Lords committee calls for Universal Credit reform
A new report published by the Lords Economic Affairs Committee warns that Universal Credit will fail to deliver if it does not undergo reform, which it says will remedy the areas which are not working property.
The report proposes a number of measures that could be introduced to improve the current system. Currently those applying for Universal Credit for the first time have to wait for five weeks to receive the first payment. The report published today recommends for a non repayable grant to be introduced, in order to bridge this gap.
Included in the report is also a call for funding to be granted to local, trusted organisations that help guide people through the Universal Credit process. Rather than replacing Universal Credit with a new system, the Committee says instead the exisiting system should be reformed in order to make it 'fit for purpose'.
The Lords Economic Affairs Committee launched a call for evidence earlier this year as part of its inquiry looking into the economics of Universal Credit.
Other recommendations included in the report published today include:
- Design:
- The five week-wait for the benefit is the main cause of insecurity for claimants, the wait entrenches debt, increases poverty and disproportionately harms vulnerable groups. The current measures introduced by the DWP fall “far short” of what is needed to rectify the wait. A non-repayable grant should be introduced to help bridge the gap.
- The way that UC is calculated can result in substantial fluctuations from month-to-month, making it difficult to budget for. The DWP should fix the level of awards at the same level for three months, whilst claimants should be able to have early reassessments if they experience a significant fall in income. They should also be able to choose to have payments fortnightly rather than monthly, and individuals should be given their entitlement directly rather than as a household.
- Adequacy of awards:
- A catch-up increase in funding is urgently needed to make up the cuts to benefits over the last decade. This should be carried out immediately and set at a level that provides “dignity and security”.
- Deductions should only be made to awards after an affordability assessment is carried out on a claimant.
- The Government should write off historic tax credit debt owed by claimants that is presently being pursued through UC deductions.
- A work allowance should be introduced to allow claimants to keep more of their award as they move into work.
- Support:
- Less emphasis should be placed by the DWP on obligations and sanctions. There must be more support to help coach claimants when looking for work and the conditionality to look for work should be adapted to accommodate changing labour conditions, particularly pertinent after Covid-19.
- The Government should publish an evaluation on the impact of sanctions on claimants, particularly their mental health and wellbeing.
- Funding should be granted to local, trusted organisations that help guide people through the Universal Credit process.
Welfare and NRLA campaigning
As part of the NRLA's roadmap for the sector to recover from the coronavirus pandemic, the association is calling for further support for tenants in most need to be able to pay their rent. Specifically on Universal Credit and LHA, the NRLA is calling for:
- The development of government guaranteed interest free, ring-fenced loans for tenants to solely pay for all or part of their rent. The funds would be paid directly to the landlord to cover the rent due. The tenant would pay back the loans over a number of years.
- Increasing the Local Housing Allowance to the 50th percentile
- Coverting Universal Credit advances into grants
- Suspending the Shared Accomodation Rate for under 35s as called for by the Social Security Advisory Committee.
Learn more about our roadmap and support our campaign by contacting your MP.
To read the report published by the House of Lords Committee on the economics of Universal Credit, click here.
