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Universal Credit Roll out

Volume 651: debated on Tuesday 18 December 2018

The petition of residents of Linlithgow and East Falkirk,

Declares that the roll out of Universal Credit in the local area will have a devastating impact on communities across the district and will lead to increased foodbank usage and financial misery for some of the most vulnerable people.

The petitioners therefore request that the House of Commons urges the Department of Work and Pensions to halt the roll out of Universal Credit in the Grangemouth, Bathgate and Falkirk Jobcentre areas and fix it without delay.

And the petitioners remain, etc.—[Presented by Martyn Day, Official Report, 13 November 2018; Vol. 649, c. 287 .]


The petition of residents of Glasgow South West,

Declares that the proposed roll out of Universal Credit in the city of Glasgow will have a devastating impact on communities across the city and will lead to increased foodbank usage and financial misery for some of the most vulnerable people in Glasgow.

The petitioners therefore request that the House of Commons urges the Department of Work and Pensions to halt the roll out of Universal Credit in Glasgow and fix it without delay.

And the petitioners remain, etc.—[Presented by Chris Stephens, Official Report, 20 November 2018; Vol. 649, c. 834 .]


Observations from the Secretary of State for Work and Pensions (Amber Rudd):

Universal Credit was introduced with cross-party support to replace the old benefits system, which is complicated, inflexible and involves different agencies and Government Departments. The cliff edges and complicated hours rules would often mean that people were put off from taking up work or trapped into being unable to take on more hours, due to the prohibitive tax rates they would face on earnings. We believe we should have a welfare system that supports people when they need help, assists people into work, and is fair to those who pay for it.

Universal Credit is a force for good. It provides support for those who cannot work and those who need help, including an unprecedented level of personalised support. People required to look and prepare for work receive tailored support managed through personal work coaches, who know each person’s case and have more tools and flexibility than ever before to help people prepare for work and get a job.

This Government continue to spend to more than £95 billion a year on benefits for people of working age. This demonstrates the Government’s commitment to a robust welfare safety net.

The Department continues to rollout Universal Credit in a safe and measured way, there are now more than 1 million people claiming the benefit, so it is now operating at scale across the country. By December 2018 Universal Credit will be available in every jobcentre nationally and the programme remains on track to deliver to this plan. Where issues are raised the Department has listened and made changes to improve the delivery of Universal Credit throughout the rollout.

Following feedback last year, we announced a £1.5 billion package of improvements to Universal Credit for the first assessment period in the Autumn Budget. These include increasing advances to up to 100% of the indicative award available from day one of a claim and increasing the repayment period to 12 months. Further measures included removing the seven waiting days, providing an additional payment of two weeks of Housing Benefit to support claimants when they transition to Universal Credit, and changing how claimants in temporary accommodation receive support for their housing costs.

Another change, following feedback and engagement with landlords is the Landlord Portal, which was introduced in autumn 2017. This provides Social Rented Sector landlords with the ability to submit information directly to the Universal Credit online system, which supports timely and accurate payment of housing costs to claimants. This is rolled out in tandem with Trusted Partner status which helps us to target support for vulnerable people. As a Trusted Partner, a social landlord can decide where a tenant would benefit from having a Managed Payment to Landlord put in place. Our research has shown that whilst many people join Universal Credit with pre-existing rent arrears, the proportion of people with arrears falls by a third after four months on Universal Credit.

This year we have continued to listen to concerns and in the Budget 2018 we announced a £4.5 billion cash boost to Universal Credit to ensure that vulnerable claimants and families are supported in the transition to Universal Credit, and so that millions keep more of what they earn.

This includes an extra £1.7 billion a year into work allowances, increasing them by £1,000 a year, resulting in 2.4 million families keeping substantially more of their earnings before the earning taper applies, strengthening work incentives even more and providing a boost to the incomes of the lowest paid.

We also announced that payment of Income Support and the income related elements of Employment and Support Allowance and Jobseeker’s Allowance will continue for two weeks after a claim for Universal Credit has been made, effective from July 2020, benefiting 1.1 million households. This will apply to all managed migration cases, and to natural migration cases where a claim to Universal Credit ends entitlement to legacy benefits. This extra financial support is intended to help claimants support in the five-week period up to their first monthly payment of Universal Credit, and will not need to be repaid. This builds upon the similar two week run-on of Housing Benefit that was announced at Autumn Budget 2017, and which was introduced in April this year.

To help claimants further, we announced at Autumn Budget 2018 that claimants will also see a reduction in the cap for deductions from 40% to 30% of a claimant’s standard allowance from October 2019, to soften the burden of debt repayments. Additionally, advances can be repaid over 16 months from October 2021.

As well as the policy changes we have made in response to feedback about Universal Credit, the Department has also introduced a number of IT system improvements to improve the operational delivery of Universal Credit. For example we have introduced a feature allowing claimants to upload self-employed earnings online. Furthermore, in February 2018 we introduced a feature enabling claimants to verify their childcare costs online, and in early July 2018 we made it possible for claimants to apply for advances online.

Currently claimants who are need of digital support or personal budgeting support can access this through Universal Support which is currently delivered by local authorities and local partners. From 1 April 2019, Citizens Advice and Citizens Advice Scotland will be leading on the delivery of Universal Support. This brand new partnership will deliver a more consistent and more effective service to support all claimants as they make their Universal Credit claims, in particular those who are most vulnerable. Citizens Advice have a nationwide, trusted brand with a history of delivering advice and guidance which makes them uniquely positioned to deliver effective support to those who need it.

Managed Migration

Universal Credit will be fully available nationwide in December 2018. After this, Universal Credit will enter the next phase of rollout, in which the DWP will begin to move people from existing benefits to Universal Credit. This process is known as managed migration. The draft Universal Credit (Transitional Provisions) (Managed Migration) Amendment Regulations 2018 were laid in Parliament on 5 November 2018.

We are committed to delivering managed migration in a way which supports claimants. In 2019, and in line with our approach of listening and adapting, we will test and refine our approach with a very small number of claimants from July 2019 to check that it is working well, before we take on larger volumes in 2020. We will complete the managed migration process by the end of 2023.

As part of that, we are co-designing the process with claimants, charities, experts and other stakeholders, making sure that it works for everyone and building in safeguards to ensure that vulnerable claimants are fully supported. To complete managed migration successfully, we will work closely with key stakeholders, experts and claimants throughout the process.

We will be testing a number of approaches to move claimants safely to Universal Credit in the most effective way during our test period. This will include testing a non-mandatory approach where claimants will be invited to go through the process. We will use the results of this to adapt the managed migration process as appropriate.

There are £2.4 billion of unclaimed benefits not going to the people who need them, because they do not know about them. The Managed Migration regulations are vital to ensure that people missing out on benefits in the legacy system will receive them. When migration is complete, 700,000 more people will get paid their full entitlement because of Universal Credit, a million disabled people will be better off, and everyone that is managed migrated onto Universal Credit will be eligible for transitional protection. Once Universal Credit is fully rolled out we will be giving claimants an extra £2.1 billion a year than we would on the legacy system it replaces.

In the light of the above, we can see no reason to halt the rollout of Universal Credit and the proven benefits it brings.