Universal Credit

UC

A number of constituents have written to me about the roll-out Universal Credit. I am supplying the following information (which I wrote in order to explain to others how the new benefit works) and a specific example of the day I spent with my local team so that constituents have more detail. 

I should add that I went to an MPs workshop on how Universal Credit works and how MPs can help constituents. 

Description of Universal Credit:

UC delivers simplicity by merging six benefits, to one.

In-work and out-of-work benefits of Job Seekers Allowance, Tax Credits, Housing Benefit, Income Support, Child Tax Credits and Employment Support Allowance will be replaced by Universal Credit.

UC responds to a customer's monthly earnings, broken down as follows:

It usually takes around 5 weeks to get your first payment.

If you need help with your living costs while you wait for your first payment, you can apply for an advance.  The advance now allows customers to take up to 100% of their expected first payment. This is to be repaid over a period of up to 12 months, to aid customers through their transition

The wait before your first payment is made up of a one month assessment period and up to 7 days for the payment to reach your account.

UC prepares people for work:

  •  paid monthly (like three quarters of jobs are); and
  •  paid to individual, not the landlord (like wages are).

UC helps people in to work:

  • no risk from coming off benefits;
  • always know you will be better off working; and
  • 3 separate studies show UC gets you into work quicker than JSA.

UC helps people get on in work:

  • payment based on earnings not hours;
  • no hours rules, and no restrictions on your progression; and
  • up to 85% childcare reimbursed (up to a monthly maximum of £646.35 for one child or £1,108 for two/more children)

UC Learns Lessons of the past

  • Tax Credit 'big bang' implementation in 2003 vs UC 9 year gradual roll-out; between Oct 17 and Jan 18, we will go from UC covering to 8% of claimant population, to 10%;
  • Tax Credit implementation in 2003 overloaded call volume and casework vs UC agile IT development and recalibration;
  • Tax Credit 2003 caused massive under-payments and over-payments; and many people had to wait far longer than under Universal Credit to get paid anything

Continuous improvement

  • half of people now get a new claim or benefit transfer advance (up to 50% of the payment can be advanced upfront if people struggle in the first 6 weeks).
  • landlord portal improves process for housing associations and councils. Trusted partner status for these landlords means they can directly identify who should be on direct rent payments. Both rolling out now.
  • improving processes like uploads and online reporting of self-employed earnings
  • timeliness of payment has improved markedly
  • there are options in place for more vulnerable customers -these include managed payments to landlord and alternative payment arrangements.

UC and COVID-19

At Budget, the Chancellor announced that on top of the planned uprating, the Government is extending the temporary £20 per week increase to the Universal Credit standard allowance until the end of September 2021. This measure will apply to all new and existing UC claimants. 

 

Further information about my visit to the JobCentre to learn more about Universal Credit is at the following page on my website:

https://www.huwmerriman.org.uk/news/universal-credit-bexhill-and-battle-constituency-my-experience