Universal Credit chaos

The devastating economic toll the coronavirus crisis has taken was thrown into sharp relief when it emerged this week that nearly a million people have signed on to Universal Credit.

 

About 950,000 people applied for the state benefit – the primary support for people who have lost their jobs or had their earnings reduced – in the last two weeks. This is ten times more than the average of 100,000 applications in a typical two-week period.

 

The unprecedented surge in Universal Credit applications has shown that even with new government schemes meant to cover 80 per cent of both employees’ and self-employed people’s earnings amid the UK-wide lockdown, far too many are still falling through the cracks.

 

“We have never seen anything like this,” said Resolution Foundation director Torsten Bell. “It is not remotely normal even in the grim circumstances of a recession. While attention has understandably focused on new retention and self-employment schemes, universal credit delivering in the face of this huge jobs shock is the key to many families avoiding real hardship.”

 

The Resolution Foundation think tank which carries out research on living standards, said that the government must make the Universal Credit system ‘battle ready’ to ensure that it truly supports the many millions who will not be eligible for support from other schemes.

 

The think tank has said that the government must work quickly to extend Universal Credit eligibility, speed up payments and encourage more people to claim.

 

After the government announced a package of support for self-employed people in March, hopes for these workers were dashed after being told they must wait until June to get any help – in the meantime they were advised to claim Universal Credit.

 

But as Unite rep and black cab driver Jim Kelly explained, the requirements will render far too many ineligible.

 

“Universal Credit eligibility is quite draconian,” he told UniteLive last week. “I strongly believe the government devised it to ensure that the majority of people won’t be able to claim it. If you have a certain amount or more in savings, you don’t qualify; if you partner is working again you don’t qualify.”

 

Unite has highlighted the many holes in the Universal Credit system which must be fixed with urgency if the benefit is to help those who desperately need it.

 

While the government has said it has moved 10,000 existing DWP staff to the frontline to help with claims and intends to recruit more staff, interminably long online queues are being reported, as are hours-long waits on the phone.

 

Unite has noted that many of the lowest-income households do not have access to the internet at home amid the lockdown so there must be a sharp increase in DWP staff to staff phone lines.

 

The union has also outlined action that can be taken now to fix Universal Credit holes, including ending the notorious five-week wait for the first Universal Credit payment.

 

The wait period has long been criticised by Unite which the union has said is a totally unnecessary feature of the system that has caused untold hardship and plunged people into debt.

 

“The government has said that people can take out emergency advance payments to cover the five-week wait period but these are loans and must be paid back,” explained Unite Community co-ordinator Liane Groves. “It therefore plunges people into poverty from day one. People don’t have savings so it’s brutal. Rent arrears immediately stack up.”

 

Another obstacle that is preventing many from claiming Universal Credit is a strict identification process that requires three different forms of ID.

 

“This has caused huge problems for people who don’t have, for example, passports or drivers’ licences – which low-paid workers often don’t,” Groves noted.

 

Above all, Universal Credit, at about £400 a month, is simply not enough to live on.

 

“Universal Credit payments are well below even the most austere subsistence levels,” Groves said. “It is nowhere near enough to feed your family or heat your home.”

 

“The government has taken out £36b a year from the welfare budget since austerity. Now working people will realise that the benefit system is a safety net with enormous holes. It was hollowed out by the political choices the Tories made.”

 

While Unite continues to press the government make immediate changes to the Universal Credit, the union is also working to help its members navigate the system as it exists now.

 

If members need advice on a COVID-19 related benefits query, information is available from the DWP online here and Unite have set up a dedicated benefits advice line which members can access by calling 0333 202 6563

 

Please note that phones may be busy, but we will do everything we can to respond to all member enquiries as quickly as possible.