Iain Duncan Smith’s flagship Universal Credit could spark a ‘substantial increase’ in the number of Britain’s poorest people hammered by benefit sanctions, according to a leading think tank.
Punitive and spurious benefit sanctions have become common place over recent years, with the poorest in society being pushed ever-further into poverty rather than supported and helped into work.
More than 686,000 desperate people saw their benefits slashed or removed in 2014, including 37,000 sick and disabled people claiming Employment and Support Allowance (ESA).
Around 50% of Jobseeker’s Allowance (JSA) claimants referred for potential sanctioning in 2014 saw their benefit payments docked – an increase on previous years.
The ‘sanction rate’ in 2014 – the number of sanctions per month compared to the total number of claimants – stood at 5.1%, according to research from the New Policy Institute (NPI). This is a slight fall on 2013 levels, but still represents the second highest on record.
According to NPI’s research, a fall in the number of sanctions between 2013 and 2014 was mainly due to a reduction in JSA claimants and not because of ‘the system becoming less harsh’.
More than a quarter of sanctioned JSA claimants were disabled or lone parents, highlighting a lack of understanding and compassion for the ‘hardest to help’.
The Social Security Advisory Committee (SSAC) ran the consultation after the DWP warned that the seven day waiting period already introduced for current out of work sickness and unemployment benefits is being extended to Universal Credit. As the SSAC rightly point out this will leave most new claimants without any benefits at all for six weeks due to the monthly payment cycle of Universal Credit. Perhaps most shocking of all, this will include payments intended to cover rents, meaning new claimants will not just face the trauma of losing their job but immediately be plunged into huge rent arrears.
The plans have been met with outrage by charities, housing associations, local authorities and even landlords. One organisation…
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The collective groan that went up when Iain Duncan Smith was reappointed to the Department for Work and Pensions over the weekend could probably be heard from space.
For housing workers, it’s five more years of the same: no change in direction, just straight ahead with the pressing business of welfare reform. However, the return of IDS also provides an opportunity for pragmatism in the delicate relationship between the new Conservative government and social landlords.
From the bedroom tax to the social cleansing of London as families hit by the benefits cap are shunted outside the capital, there was a lot for housing experts to criticise during the term of the coalition government – and criticise they did.
Much of that was tied up in an understandable moral objection to the changes being implemented. After all, if you’ve dedicated your career to alleviating housing need, it can be hard to work within the constraints of policies which you observe to be undermining a life’s work.
The practical objections, however, have been far more quietly stated, in part because some of them are so complex that they do not resonate with the wider public. In short, their comments don’t make great headlines.
Universal credit is one such example. The policy sounds laudable when described as a simple way of helping benefit recipients transition into employment by handing over full financial responsibility for all their outgoings including rent (previously paid directly to the landlord).
But as all housing providers knew, it will be much more complicated than this. Government has never been good at managing large IT projects or handling lots of data. The reality of working life for many low-paid staff can be weeks of employment and unemployment hard up against one another, with no time for state bureaucracy in between. And most frontline jobs are paid weekly or fortnightly, not monthly like universal credit.
For housing associations, the policy introduces a huge financial variable. How can large organisations with loans negotiated on the basis of a reliable income cope with hard-pressed tenants who do not pay up? The housing regulator is now stress-testing accommodation providers to see how they would cope with situations like this. The result is, inevitably, a downgrading in their ratings.
It’s important to remember that universal credit is derided by private and social landlords alike. Both fear for their revenue. The difference between the two is that, while private landlords can refuse to house people on benefits, social landlords will need to make compromises to stay afloat. That’s why, though he is so widely disliked, Duncan Smith’s reappointment should actually be welcomed.
Cameron told MPs at a meeting of the 1922 Conservative parliamentary committee on Monday that their “re-election starts now”. Absolutely. This government can no longer blame the mistakes of the previous incarnation, and nowhere is this more significant than for housing.
After five years of thwarted pilots, up to £663m of IT costs being written off by the Treasury and more stumbling blocks than an army fitness assault course, it’s time for a pragmatic approach to the introduction of universal credit. The Conservative government is unlikely to walk away from the policy, and Duncan Smith cannot claim ignorance of its failings so far. He cannot hide behind excuses or inexperience in the way a new minister to the brief could be tempted.
To survive their new future, social landlords will need to adapt. They will need to have diverse income streams: development will now always be for the private sector alongside the social to make ends meet. So for every social home that is built, a home for sale, shared ownership or private rent must also be built to help social landlords stay afloat.
Yet, also, there’s never been a better time to challenge a minister head on and demand some certainty. The minister will have little choice but to capitulate.
Source – The Guardian, 15 May 2015
The botched roll out of Universal Credit is set to continue under the Conservatives, it has been announced today.
Universal Credit is replacing six existing benefits including Working Tax Credit, Child Tax Credits and Housing Benefit, with one single monthly payment.
Described as a “welfare revolution” by Work and Pensions Secretary Iain Duncan Smith, Universal Credit will be made available to new single claimants in Richmond, Kirkwall, Lerwick and Stornoway, from today (11 May 2015).
According to the Department for Work and Pensions, all Jobcentres in the country will be offering Universal Credit to some groups of claimants by spring 2016.
Iain Duncan Smith MP, said:
“Universal Credit is bringing welfare into the 21st Century by restoring fairness to the system and making work pay in a modern labour market.
“We’ve already seen remarkable successes with Universal Credit claimants moving into work faster and staying in work longer.
“As part of our long-term economic plan, today sees the next stage of this welfare revolution with the continual roll out of Universal Credit.”
The new benefit is currently available in one-in-three Jobcentres (260). The government initially targeted the roll out of Universal Credit at the ‘easiest to help’ claimants, such as single people without children. For example, only 96 Jobcentres are currently offering Universal Credit to couples, families and lone parents.
DWP figures show that more than 64,000 people have made a claim. However, this is far short of the one million originally promised by Mr Duncan Smith to be in receipt of Universal Credit by April 2014.
Universal Credit has been dogged with delays and IT problems. DWP officials have already been forced to write off millions of pounds in failed IT software.
HM Treasury officials admitted last year that a potential £633 million could be written off by the time Universal Credit is completely rolled-out across the country and to all groups of claimants.
Children’s charity Gingerbread warned in October 2013 that working single parents will be worse off under Universal Credit. Researchers found that there will be little financial incentive for single parents to increase their hours beyond ‘mini-jobs’.
The charity also found that non-working single parents’ income will be on average lower under universal credit than it is now.
Commenting on the findings, Gingerbread chief executive Fiona Weir said at the time:
“Government claims that universal credit will make work pay, but in fact working single parents will be the biggest losers under the new system.
“The simple fact is that universal credit won’t deliver on its promise to make work pay. Single parents on low wages will be under considerable pressure to extend their hours under universal credit, but our research shows that financially, extra hours often won’t stack up.”
However, the DWP claims that Universal Credit will leave three million families better off and provide a £7 billion boost to the economy.
The department also claims that Fraud and Error will be reduced under Universal Credit, with officials having access to real-time HMRC earnings data.
Universal Credit will enable benefit payments to be calculated more accurately, says the DWP, ‘including topping up claimants earnings when they are on a low income’.
Source – Welfare Weekly, 11 May 2015
Today I learnt of some new developments in the universal credit roll out. These changes are devastating and they left me lost for words. I’ll explain now but please share.
When universal credit first came out you could not apply for it if you were already claiming housing benefit. There was a glitch in the system and the computer said no. They’ve sorted this so here goes.
They are now transferring people onto universal credit from JSA. There’s no option to say no, they are simply changing their claim. Their existing claim will be shut down, as will their claim for housing benefit. The claimant will also have to go to the local council offices to sort out the council tax payments, if not they will be left with a massive bill.
Why am I so worried? If you are already in debt with your rent due to the bedroom…
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George Osborne has refused to categorically rule out rolling child benefit into Universal Credit (UC) to help contribute towards Conservative plans to save £12 billion from the welfare budget.
The Chancellor was asked repeatedly to rule it out and did not, but said that if the Tories had wanted to include child benefit in the new welfare system, they would have done so when it was created.
The independent Institute for Fiscal Studies (IFS) has said that scrapping child benefit and increasing UC for eligible families could save £4.8 billion a year.
But such a measure would mean that 4.3 million families who receive child benefit at the moment but would not be entitled to UC in the future would lose more than £1,000 a year, the IFS said.
At a Westminster briefing, Mr Osborne was asked to rule out rolling child benefit into UC.
The Chancellor replied:
“If you judge us on our approach in this parliament and if we wanted to put child benefit into Universal Credit, we would have done it when we set up Universal Credit.
“We have got a track record, we have got a plan that’s based on clear principles about making work pay and sharpening work incentives…”
Asked again to rule it out, Mr Osborne replied:
“I’ve just given you an answer. If we wanted to do it we would have done it when we created Universal Credit.”
Asked again, Mr Osborne said:
“I’ve given a very clear answer and you have to be a contortionist to think I’m not giving a pretty clear answer to that.”
The Conservatives’ plans for the next parliament involve saving £30 billion to contribute to deficit reduction, with £12 billion set to be cut from the welfare budget.
But the party has faced criticism from the IFS and Labour for failing to set out how it would achieve the majority – around £10 billion – of those welfare cuts.
The Chancellor said:
“If you look at our track record, the £21 billion we’ve saved in this parliament, you can look at principles we will apply to future such savings.
“We want to go on creating a welfare system which rewards work and the aspirations of families and protect the most vulnerable.”
Universal Credit is the coalition Government’s flagship welfare reform and simplifies the system by rolling a string of benefits and tax credits into one payment.
It is being rolled out in stages after being hit by delays and IT problems but will eventually take in jobseeker’s allowance, income-related employment and support allowance, income support, child tax credit, working tax credit and housing benefit.
Shadow chief secretary to the Treasury Chris Leslie said Mr Osborne had put middle income families in the firing line.
The Labour frontbencher said:
“The Tories won’t admit where their £12 billion of welfare cuts will come from, but after this press conference it’s now clear middle income families are in the firing line.
“George Osborne repeatedly refused to rule out rolling child benefit into universal credit. This would mean 4.3 million families losing over £1,000 a year, according to the independent Institute for Fiscal Studies.”
Treasury Minister Priti Patel said rolling child benefit into UC was not Conservative policy.
She told BBC News:
“We’re very clear as well, we have made it clear and we’ve said that we need to find £12 billion of welfare savings but it’s not our policy, that suggestion, and that there are other ways in which we can find those savings.”
But Ms Patel would not be drawn on whether the Tories will pay child benefit only for the first two or three children.
Asked if it was a possibility, she said:
“I’m not going to come here and start talking the ins and outs of the spending review because that will all be for the next government.”
Liberal Democrat leader Nick Clegg said he was not surprised by Mr Osborne’s failure to rule out the move as he insisted the change would not feature in his own party’s manifesto.
Speaking in Newtown, Mid Wales, he said:
“It’s no surprise to me that the Conservatives are considering pretty dramatic changes like taking child benefit away from lots of families because they have committed to taking £12 billion away from some of the most vulnerable families in this country.
> And we’ve been helping them for the last five years…
“They have committed to taking the equivalent of £1,500 away from eight million of the poorest families in this country to balance the books; they are not asking the very wealthy, those with the broadest shoulders, to make a single contribution through the tax system in balancing the books.
“Even if they did what is now being floated by George Osborne, they would still have £8 billion or £9 billion to fund. Who are they going to affect next, those with disabilities?
“Which other vulnerable groups will be affected by this unfair plan from the Conservatives?”
Asked whether the Lib Dems would rule out the move, Mr Clegg said:
“Child benefit rolled into the Universal Credit will not be in our manifesto because we are not planning the very, very extensive reductions in support given to the most vulnerable in our society that the Conservatives are.”
> But if anyone’s interested we’ll sell our souls again. Cheaply.
Pressed on whether it would be a measure he would block in coalition as a red line issue, Mr Clegg said:
“There’s no way the Liberal Democrats would ever endorse, of course not, in government or in opposition an approach which takes £1,500 away from eight million of the most vulnerable families in Britain.”
Source – Northern Echo, o7 Apr 2015
When Universal Credit is fully introduced (stop laughing) Jobcentres will have the powers to dictate how many hours a claimant should be working to remain eligible for what are now called Tax Credits and Housing Benefit. Those without children, who do not have a health condition, will be required to spend up to 35 hours a week either working or taking part in work related activity such as looking for additional work or even attending workfare. Failure to comply will result in a sanction.
The implications are chilling. Under the new rules part-time workers will have to attend a job interview with just 48 hours notice or their benefits will be stopped. This is likely to mean someone required to…
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The rules on what constitutes work related activity for those claiming Universal Credit would be laughable if they were not backed by sanctions that can plunge people into destitution for up to three years.
As part of Iain Duncan Smith’s obsession with forcing unemployed, sick and disabled people into ever more irksome and pointless activity, unemployed claimants are now expected to spend 35 hours a week looking for a job. The guidance for Jobcentre decision makers gives an example of a typical day:
“Dave is in receipt of UC. His expected number of hours of work are 35 a week. “On a typical day, Dave spends
1. two hours on-line looking through recruitment sites
2. one hour reading the “situations vacant” pages in the press (local papers,
national papers and trade journals)
3. one hour and a half completing a job application and covering letter
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Reposted from Public and Commercial Services (PCS) union people magazine
Making work or claimants pay?
Iain Duncan Smith claims that Universal Credit (UC), the governments new single benefit, is being rolled out successfully under budget. The reality, according to PCS members charged with its implementation and delivery, is that UC is in disarray, mired by a lack of staff, poor training and inadequate IT, which has wasted millions of tax payers money.
- 1 Million people were intended to be on UC by April 2014. By November, just 40,000 were in receipt of it, demonstrating the scale of the job involved in implementation. The Joseph Rowntree Trust warned “getting this kind of change wrong can result in hardship that can last for many years”
- 4 in 5 of PCS members working on UCsay that the training they have received to prepare them for the job has been less than adequete…
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Universal Credit staff have delivered a damning verdict on Iain Duncan Smith’s flagship welfare reform.
Staff told the PCS union that Universal Credit is ‘in disarray’ and mired by a lack of staff, poor training and an inadequate IT system.
A survey carried out by PCS, shows that 90% of Universal Credit staff believe the IT systems underpinning the new benefit are less than adequate. Only 0.9% said the IT systems were more than adequate.
Respondents to the survey also said they didn’t feel confident in carrying out their roles, with four in five saying the training they had received to prepare them for Universal Credit was of a poor standard.
Almost three-quarters said their working conditions had deteriorated under the new system, leaving them feeling stressed or very stressed.
77% said they thought staffing levels were less than adequate and two thirds said they were frequently asked to work overtime, with only 7% saying they were never asked.
Perhaps the most damning indictment of Universal Credit, is that more than half of those who responded to the survey said the new benefit was not an improvement for claimants.
The Department for Work and Pensions (DWP) has spent more than £700 million on Universal Credit, which merges a number of existing benefits into one single monthly payment.
The new benefit has been dogged by long delays and IT problems. Last year the Government admitted it may have to write off £663 million on Universal Credit IT.
Official government figures show that only 31,030 people were on Universal Credit by 8 January 2015. Of these 32% were in employment and 68% were not in employment.
At the time of the survey, around 820 staff were working on universal credit and 300 to 400 responded to the questions.
PCS say they are not opposed to Universal Credit in principle, but say the scheme has not been designed with claimants in mind.
They added that staff are not being given proper training and resources, while millions of pounds on IT have already been written off.
PCS general secretary Mark Serwotka said:
“No one can trust Iain Duncan Smith to tell the truth about universal credit so it falls to the staff to expose this wasteful and politically motivated shambles for what it is.
“It has long been obvious that staff are under-resourced and undertrained and that universal credit is at risk of collapse.
“The DWP cannot keep burying its head in the sand and hope these problems go away because they are only going to get worse if nothing is done.”
A DWP spokesman said:
“The PCS survey comprises of only 13% of our 2,700 staff working on Universal Credit.
“They chose to ignore staff in our Jobcentres when conducting this research providing a skewed unrepresentative sample of union members.”
Source – Welfare Weekly, 13 Mar 2015