has presented to both tenants and landlords.But, from where I’m standing, scrapping it at this stage would not only be disastrous, it would be insulting to all those who have had to navigate themselves through these uncertain times.

It has been nearly 10 years since the new system was announced, six years since the first implementation and tens of billions of pounds of investment. But finally, following some encouraging changes and improvements, it does appear to be making headway and, with the right support, could eventually achieve what it set out to do - to simplify the welfare system, help claimants and encourage work as the best route out of hardship.

One of the key hindrances has been that payments are made monthly.With a waiting period of at least five weeks before the first payment, this has had a particularly negative impact on those claimants of Housing Benefit, leading to rent arrears. However, the Government has significantly increased the investment in the availability of advances so that claimants who need money on day one can draw down their first month’s payment.

In many respects, Universal Credit is working. Under the old system getting a job meant cutting contact with the Jobcentre, under UC work coaches stay with someone when they start working, allowing them to offer advice and support in terms of training opportunities. We do know of cases where UC has helped people get off the streets by giving them the tools to get a job and earn an income. Of course, the rollout has been more successful in some areas than others, but I think that comes down to lesson learnt along the way.

From our experience, when we have investigated many of the cases where people have not received payment, it has turned out to be the result of a misunderstanding or administrative error which caused the delay. For example, if a tenant is self-employed, DWP will assume that they make a certain amount each month.This is known as the minimum income floor and is how much the DWP expect the tenant to earn each month – in many cases it is not the same as what they actually earn. The amount is different for each person, because not everyone is expected to work the same number of hours. This has caused problems but is being addressed. Further issues include the fact that a tenant’s rent is not assessed in line with their actual tenancy agreement but in line with their benefit assessment period, which again is causing many tenants to fall into rent arrears from the start of their tenancy.

Whichever government we end up with, there needs to be a focus on improving not losing the system which is now in place. Any new system would come with its own problems and could then take another decade before we had a system which works. This should not be about scoring political points but about improving the lives of some of the most vulnerable people in our society, ensuring they have a roof over their heads and giving them hope for the future through encouragement to self-support.

Universal Credit must stay but DWP needs to continue working with experts across the sector to make it more user friendly and accessible. Some of our suggestions would be:

  • Increase the number of knowledgeable advisors able to offer support and identify issues with claims. This can be achieved through expert training.
  • Adopt a more straightforward approach to verification and implementation of Alternative Payment Arrangements, the latter of which we know is underway through the implementation of a new online system
  • Provide the option to have weekly or even fortnightly payments instead of just monthly
  • Housing Costs should be made in line with the tenancy start date not the tenants benefit assessment period
  • Habitual Residency Test should be the same process as it was for old style legacy benefits

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