What’s still wrong with Universal Credit?

What was the problem?

We were concerned that many of our clients were suffering considerable hardship through flaws in the operation of Universal Credit (UC).

What have we done to help?

In November 2019 we decided to follow up a sample of our clients who had received assistance from Help to Claim to apply for UC or had asked for help with existing claims between April and the end of June 2019. Our aim was first to find out how they had managed on UC since then and next to identify, and illustrate with case studies from their experience, key issues with the operation of UC that need urgent improvement. To achieve this, we analysed the case records of about 60 clients and followed this up with telephone interviews with 15 of them to bring this information up to date. As our research progressed, we also looked out for evidence of the same issues in more recent cases.

We summarised our findings in a report you can view here. Our report was very well received by national Citizens Advice, who said there was very useful information in the report which they will use in national campaigning to improve claimants’ experience of UC.

We came to the following conclusions and recommendations on each of the issues we explored in our research.

The Living Cost Gap

Despite the increase in some UC payments from April 2020 the benefit still does not provide a basic level of financial security for some clients.

We recommend that:

  • the threshold for the Benefit Cap be raised substantially and the imposition of a cap be re-examined with a view to its abolition
  • Local Housing Allowance (LHA) rates for the housing element of UC be reviewed before April 2021 to investigate whether restoration to the 30th percentile of market rents provides adequate support for private tenants’ housing costs
  • LHA rates for one-bedroom flats and houses be made available for the housing costs of UC claimants from the age of 25
  • Compulsory deductions from UC payments be confined to earnings, advance payments, and sanctions. Otherwise payment of all debts should be left for UC claimants to negotiate independently with their creditors
  • Advance payments include a non-repayable grant to help claimants meet landlords’ requirement to pay each month’s rent in advance and the amount to be repaid be capped at an affordable level within 12 months
  • The child element of UC and the upper limit for support for child care costs be increased immediately to meet higher costs and the level of all UC payments be re-examined with a view to further increases from April 2021 in line with the formula proposed in the Citizens Advice report on Making Ends Meet.

Help For Claimants To Deal With Their Debts

Some claimants have heavy financial commitments including debts which will be difficult for them to meet on a UC budget. We recommend that to prevent these claimants falling further into debt  they should be strongly encouraged to review their budgeting and repayment plans at the start of their claims and if they need help, should be offered a free appointment with a debt advice agency.

Poor Administration – Improving the process for closing and re-opening UC claims

We recommend that UC claims should not be closed until

  • Claimants have been warned both on their online Journals and by direct contact by Jobcentre staff with reasons for the closure and
  • Allowed two weeks from the date of the warning to challenge the reasons for the closure

UC Journals should remain accessible to claimants for at least two weeks after the date of closure to allow claimants to review the information available on the Journal and if appropriate request mandatory reconsideration (MR).

The software for the Journal should be adjusted to allow for the same UC account to be re-opened without new login details where a claim has been wrongly closed.

Improving the DWP’s Right to Reside assessments for UC

Priority should be given to training DWP staff who take decisions on Right to Reside requirements for eligibility for UC to investigate thoroughly all the relevant evidence and establish effective links with colleagues in HMRC and the Home Office

Improving the treatment of disabled UC claimants

We believe that the whole culture of UC health assessments and DWP work capability decisions needs to be transformed before disabled UC claimants can be treated fairly. To help achieve this transformation we recommend that:

  • where health professionals and DWP decision makers consider that claimants are fit for work they should be required to explain what type of work they think that the claimants could do and what support they may require
  • where health professionals and DWP decision makers consider that claimants are capable of work-related activities they should be required to explain what type of activities they should be able to undertake and what support they may require to do them. Failure to provide this information should result in an automatic award of limited capability for work related activities on appeal
  • some work coaches in every JobcentrePlus office should receive additional disability-specific training and to be required to provide ongoing practical support to disabled claimants found fit for work or for work related activities
  • decisions on MR requests should normally be reached within a month of the requests and
  •  as more tribunal staff are appointed the waiting time for tribunal hearings on appeal should be reduced progressively to 3 months and
  •  tribunals should insist on DWP complying with the requirement in the tribunal regulations to provide all the evidence required for the hearing within 28 days of receiving notice of the appeal

The Help Available For Claimants Who Cannot Use The Internet

We recommend that the special support available to claimants who cannot use the internet to make their claims should be continued once their claims have been accepted either

  • by providing additional Jobcentre Plus staff trained to monitor their accounts each month and keep in close contact with the claimants by phone to explain any changes or
  •  by funding an extension of Citizens Advice’s Help to Claim service to continue supporting these claimants beyond the completion of their initial claims.

The Information/Assistance Available From Work Coaches/DWP

Several clients whom we interviewed complained that they could not get the information or help that they needed to improve their experience of UC and considered that they were ill informed. We recognise that with the massive increase in UC claims because of the Covid-19 lockdown the DWP’s first priority will be to recruit new staff to cope with the demand. Nevertheless, we recommend:

  • reinforcing work coaches’ basic training in the processes for claiming and paying UC with links to the information already available online on more detailed issues (e.g. through www.gov.uk) so that they are equipped to refer claimants to this information  and
  • expanding the information provided in UC Journals to include prominent links to information available online about different topics covered in UC rules and regulations.
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