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Universal Credit: Household Debt

Volume 647: debated on Monday 15 October 2018

8. What assessment her Department has made of recent trends in the average level of household debt for people in receipt of universal credit. (907043)

A truly memorable day.

Alongside the personalised and tailored support of universal credit, claimants have access to extended childcare support, increases in the personal tax allowance and the introduction of the national living wage. For those transferring from legacy benefits, there is an additional two weeks of housing benefit support.

It is all too easy for people to fall into debt with universal credit failures. My constituent Kayley Aithwaite gets paid on the last working day of each month, meaning she had two lots of wages considered in the last calculation period, and was denied her usual universal credit. How common is this particular problem and what is the Minister going to do about it?

I thank the hon. Gentleman. Universal credit is designed to mirror the world of work, with monthly payments. It is far better that, through the personalised and tailored support of their individual work coach, claimants are able to be given the support to navigate that now and not on the first day of entering work.

18. Due to the massive backlog in universal credit appeals in Wolverhampton, what steps will the Minister take to ensure that my disabled constituents do not have to wait months on end without benefits for their court appeals? (907053)

This is an issue that has been raised and that is why additional judges have been recruited to the tribunal system to make sure that goes as quickly as possible. Through their individual work coach, people will get the tailored support as quickly as they can.

I thought we might hear from the voice of South Suffolk, but the hon. Gentleman seems disinclined to participate in this exchange even though he has a comparable question. He is not obliged. If he is more interested in his phone, so be it. [Interruption.] Get in there, man. I call James Cartlidge.

15. I also extend my congratulations to my hon. Friend. Does he agree that universal credit is not just about getting more people into work, but people currently working part-time working longer hours by getting rid of the disincentives they used to face on 16 hours and so on? (907050)

I thank my hon. Friend for his comments. That is absolutely key: with universal credit you will always be better off in work. UC removes the effective 90% tax rate of the legacy benefit and the cliff-edges of 16, 24 and 30 hours. It is a far simpler benefit, which is stopping the £2.4 billion-worth of benefits that were missed in claiming.

From July 2019, up to 2.8 million people will be required to move from their existing benefits by making a new claim for universal credit. Many are set to lose up to £200 a month. The Trussell Trust, the Child Poverty Action Group, Disability Rights UK, two former Prime Ministers, the future Chancellor and even the Archbishop of Canterbury have all called for a halt to this process, which is driving the growth of poverty in our communities. At what stage will the Secretary of State take her fingers out of her ears, listen to reality and halt this chaos?

This is the reality, as it stands today: complex legacy benefits of £2.4 billion-worth of benefits not being claimed—an average of £285 a month. As the roll-out of universal credit continues, it will remain a test-and-learn process. Where we can see improvements—we have made many already—we will continue to make them.