For several years now I have been calling on the Government to pause and fix the Universal Credit system before it is rolled out across the entire country.
Universal Credit is full of flaws that have been repeatedly highlighted by its recipients, charities, research institutions, and MPs. However, the Government has consistently ignored these flaws or said that it is someone else’s job to address them.
One such flaw, highlighted by the Child Poverty Action Group (CPAG), would result in irregular payments for claimants, making it hard for them to budget, and lowering payments overall.
It occurs when the Universal Credit monthly assessment period (e.g. 14th of one month to 13th of the next month) is close to someone’s pay day. When this happens, two monthly pay cheques can fall in the same assessment period in some months, whilst in others there is no pay cheque. I have posted a document below to highlight what effect this could have on the amount claimants receive from Universal Credit.
I wrote to the Secretary of State for Work and Pensions, Esther McVey, and asked her to remove this defect from the Universal Credit system. I later received a reply from Alok Sharma, the Minister of State for Employment, and I have posted a copy of this letter below.
In his letter, the Minister has shirked responsibility and said that it is up to employers to ensure that Universal Credit recipients are not detrimentally affected by the defect. Also, if employees are losing out because of the defect, then they have to raise it with their employer, not with the Government. I believe that this is a dereliction of duty on the part of the Government and an obvious disregard for the welfare of recipients.
However, the flaws in the system are not the only problem with Universal Credit. Simultaneously, there are severe cuts being made to social security funding, which are only adding to the suffering of Universal Credit recipients and others who rely on social security.
At the Autumn Budget, the Chancellor announced there would be £1.7bn in additional spending on Universal Credit. He said that work allowances would be increased by £1,000 from April 2019 and announced an extra £1bn over five years to provide extra protection for people on tax credits and other benefits who move over to Universal Credit.
However, Institute for Fiscal Studies (IFS) analysis calculated that there were still £7bn worth of social security cuts to come by 2022-23. This means that £5bn of cuts are still to come, despite the additional £1.7bn that has already been announced.
These concerns over funding for social security were raised by my opposition colleagues when the Finance Bill was debated, and we voted against the Second Reading of the Finance Bill. However, the Government’s majority held, and the Finance Bill was passed.
Before this, on 17 October, the opposition had proposed a motion that called for the rollout of Universal Credit to be paused, so that the system could be reformed before it was implemented across the country. However, the Conservative and DUP MPs in attendance all voted against the motion, and so it was defeated.
My opposition colleagues and I have been consistently highlighting the flaws in the Universal Credit system, and the detrimental effect that cutting social security funding will have on recipients, for several years now. However, the Government refuses to listen, and Conservative and DUP MPs continue to vote in favour of implementing the deeply flawed Universal Credit system and cutting funding for social security.
I can assure you that my opposition colleagues and I will continue to raise our concerns over Universal Credit with the Government and oppose its introduction, but we are highly unlikely to succeed until there is a change of Government.