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The Chartered Institute of Housing is the independent voice for housing and the home of professional standards

Universal credit tweaks are welcome - but they don't go far enough

19/10/2017


Making the universal credit helpline free and offering advance payments isn't enough to make universal credit work for claimants, says CIH policy and practice officer Priya Thethi - but there are three changes which would help.

Yesterday, we saw the problems with universal credit reach the very highest levels of government. We also saw that ministers are listening. 

Firstly is the enormously welcome announcement that calls made to the universal credit helpline will now be free. With evidence suggesting that 30 per cent of Citizens Advice clients needed to make 10 or more calls to resolve their claim, the previous charge of up to 55p per minute was an unsustainable and unfair requirement, imposed on people with little other choice.

We also welcome refreshed guidance around advance payments. Making sure that they are proactively offered to people in need can help to ensure that people facing the worst hardship will have access to some form of financial support during the long wait for universal credit.

However, these changes simply don't go far enough - they still fall short of addressing the range of issues which social landlords are reporting to us.

Advance payments, while providing short-term relief, are in effect loans, and loans must be repaid. Landlords report that the deductions from their tenants’ future universal credit payments are simply too high, pushing them into financial hardship.

We also question the expectation that advance payments, which comprise 50 per cent of a claimants’ total universal credit award, will be sufficient to tide claimants over for a five or six week wait. It’s especially worrying when many claimants – up to 19 per cent – have to wait longer for their first payment because of delays and errors. It’s concerning most of all that the welfare minister indicated last night that abolishing the seven day waiting period is indeed a possibility – it just isn’t a priority.

Finally, it’s worth pointing out that a loan, while useful, can only be some of the support needed. Universal credit represents an enormous change in the welfare system, particularly with the shift to online administration and single, monthly payments, and 'universal support delivered locally' – the support services provided by government for universal credit claimants – simply is not available as consistently, or indeed universally, as needed.

In short, advance payments are not a panacea, and they should not be treated as such. While we’re disappointed that the government chose to abstain from last night’s symbolic vote, it’s not too late for them to take significant, positive steps towards improving a system which actually has a lot of potential. There are three things that could make a big difference:

  • Accelerate the rollout of the landlord portal, so that more social landlords can benefit from the improved payment timeliness which it brings.
  • Abolish the seven day waiting period, to reduce both claimants’ hardship and unsustainable levels of personal debt.
  • Slow down the universal credit roll-out, so that the improvements being made to the system have time to embed and the Department for Work and Pensions can continue its test and learn approach.

Yesterday, the government showed that it is willing to listen. Ministers must continue to listen to what claimants and landlords are telling them - and to act where necessary - so that the legacy of universal credit is not homelessness and hardship.

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