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In the Times and the FT a question: is universal credit – to date – a disaster?

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?

Richard Smerdon summarises in the FT:

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.

Citizens Advice is being flooded with clients. It reports evictions and women losing their jobs because childcare payments are so delayed that they lose their childcare place.

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 . . .”

 

 

 

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Focus on cuts – 5: the poorest targetted

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.

 

 

 

 

Black Monday: how can government sentence the poor and disabled to increased hardship?

How can MPs earning more than double the national average – plus allowances, directorships and expenses – find it in their heart to vote to sentence the poor and disabled (without influence) to increased hardship?

The relatively prosperous look on aghast as support for those who have least is cut but the prosperous are voted tax breaks and other concessions. How far will this government be allowed to go?

It is no coincidence that around the country groups are gathering to promote showings of the latest Ken Loach film and citing his Question Time video clip:  

ken-loach

A Bournville reader points out that “the tragedy is that (the long-term homeless) are going to be joined by many more who have had a home. See what is going to come into play with effect from Monday 7th November” and sends a link to an article about a cut in housing benefit from Nov 7th.

He asks: “Where are all these extra homeless people and families to go? And at what cost?” 

Tomorrow more than 100,000 households will be materially worse off. Some households will lose as much as £115 a week.

The idea of tightening their belt and reducing household spending assumes that energy and food are expendable luxuries.

tighten-belt-cropThose hit by the cap will soon be in arrears. Either their landlord, social or private, absorbs the cost of the arrears, or – more likely – the tenant is evicted.

In the Guardian, Aditya Chakrabortty stresses the costs of the lost income, the long-term psychological harm to tenants, the deteriorating health of households in temporary accommodation and the exorbitant cost of temporary accommodation for those evicted.

Every day in England and Wales, 170 tenants are evicted.

homeless-textEvictions have increased by 53% in the past five years. Around 80% of these are carried out by social landlords, and a further 20% by private landlords.

The new reduced benefit cap: how it works and who it affects – the facts and figures – are given here and in the BBC programme, right.

Those who are being swayed by the PM’s rhetoric should look at her previous actions in office as Minister for Women and Equality, when her edicts downgraded the provision for carers, children in need and vulnerable people. She:

  • suspended the registration scheme for carers of children and vulnerable people.
  • scrapped the former Labour Government’s proposed “go orders” scheme to protect women from domestic violence by banning abusers from the victim’s home.
  • closed the previous Government’s “ContactPoint” database of 11 million under-18-year olds designed to protect children in the wake of the Victoria Climbié child abuse scandal and
  • removed a clause from the Equality Act which would have required public bodies to consider how they can reduce socio-economic inequalities when making decisions about spending and services.

Welfare payments are designed to act as a safety net to stop people in the fifth-richest economy in the world being hungry or homeless.

Where will the cuts inflicted on the poorest end, and wherever is Ms May’s compassionate conservatism in action?