Part-time workers claiming Universal Credit face punitive in-work benefit sanctions, it has been reported today.
Universal Credit claimants in part-time employment could see their Housing Benefit slashed, if they fail to increase their working hours to 35 hours per week on the minimum wage, reports Inside Housing.
The trial, quietly introduced through secondary legislation, will affect around 15,000 new Universal credit claimants earning less than £12,000 a year.
Sanctions currently only affect unemployed people in receipt of Jobseeker’s Allowance (JSA) or Employment and Support Allowance (ESA).
If the trial is rolled out across the country, thousands of hard-working people could see their in-work benefits docked for the very first time.
> From one point of view this could be a good thing – because it will bring home to people who previously didn’t give a damn about, or even supported, benefit sanctions for the unemployed, just what is going on.
Universal Credit merges a number of existing benefits into one single monthly payment. This includes Housing Benefit, Working Tax Credit, Child Tax Credit, Income Support, JSA and ESA.
However, the Government’s flagship project has been beset by delays and problems with its IT systems. Official figures show 26,940 people were claiming Universal Credit by 11 December 2014.
The DWP is speeding up the roll-out of Universal Credit across Britain, in an apparent bid to prevent Labour from calling a halt to its introduction if they win the next general election.
> Labour could – and should – still scrap it if they win… but will they ?
Under the new mandatory pilot, which launches in April 2015, in-work Universal Credit claimants face the prospect of weekly sanctions – starting at around £29 per person.
Those affected by the trial will be offered ‘support’ from Jobcentre Plus to increase their pay and working hours. Failure to comply could result in sanctions.
> So just how do you increase your hours (unless you’re the boss) ? And its not much incentive to take a job like that if you know you’ll still be at the mercy of Jobcentre work coaches.
Source – Welfare Weekly, 11 Feb 2015
Work and Pensions Secretary Iain Duncan Smith has confirmed that part-time workers could face benefit sanctions under Universal Credit.
IDS told the Work and Pensions Select Committee that trials were being carried out in parts of the North-West of England, on removing benefits from part-time workers who refuse to take on extra hours.
“In work conditionality” within the Universal Credit system could encourage part-time workers and the low-paid to seek additional hours, said Mr Duncan Smith.
However, Labour MP Debbie Abrahams said people were dying as a result of the having their benefits docked, a claim dismissed by Mr Duncan Smith.
Mr Duncan Smith told Debbie Abrahams that the benefit sanctions regime was “helping people focus” on finding work or additional hours, adding “a job doesn’t stay static at 16 hours – you want it to develop”.
Ms Abrahams asked the Work and Pensions Secretary:
“Can you confirm that there is an intention to introduce in-work conditionality with Universal Credit and, if so, what sanctions could be applied, and under what conditions to the 3.5 million people in work on low pay and in receipt of tax credits?”
Iain Duncan Smith replied:
“That is being investigated, as to whether we can now work to in-work sanctions – in other words, conditionality – so people get an opportunity to move up the hours if they can, and if they don’t wish to do that, we will see whether or not that system of conditionality works. We are trialling that.”
Ms Abrahams also accused Duncan Smith of a cover-up after he said no money had been lost during the botched introduction of Universal Credit. The DWP has already been forced to write-off £40 million in failed IT software, with an additional £91 million predicted to be lost over the next few years.
Universal Credit is replacing a number of existing benefits, including Housing benefit and Income Based Jobseeker’s Allowance, and rolling them into one single monthly payment. However, the government’s flagship welfare reform has been beset with delays and costly IT failures.
Up to a million households were originally expected to be in receipt of the new benefit by the end of 2014. But DWP figures show that less than 15,000 households or individuals were on Universal Credit by the end of September – mostly single people. The national rollout is scheduled to be completed by the end of 2018.
Mr Duncan Smith said trials of Universal Credit in the North-West of England had resulted in claimants finding work more quickly or taking on extra hours, leading to “early savings to the Exchequer”.
He added that businesses were more willing to take on people claiming Universal Credit than Jobseeker’s Allowance claimants, because those people could accept additional hours while keeping more of their benefit.
“Normally in a business, a job doesn’t stay static at 16 hours – you want it to develop”, he said.
“Businesses know that many people will not work more than 16 hours because they don’t think it is viable for them to do so because of all the withdrawals.
“What we are beginning to experience in areas of the North-West is they can now work to progress that individual and set training programmes around them, so it is worth investing in that individual to develop their own skills and their own productivity.
“In the North-West, many businesses are now asking to have people on Universal Credit to come and take interviews, because they know they can develop them all the way through.”
Sourc e – Welfare Weekly, 09 Nov 2014
The number of ‘under-employed’ workers in the North East has increased by 16% since the last election, figures reveal.
The underemployed are people who want to work more hours in their present job, like those in a part-time role who want to go full-time.
Analysis by the TUC from the Labour Force Survey shows that since the May 2010 election, under-employment has also gone up more than 20,000, from 127,578 to 148,368 in this region.
The fastest increase, from 9,000 to 11,500, has been among self-employed people who say they are under-employed – a 127% rise.
The TUC says this shows that despite talk of a recovery, continual real wage falls mean more people than ever are looking for extra hours to make ends meet.
North East TUC regional secretary Beth Farhat said:
“Ministers have made much of the UK’s improving jobs figures as a sign that all is now well with the economy. But here in the North East we have suffered the double whammy of rising joblessness and under-employment.
“There are now over 20,000 more people who would like to be working more hours than they are.
“As the squeeze on pay continues, many people don’t have enough money for everyday essentials, let alone the cash to cover any unexpected emergencies.
“With no let up in their financial woes in sight, people are understandably looking to take on more hours just to keep the wolf from the door.
“Without a decent pay rise and the creation of more permanent, secure jobs, under-employment is unlikely to fall any time soon.”
A Department for Work and Pensions spokesman claimed the TUC’s figures were misleading.
“Independent statistics show that there are over 100,000 fewer people who say they are under-employed compared to a year ago, and that full-time jobs account for more than three quarters of the rise in employment since 2010.
“The proportion of part-time workers wanting a full-time job has just seen the biggest annual fall in over two decades.
“The overwhelming majority of those working part-time do so because it suits their circumstances, for example students or those with caring or parenting responsibilities. “
However, when contacted further and asked if the DWP disputed the TUC’s North East figures, there was no further reply.
> I bet there wasn’t… guy’s nose had probably grown so long he couldn’t get near the phone.
Source – Newcastle Journal, 03 Sept 2014
Self-employment accounts for 44 per cent of the net rise in employment since mid- 2010, with pensioners, part-time workers and ‘odd-jobbers’ the fastest growing groups of Britain’s new self-employed workforce, the TUC says today, ahead of the latest employment figures published later this week.
The TUC analysis shows that despite self-employment being a relatively small part of the UK jobs market – just one in seven workers are self-employed – it has accounted for 44 per cent of all employment growth since the last election.
Workers aged 50 plus account for half the increase in self-employment, with self-employed workers aged 65 and over the fastest growing group in the labour market (increasing by 29 per cent since the end of 2010).
Over 40 per cent of all the self-employed jobs created since mid-2010 are also part-time. The TUC is concerned that many people are only taking this kind of work because they are unable to find good quality employee jobs which provide the stable employment they really want.
The TUC’s analysis also shows that the number of people starting their own businesses has fallen in recent years, in spite of rising self-employment. The biggest growth areas of self-employment since mid-2010 have been people working for themselves (up 232,000), freelancing (up 69,000) or sub-contracting (up 67,000).
The number of self-employed people who either run a business, or are a partner or sole director in one (positions usually associated with entrepreneurship) has actually fallen by 52,000. These figures show that rising self-employment is part of a wider shift towards insecure employment, rather than as a result of a growing number of people starting up new companies as ministers like to claim, says the TUC.
Self-employment has been going up steadily since early 2008, even when unemployment was rising sharply, and has increased even more in recent years.
The TUC is concerned that the growth of self-employment is at the expense of more secure employee jobs. Many newly self-employed workers do the same work as employees but with less job security, poorer working conditions and often less take-home pay, says the TUC.
Other forms of self-employment – for example selling goods online or registering as self-employed to do the occasional ‘oddjob’ – tend not to pay enough to make a decent living, says the TUC. Recent figures from Citizens Advice suggested that self-employed workers are as likely to have debt problems as unemployed people.
Self-employed workers also have no right to paid sick, holiday, maternity or paternity leave, redundancy pay or protection against unfair dismissal – a particular problem for self-employed workers who are sub-contracted to another employer.
The government is also planning to exempt most self-employed workers from vital health and safety protections in the Deregulation Bill currently making its way through way through Parliament.
Self-employed workers are often poorly paid, says the TUC. Recent Resolution Foundation research found that earnings from self-employment fell by a fifth between 2006 and 2010, while official figures published by Parliament found that the average annual income from self-employment is less than £10,000 for women.
The TUC is concerned that insecure work including self-employment, agency work and zero-hours contracts are becoming a permanent feature of the labour market, even as the economy recovers. The growth of casualised work is likely to continue to hold back wages, and prevent people from having the kind of secure employment they need to pay their bills, save money and plan for the future, warns the TUC.
TUC General Secretary Frances O’Grady said: “Self-employment accounts for almost half of all the new jobs created under this government.
“But these newly self-employed workers are not the budding entrepreneurs ministers like to talk about. Only a tiny fraction run their own businesses, while the vast majority work for themselves or another employer – often with fewer rights, less pay and no job security.
“While some choose to be self-employed, many people are forced into it because there is no alternative work. The lack of a stable income and poor job security often associated with self-employment makes it hard for people to pay their bills, arrange childcare, plan holidays or even buy or rent a home.
“The economy is finally back in recovery yet people’s wages are still shrinking and many are unable to find stable employment. Until we see decent pay rises and better job security, working people will continue to feel that the recovery is passing them by.”
Source – TUC, 14 April 2014