Category Archives: Welfare payments
Universal credit is NOT an incentive to work for the single able-bodied: 63p of every pound earned is clawed back
Focussing on undue delays causing hardship, highlighted on this site, The Times and the FT in 2017 asked ‘is universal credit – to date – a disaster?’
The FT today says “Universal credit is a plum example of how not to reform public services. The theory was broadly sound: the simplicity and real time data of the universal credit would ensure people were always better off in work. The reality, however, has proved calamitous”.
Conservative and Labour politicians, such as Jacob Rees-Mogg, Johnny Mercer, Gordon Brown and Frank Field, are now demanding that the government reconsiders the national rollout.
John Major has warned that UC could lead to a repeat of the poll tax debacle of the early 1990s, which saw riots against the then Conservative government.
A reader with a postgraduate degree was asked to look at these sections on a government-recommended benefits calculations site:
Work allowance for Universal Credit (Ed: able-bodied & childless need not apply)
If you/and or your partner are in paid work, you might be able to earn a certain amount before your Universal Credit is affected, this is called the work allowance. Your work allowance will depend on whether you are single or part of a couple and whether your Universal Credit includes amounts for housing costs, children and/or limited capability for work. The table below shows the different levels of monthly work allowance.
The Universal Credit earnings taper is a reduction to your Universal Credit based on your earned income. The taper rate sets the amount of benefits a claimant loses for each pound they earn. The earnings taper rate is currently 63%. This means for every pound you earn over your work allowance your Universal Credit will be reduced by 63 pence. To work out the earnings taper that applies to your award:
- Take your total monthly earnings figure after tax, National Insurance and relevant pension contributions have been taken off
- Deduct your monthly work allowance, which is the amount you can earn without your benefit being affected (if you are eligible for one)
- Apply the taper rate by multiplying the remaining earnings by 0.63
This is the amount that will be taken from your Universal Credit maximum amount when calculating your award.
Even the post-graduate reader found these instructions ‘far from simple’ and in no way producing a simpler and more effective system.
Esther McVey, the work and pensions secretary in charge of the scheme, confirmed last week that families will be poorer under UC. She did not deny reports that millions of families could be up to £200 a month worse off when it is fully rolled out.
The chairman of the Commons work and pensions select committee has described the project – running well behind schedule – as a “shambles, leaving a trail of destruction” and in its assessment this year, the National Audit Office doubted whether the system would ever deliver value for money.
The current Universal Credit system is NOT ‘fit for purpose’
Over 2400 of the people who were given contaminated blood have died and MP Diana Johnson (below, left) asked for an urgent Commons debate last year.
She had to get six leaders of opposition parties — including the DUP — to sign a letter to Ms May asking for an inquiry before Theresa May finally succumbed to pressure and announced a public inquiry into this 1970s and 80s scandal.
Last year it was recalled here that British haemophiliacs and other victims’ lives were blighted in the 1970s and 1980s by cheap imported US blood products, harvested from inmates and drug addicts. More than 5,000 were infected and went on unknowingly to infect family and friends. It is estimated that over 2.400 have died since then.
At a 1997 independent inquiry into the scandal, Lord Archer of Sandwell said: “By the mid 1970s it was known in medical and government circles that blood products carried a danger of infection… and that commercially manufactured products from the USA were particularly suspect… but the products continued to be imported and used, often with tragic consequences.”
It was decided that victims should die to avoid going over budget
Ministers believe the reforms (cutbacks) are necessary because more people are now considered likely to develop serious health issues – and be entitled to higher payouts – pushing the programme as much as £123m over budget.
In April, as he left the Commons, the former health secretary Andy Burnham declared there had been a “criminal cover-up on an industrial scale in the NHS” over contaminated blood and called for a Hillsborough-style inquiry.
Meanwhile the contaminated die apace as this inquiry gets under way, 30 years too late.
Work capability assessments, introduced under the last Labour government, were first carried out by Atos, which had a £100 million a year contract in 2012 – and later earned much more. The firm made a £42million profit in 2010 and paid its chief executive Keith Wilman £800,000, a 22% pay rise on the previous year. Since then other providers, including Capita and Maximus, have also been making these assessments. For several years there has been evidence from a wide range of sources that they are not being carried out efficiently. A few examples follow:
Doctors backed a motion at the annual BMA conference in 2012 stating that Atos’s assessments were “inadequate” and “have little regard to the nature or complexity of the needs of long-term sick and disabled persons.
In their evidence to the Fifth Independent Review of the Work Capability Assessment (2014), the BMA repeated its 2012 call for government to end it “with immediate effect and replace it with a rigorous and safe system that does not cause avoidable harm to the weakest and most vulnerable in our society”.
2015: An academic paper, published in the BMJ’s Journal of Epidemiology and Community Health in which examined 149 English council areas, found that nearly 600 suicides in England may be associated with the government’s “fit-for-work” tests.
Oxford and Liverpool researchers looked at three years’ data and also found the Work Capability Assessments could be linked to a rise in mental health problems. The BBC reported in 2015 that the study found the areas with most WCAs showed the sharpest increases.
2016: The UN Committee on the Rights of Persons with Disabilities found that UK welfare reforms have led to “grave and systematic violations” of disabled people’s rights.
Changes to benefits “disproportionately affected” disabled people, the UN Committee on the Rights of Persons with Disabilities (CRPD) found. The 2016 investigation was launched after receiving evidence from disability organisations about an “alleged adverse impact” of government reforms on disabled people. UN committee members visited London, Manchester, Birmingham, Cardiff, Edinburgh and Belfast in October 2015 to identify any gaps in human rights protection for disabled people. As part of its inquiry, the CRPD also looked at a range of recent welfare reforms and legislation including the Welfare Reform Act 2012, Care Act 2014, and Welfare Reform and Work Act 2016.
The BBC reported the UN inquiry’s conclusion that changes made to housing benefits and criteria for parts of the Personal Independence Payment, combined with a narrowing of social care criteria and the closure of the Independent Living Fund, “hindered disabled people’s right to live independently and be included in the community”.
Work and Pensions Secretary Damian Green rejected the UN report’s findings, but it has now been announced that after a high court ruling on 2017 regulations, introducing criteria which discriminated against those with impaired mental health, decisions on personal independence payments will be reviewed.
2017: Directors and other officers of the Department of Work and Pensions receive new year’s honours for services to ‘welfare reform’, as a reader draws attention to an undated article in the Dorset Eye, by Douglas James, listing 82 people who have died or committed suicide soon after dealings with agencies such as ATOS and the government’s Department of Work and Pensions. A search was made for news of the first five on the Dorset Eye list and links to fuller accounts were added. Most of the people were aged 30-40.
2018: Private Eye 1462 reported in January that despite long-drawn-out resistance from the DWP, Atos and Capita, the Information Commissioner’s Office has now ruled that the DWP must reveal monthly reports These include details of complaints against assessors, the length of time taken by t-assessments and how many fail – i.e. are overturned on appeal.
In December the Commons Work & Pensions Select Committee report revealed that:
- it had heard disturbing evidence,
- accounts of medical assessments range from frustrating to gruelling,
- there were remarkably high, if slowly improving, levels of unacceptable reports,
- not one doctor had been involved in the assessments and
- Capita’s own auditing found that at points in the contract almost 60% of its reports were “unacceptable”.
MP Tom Brake speaks out:
“Many constituents are in despair when they contact me after an inaccurate report. Reports of face-to-face assessments need to be unbiased, fair and above all accurate. It was important to flag up these discrepancies directly with ATOS. The Government need to ensure that assessments are recorded to prevent alarming inaccuracies. I will continue to put pressure on the Government to reform the current system. At the moment too many people have lost faith in the system.”
Last resort: after many disastrous years – like Windscale nuclear reactor station – in June Atos Healthcare announced changes to its name – but not its practice.
The presenter of this BBC radio programme, Adrian Goldberg, grew up on the Druids Heath council estate in Birmingham, the home of the ‘municipalism’ pioneered by Joseph Chamberlain when he was Mayor of Birmingham – summarised by Walsall MP John McShane in the Commons in 1930:
“A young person today lives in a municipal house, and he washes himself … in municipal water. He rides on a municipal tram or omnibus, and I have no doubt that before long he will be riding in a municipal aeroplane. He walks on a municipal road; he is educated in a municipal school. He reads in a municipal library and he has his sport on a municipal recreation ground. When he is ill he is doctored and nursed in a municipal hospital and when he dies he is buried in a municipal cemetery.”
Adrian is described as being an ideal candidate to judge the changing nature of the local council, because when he and his family moved there the local authority:
- built properties and
- collected the rent.
- Adrian took a council-subsidised bus service to
- the secondary school run by his local education authority.
- On the way home he’d drop into his council-run library to pick up some books
- or take a swim in the council run pool.
He comments, “Today the situation is much more complex”
Adrian considered the effect of austerity on the role of councils today. Birmingham council has almost halved its staff since 2008, from around 24,000 to 12,500. Last year another £28m was cut from Birmingham’s adult care budget of £230m. 2017/18 – the seventh year of cuts – is predicted to be the toughest year yet with expected reductions of £113m to the council’s overall budget, on top of £650m already cut since 2010.
Local government grants and powers have been greatly reduced in several areas, including education and housing. Read more about the following cases here.
- The fate of the formerly successful council-run Baverstock Secondary School in Druids Heath
- The group of residents who set up the Friends of Walkers Heath Park in November 2011
- The volunteers who are helping to run the library
- Druids Heath’s handsome and historic Bells Farm community centre (below), with its food bank and other services, also kept going by local volunteers.
The link also leads to news of high-rise tower blocks in the area; dilapidation, damp and fire hazards go unremedied, the splendid concierge system was abandoned and full time neighbourhood office advice centres, closed in 2006, were replaced by a private call service which was expensive, often not answering, with staff unable to supply the information needed.
In Birmingham there was a move under John Clancy’s leadership to take back ‘in-house’ the services currently undertaken by profit-making private companies, deciding not to renew one Capita contract and considering the future of refuse collection in the city. This, because the ‘market place’ economy which has developed, privatising refuse collection, road maintenance and ‘back office’ functions in Birmingham, has proved to be more expensive and often less efficient. This hope is fading as Richard Hatcher reports on the new regime: Birmingham Council Children’s Services contracted out, Children’s Centres closed.
The health and safety of council tenants is evidently not a government priority
Inside Housing reports the housing minister’s description of sprinkler systems for high rise blocks as “additional rather than essential” and refusing a council’s request for funding promised after the Grenfell Tower tragedy.
Strangely, the conservative Prime Minister expresses admiration for Joseph Chamberlain
Mayor of Birmingham in 1873, city MP in 1876, Joseph Chamberlain directed the construction of good housing for the poorest, libraries, municipal swimming pools and schools. Unlike Ms May and colleagues, he was not in favour of a market economy, arguing for tariffs on goods from countries outside the British Empire. He was also an ‘economic interventionist’ (see Lewis Goodall, Newsnight), described as a “gas and water socialist”. He took profit-making private enterprises into public hands, declaring that “profit was irrelevant”.
Ms May’s government continues to implement a series of cuts affecting the lives of the country’s poorest and most disabled with might and main.
Ironically the contemporary politician sharing Chamberlain’s principles is the opposition leader, Jeremy Corbyn, whose policies she echoes but does not implement.
Broken Britain 8: EU nationals experience the maladministration which has affected the country’s poorest for decades
EU nationals’ deportation threat was an ‘unfortunate error’, according to Theresa May
The Home Office mistakenly sent up to 100 letters to EU citizens telling them to leave UK or face removal
One of these, academic Eva Johanna Holmberg has lived in the UK with her British husband for most of the last decade, but the letter from the Home Office said that ‘A decision has been taken to remove you from the UK.’ It added that if she did not leave the country of her own accord the department would give “directions for [her] removal” as “a person liable to be detained under the Immigration Act”.
Her story was picked up on social media and the Home Office then said the letter had been sent by mistake. Several people have been told wrongly they should leave the country after trying to apply for permanent residency but this is the first time the Home Office has issued a letter telling people to leave.
Though the department called to apologise, the person who telephoned did not agree that the government would cover her legal costs of about £3,800.
The Financial Times reports that more than 120 MPs have challenged the rollout of Britain’s flagship “Universal Credit” benefits system, saying that delays are leaving poor households exposed.
Universal credit payments are withheld for the first week and then paid monthly in arrears. In practice, almost a quarter of claimants are waiting even longer — for up to 12-13 weeks. A DWP spokesperson said “Around 80% of payments are made on time and where they are not it is usually because a claimant commitment has not been signed or there is a verification issue over information”.
Citizens’ Advice has helped more than 30,000 people facing problems with the new system, and the Trussell Trust ((food banks) has seen a sharp rise in referrals for emergency food in areas where universal credit has been introduced.
But private enterprise flourishes: MP Ruth George said there was evidence that high-cost payday lenders were targeting areas where the universal credit system has just been introduced – and household debt is already 140% of GDP.
Will universal credit be ranked with the poll tax, the invasion of Iraq, Gordon Brown’s removal of the 10p income tax band and George Osborne’s cuts to disability payments?
“Mr Gauke, Secretary of State for Work and Pensions talks of the value of employment — in principle, this must be right — but in practice, again, at the food bank in which I work many of the customers I see each week are in work, but the costs of rents, transport, energy, children, wipe out earnings before food and the only place to go for food is us . . .
“To read David Gauke, on the subject of UC, you would think that the introduction of universal credit had been a smooth, well thought through project. In fact, it must rank as one of the worst executed policies any government has attempted . . . “ Jenni Russell of the Times writes in more detail (edited extracts):
The system aims to simplify the complex welfare system by combining six different benefits, from housing to tax credits to childcare to jobseekers’ allowance into a single payment, ending the benefits trap and ensuring that work would always pay more than welfare.
After seven years of development, a pilot project of the universal credit is under way. It has gradually expanded so that now almost 600,000 people are receiving it. In October about 50,000 people will be moved on to the scheme every month. But UC is not meeting its own six-week target. The DWP says that 20% of claims are paid late, and Croydon reports that 12 weeks delay is standard.
The length of time a new claimant must wait to be paid in full has tripled, from two weeks to six or more; it takes at least five weeks for the first payment to arrive forcing people into debt and creating ‘tremendous anxiety’. Most people have not saved enough to keep them going for six weeks. When their lump sum finally arrives, they are often forced to spend money intended for rent on living costs or loan repayments instead. Some families are using food banks and some have been evicted. In Croydon, one of the pilot area, the council told the select committee on work and pensions that under UC rent arrears had rocketed from under 10% to at least 40%. Ms Russell adds that even the emergency loans for which some people would qualify are little advertised and harsh to repay.
Reasons for the delay include:
- people are asked for the wrong information,
- documents get lost,
- dreadful computer breakdowns (RS),
- huge overruns in costs (RS)
- unexpected requirements, such as the demand that childminders are asked to provide statements of charges on headed notepaper as if they were City law firms.
Jenni Russell believes that a revised UC could work well and prove beneficial. To this end she advises government to:
- scrap the first week’s wait,
- enhance grants and loans for those in need,
- provide proper support
- and commit to paying everyone the benefits within five weeks.
This must be given priority for the sake of people whom Richard Smerdon sees living ‘at the sharp end, the claimants themselves’. He continues: “They suffer unbelievable privation and unfairness dealing with the cock-ups from central government through to jobcentres. In addition to that is the monstrous rule that no one can claim universal credit for seven weeks after they have ceased to draw existing benefits. So for seven weeks, many of the customers coming to the food bank in which I work would starve were it not for us . . .”
A reader from Bournville draws attention to an article by Jules Birch in Inside Housing, a weekly magazine for housing professionals. He focusses on a recent TV Panorama programme about the benefit cap that now leaves thousands of people with 50p a week towards their rent.
He noticed that roughly 95% of tweets with the hashtag #benefitcap (scroll down to April 7) were hostile to the people featured in the programme rather than the policy. The majority of people commenting on Twitter were seeing the undeserving individual instead: the stroppy single mother with a mobile phone and the couple with many children. He notes that exactly the same thing happened with Benefits Street, How to Get a Council House and a Dispatches documentary on the cap last month.
Part of the problem, he believes, lay with the way Panorama framed the issue. As Joe Halewood was quick to point out, the programme and its advance publicity seemed to assume that most people capped are unemployed and on Jobseeker’s Allowance, when in fact just 13% are.
The fact that the vast majority of people capped are either unable to work or not required to work was only raised tentatively halfway through the programme. Most of those capped are lone parents with young children who are not required to look for work, or people on Employment and Support Allowance who do not qualify for an exemption but are still not fit for work.
David Pipe explained the effects in a piece following the Dispatches documentary last month. 7,500 households across 370 local authority areas have lost their housing benefit and are now receiving just 50p a week to pay their rent. The cap leaves a nominal amount for housing benefit or Universal Credit once someone’s benefits total more than £20,000 (£23,000 in London). In effect it is imposed on top of the rest of the benefits system.
The latest budget highlighted cuts for the poorest 18-21-year-olds, who will no longer be entitled to help with their rent through Universal Credit from April 1.
For many, Discretionary Housing Payments (DHPs) are the only thing keeping them in their home and the effect over time will be rising rent arrears and evictions and allocations policies that make it less likely that people on benefits will get a tenancy in the first place. So where and how can the poorest people live? Even people in caravans are being capped, and what will the knock-on costs be in terms of homelessness and the impact on the children?
Meanwhile in Broken Britain, the May government continues the policies of its predecessors and makes decisions which seriously afflict the poorest and greatly benefit the richest: the arms traders, Big Pharma, the privatised utilities, large developers, car manufacturers, private health companies and expensive, inefficient outsourcers – Serco, G4s and Capita.
The corporate world continues its vitriolic but insubstantial attacks on the Labour Party leader whose approach threatens their unreasonably affluent lifestyles. Will increasingly media-sceptical people who seek the common good be affected by them?
In brief, the reference is to arms traders, big pharma, construction giants, energy companies owned by foreign governments, food speculators, the private ill-health industry and a range of polluting interests. Examples of the damaging political-corporate nexus are given here – a few of many recorded on our database:
Arms trade: Steve Beauchampé – “A peacenik may lay down with some unsavoury characters. Better that than selling them weapons”.
The media highlights Corbyn’s handshakes and meetings, but not recent British governments’ collusion in repressive activities, issuing permits to supply weapons to dictators. In the 80s, when lobbying Conservative MP John Taylor about such arms exports, he said to the writer, word for word: “If we don’t do it, someone else will”. Meaning if we don’t help other countries to attack their citizens, others will. How low can we sink!
Reader Theresa drew our attention to an article highlighting the fact that the Specialised Healthcare Alliance (SHCA), a lobbying company working for some of the world’s biggest drugs and medical equipment firms, had written the draft report for NHS England, a government quango. This was when the latest attempt at mass-medication – this time with statins – was in the news.
Most construction entries related to the PFI debacle, but in 2009 it was reported that more than 100 construction companies – including Balfour Beatty, Kier Group and Carillion – had been involved in a price-fixing conspiracy and had to compensate local authority victims who had been excluded from billions of pounds of public works contracts. The Office of Fair Trading imposed £130m of fines on 103 companies. Price-fixing that had left the public and councils to “pick up the tab”.
In Utility Week News, barrister Roger Barnard, former head of regulatory law at EDF Energy, wondered whether any government is able to safeguard the nation’s energy security interests against the potential for political intervention under a commercial guise, whether by Gazprom, OPEC, or a sovereign wealth fund. He added: “Despite what the regulators say, ownership matters”. The Office of Fair Trading was closed before it could update its little publicised 2010 report which recorded that 40% of infrastructure assets in the energy, water, transport, and communication sectors were already owned by foreign investors.
A Lancashire farmer believes that supermarkets – powerful lobbyists and valued party funders – are driving out production of staple British food supplies and compromising our food security. She sees big business seeking to make a fortune from feeding the wealthy in distant foreign countries where the poor and the environment are both exploited. These ‘greedy giants’ are exploiting the poor across the world and putting at risk the livelihoods of hard working British farmers, their families and their communities. She adds that large businesses are gradually asset-stripping everything of value from our communities to make profits which are then invested abroad in places like China and Thailand.
Government resistance to funding long-term out of work illness/disability benefits followed the publication of a monograph by the authors funded by America’s ‘corporate giant’ Unum Provident Insurance which influenced the policy of successive governments. After various freedom of information requests, the DWP published the mortality figures of the claimants who had died in 11 months in 2011 whilst claiming Employment and Support Allowance, with 10,600 people dying in total and 1300 people dying after being removed from the guaranteed monthly benefit, placed into the work related activity group regardless of diagnosis, forced to prepare for work and then died trying. Following the public outrage once the figures were published, the DWP have consistently refused to publish updated death totals. Information touched on in this 2015 article has been incorporated into a ResearchGate report identifying the influence of Unum Provident over successive UK governments since 1992, the influence of a former government Chief Medical Officer and the use of the Work Capability Assessments conducted by the private sector – described as state crime by proxy, justified as welfare reform.
The powerful transport lobby prevents or delays action to address air pollutants such as ground-level ozone and particulates emitted by cars, lorries and rail engines which contribute directly to global warming, linked to climate change. They emit some common air pollutants that have serious effects on human health and the environment. Children in areas exposed to air pollutants commonly suffer from pneumonia and asthma.
Victimised whistleblowers, media collusion, rewards for failure and the revolving door
- A recent whistleblower report records that Dr Raj Mattu is one of very few to be vindicated and compensated after years of suffering. The government does not implement its own allegedly strengthened whistleblower legislation to protect those who make ‘disclosures in the public interest’.
- This media article relates to the mis-reporting of the Obama-Corbyn meeting: there are 57 others on this site.
- Rewards for failure cover individual cases, most recently Lin Homer, and corporate instances: Serco and G4S were bidding for a MoD £400m 10-year deal, though they had been referred to the Serious Fraud Office for overcharging the government on electronic monitoring contracts. Another contender, Capita, according to a leaked report by research company Gartner was two years behind schedule with its MoD online recruitment computer system – yet the government had contracted to pay the company £1bn over 10 years to hire 9,000 soldiers a year for the army.
- The 74th instance of the revolving door related to Andrew Lansley’s move from his position as government health minister to the private health sector. An investigation by the Mail found that one in three civil servants who took up lucrative private sector jobs was working in the Ministry of Defence: Last year 394 civil servants applied to sell their skills to the highest bidder – and 130 were MoD personnel. Paul Gosling describes how the Big Four accountancy firms have PFI ‘under their thumbs’ and gives a detailed list of those passing from government to the accountancy industry and vice versa.
Steve Beauchampé asks if the barrage of criticism apparently aimed at Jeremy Corbyn is more about undermining the politics he stands for which are probably less far to the left than those of many in the current government are to the right. Most political commentators and opponents aren’t worried that Labour will win a General Election under him, but they are alarmed that the movement his leadership has created might one day lead to an electable left winger.