Universal Credit causing 'hardship and struggle' for people on Merseyside

The new service, which has been widely condemned, aims to help claimants and their families become more independent and simplify the system by bringing together a range of benefits into a single payment.

But it's been the subject of huge controversy, with delays in claimants receiving money well documented since it was introduced and gradually rolled out by the Department for Work and Pensions (DWP) in 2016.

In June, Money Saving Expert revealed a fifth of claimants are still receiving their first payment late, also finding that as well as the mandatory five-week waiting period before getting the first payment, they often had to wait another four weeks on top of that.

MSE also estimated around 300,000 claims will be paid late this year unless the six-in-one system improves.

With UC set to be fully launched across Liverpool this month, Walton MP Dan Carden claimed evictions in the city will be "inevitable", and revealed some letting agents in his local area have threatened to stop allowing people on the new benefit to move into their properties.

Liverpool is one of the last locations in the North West for the roll-out, with most of Merseyside – Sefton, Wirral and Knowsley – already moved over.

This week, a report published by Wirral Council's business overview and scrutiny committee has shown the extent of hardship and struggle UC is already causing to people in the borough.

It included the various ways it is affecting different groups of people, as well as confusion over the new system and the impact on food banks and free school meals.

The information in the report came from workshops held earlier this year between councillors, council officers and representatives from various organisations providing services to those affected by UC.

These 12 facts from the report show the hardship and struggle Universal Credit is already causing people on Merseyside:

1. There are rising numbers of people who need help with their claims

It said those mainly affected were customers who presented a "wide range of complex and diverse needs" when making a claim.

It found in January this year, there was a "significant increase" in the number of people coming to Citizens Advice Wirral for support.

In September last year, before November's full service roll-out, just 33 attended the service to raise concerns, while in January, that number soared to a reported 141. It is expected, the report added, that the upward trend will increase over the coming months.

Speaking about how it has impacted vulnerable people, the report added: "It was further highlighted that Universal Credit is a complex benefit to understand and these vulnerable claimants who may have a learning disability, or not have the mental capacity, find it harder to go through the required

process.

"Other claimants may not have internet access or the skills needed to apply or manage online claims."

They included people suffering from drug and alcohol abuse.

2. It's affecting people in all sorts of ways

The report said the impact seen by Citizens Advice Wirral meant an increase in financial hardship – food poverty, fuel poverty and increased debts, deterioration of health through increased anxiety, stress and mental health and well-being.

It said a "typical" example of a vulnerable client supported by the service was a single woman with a learning disability, receiving disability living allowance with low rate mobility. The woman had no email address, and was in rent arrears – facing eviction as she had not claimed housing benefit since January 2016.

She had "limited understanding" of what claimants had to do to get their payments, and did not understand the housing elements of UC.

3. The 'digital challenge'

While one of the aims of UC was to improve the efficiency of the process, the roll-out requires claimants to be able to log and manage claims online with an account created using an email address.

During the workshops, members heard people suffering from "digital exclusion" are generally disadvantaged lower-income groups, older people and those with disabilities or learning difficulties.

4. The effect on the homeless

As many have no access to a computer, a lot of homeless people – particularly the elderly – are likely to experience “anxiety and confusion” over the new system, the report said.

You also need proof of ID needed to claim, meaning various potential difficulties for the homeless when applying for UC.

5. The effect on people with disabilities

Claimants with disabilities would see a reduction in benefits of £69, the report said.

That’s because under UC, disability premiums cease to exist, with the money now provided through personal independence payments.

6. The waiting period for the first payment

Residents were given a choice between managing expenditure through the initial waiting period before first payment, or taking an advance payment but then having reduced future payments.

According to feedback from the Feeding Birkenhead network, that caused hardship even if only a small percentage was taken from those future payments. There have also been some instances where people have been exploited by loan sharks and doorstop lenders, which "may trigger a spiral of chronic debt".

There has been a new personal budgeting support service laid on by the council, but take up of it was "low" and better promotion "would be required moving forward".

7. Fluctuations in payments

Another issue affecting people in Wirral has been that as the previous month’s income is used as the basis to determine the next award, any changes in earnings will result in fluctuations to UC payments.

It was reported that people doing variable shift work, on zero hour contracts or self-employed were experiencing financial difficulty because of it.

8. Sanctions

UC rules mean more people are being sanctioned – when benefits are cut or reduced due to reasons like failing to attend work or interviews – than under the previous system.

The Feeding Birkenhead Network said sanctions were one of the biggest issues regarding UC, and spoke about a client with severe disabilities who had an epileptic fit on the way to a Jobcentre appointment. They were taken to hospital after collapsing, but then sanctioned for 106 weeks for failing to turn up to the appointment.

9. Free school meals

From 2013, children in all families moving to UC have been eligible for free school means, but a new government income threshold from April this year means there could be an increase in the number of children living in poverty in Wirral.

With the new UC system, claimants generally have to wait five to six weeks before they are entitled to free school meals, but Wirral council then made a decision to give them out "where there was evidence that a claim had been made".

While there was an intention for this to continue, the council is still waiting for clarification on this.

10. Confusion over council tax support

Council tax support is NOT included as part of UC, with claimants responsible for applying for it locally themselves. But the report said there is some confusion over that, and further campaigns will be launched by the DWP and council to clear that up.

11. The impact on food banks

Nationally, in areas where full UC service has been rolled out for six months or more, there is a 30% average increase in demand at food banks compared to the previous year.

While the report said the full impact is yet to be seen at Wirral's food banks, we spoke to the borough's food bank manager last month, who said demand has risen by a third.

Between January and April this year, the food bank, which runs 15 centres across the borough, handed out nearly 50,000 three-day emergency food supplies to people in crisis.

12. The added workload for council staff

The report finished by summarising how the council has seen increased work volumes thanks to the UC roll-out, with the number of claims rising from 1,728 in 2014 to 5,511 last year.

The impact has also been felt at One Stop Shops, with centres taking more phone and email enquiries, and the length of interviews also increasing.

Those at the workshops were "cautious" on whether the services and support could be maintained at these levels.

A spokeswoman for the Department for Work and Pensions said: "Universal Credit simplifies an out-of-date, complex system with evidence showing that under UC claimants are getting into work faster and staying in work longer.

"Our research shows that many people join Universal Credit with pre-existing arrears, but the proportion of people with arrears falls by a third after four months in UC.

"The majority of claimants are comfortable managing their money but we are increasing support to help people who need it to stay on top of their payments. Up to 100% benefit advances and direct rent payments to landlords can be provided.

"We also recently removed the seven-day waiting period from new claims and continue to pay people's Housing Benefit for two weeks while they wait for their first full Universal Credit payment."