The Chancellor can ‘level up’ Britain with changes to Universal Credit
Every day I speak to constituents who are struggling under Universal Credit.
Whether it is the five-week wait, the fact that childcare is paid in arrears, the rigid assessment periods, the miserly taper rate, or work allowances which mean for many it is far less generous than legacy support, people are really struggling.
Then there are Universal Credit’s deductions for loans or other upfront costs, the lack of transitional protections, and a selfemployed minimum income floor.
However, as chairwoman of the All
Party Parliamentary Group on Universal Credit I have committed to working with politicians across the spectrum to improve it through collaboration and compromise.
Which is why I think it is so important the new Chancellor, Rishi Sunak, shows us that he really understands the people’s priorities and works to improve Universal Credit at this Budget.
Following years of the benefit freeze, changes to Universal Credit, including reductions in the Work Allowance, the scrapping of disability premiums and the freeze to the Local Housing Allowance rates, means our social security system is no longer the safety net it needs to be for people on the lowest incomes.
This is particularly the case for people of working age who have had approximately £37billion of reductions in support since 2010. Working age disabled people have been the most detrimentally affected of all groups, losing on average over £1,000 a year as a result of the changes. Firstly, the Government must scrap the five-week wait. National charities, including Turn2us have produced reams of evidence that the wait is pushing people into debt. Advances are not a solution, they are merely a loan. Secondly, the dual impact of the benefit freeze with the 30% cap on Local Housing Allowance, together with rents rising faster than inflation, has meant the value of LHA has fallen even faster than other social security support. In some areas of the country it now covers just 3% of rents. This means that many UC claimants are at risk of homelessness.
The Government must fix this urgently by increasing the adequacy of social security support – increase working age benefits affected by the freeze by 2% over and above the Consumer
Price Index for the next four years as was recommended by Citizen’s Advice.
Thirdly, there must be a permanent solution to protect disabled people through Severe Disability Premiums on Universal Credit.
The Department for Work and Pensions must ensure that the disability elements are at least equivalent to those which applied on legacy benefits.
Other recommendations made by the All Party Parliamentary Group on Universal Credit should also be considered, including those which enable financial independence for women. The current system where one payment is made per household to the main earner is a threat to women.
Universal Credit has led to a 7% rise in psychological distress among recipients since it came in. There is also a predicted increase in child poverty, inequality and lower life expectancy.
There are concerns, highlighted in coroners’ reports, that DWP policies are leading to premature deaths. A staggering 14 million people are already in poverty, and most of them live in working households.
Rishi, if you are able to make the changes set out above, this could make a real difference and demonstrate the Government’s commitment to ‘levelling up’.
But doing nothing is unthinkable.
■ Debbie is Labour
MP for Oldham East and Saddleworth
A staggering 14 million people already live in poverty in the UK