WIREDGOV

Citizens Advice today reiterated its call for the roll-out of Universal Credit to be paused and problems with the benefits fixed as new figures from the Department for Work and Pensions (DWP) show 1 in 5 people applying for Universal Credit are waiting longer than six weeks for their first payment.

Further DWP research , also published, shows people on the new benefit are falling into rent arrears, with over 2 in 5 saying this was due to problems with the benefit.

In August the equivalent of 12% of people applying for Universal Credit turned to Citizens Advice for support.

Chief Executive of Citizens Advice Gillian Guy said:

“These figures confirm Citizens Advice research showing that Universal Credit risks pushing people further into serious debt.

“The DWP’s own evidence shows more than 1 in 5 people applying for Universal Credit are waiting over six weeks for their first payment, and that many people say they are falling behind on their rent as a result.

“It is clearer than ever that the government must pause the roll-out of Universal Credit and fix the problems with this benefit.”

In a report published last week, Citizens Advice analysed over 50,000 cases where it has helped people with their debt problems and found that for those on Universal Credit:

• 79% have priority debts such a rent or council tax, putting them at greater risk of eviction, visits from bailiffs, being cut off from energy supplies and even prison - compared to (69%) on legacy benefits such as Jobseekers Allowance or Housing Benefit.  

• 2 in 5 (41%) have no money available to pay creditors as their monthly spend on essential living costs is more than their income.

• Typically people on Universal Credit only have around £3 a month left to pay creditors.

It is urging the government to ensure no one applying for Universal Credit waits longer than 6 weeks for an income, and that anyone who needs it gets a payment within 2 weeks that they do not need to repay.

Universal Credit fact sheet

Universal Credit was introduced in 2013, aiming to simplify the benefits system, to make transitions into work easier, and make every hour of work pay. It’s there for people on low incomes or not in work to help them meet their living costs.

Universal Credit is for people both in work and out of work, disabled people and those with a health condition, single people and those with families, people who own their homes and people who rent.

It replaces six means-tested benefits and tax credits with one benefit. This is paid in arrears, as a single household payment, on a monthly basis.

It is designed to use Real Time Information from HMRC to respond to changes in income, gradually reducing the UC payment as earnings increase to ensure work pays. The six benefits it replaces are:

• Income-based Jobseeker's Allowance (JSA)

• Income-based Employment Support Allowance (ESA)

• Housing benefit (HB)

• Income Support (IS)

• Child Tax Credits (CTC)

• Working Tax Credits (WTC)

Universal Credit is being rolled out gradually across the country, one job centre at a time. Everywhere in the country either operates a “live service” or “full service”.

Live service areas are places where a limited version of Universal Credit is in place only for certain people (eg single adults not in work), so as to test the system on  on those with simpler claims.  ‘Full’ service has been developed to upgrade and build on the first, ‘live’ system.  

From May 2016, full service Universal Credit began to be introduced across the country, in a small number of local authorities initially, which meant all new claimants of the six different benefits being replaced are required to apply for UC.

Live service roll-out is now complete, but full service roll-out is ongoing and due to accelerate significantly from October 2017. All areas will eventually become full service by 2022.

There are currently 533,000 people on Universal Credit in England and Wales, with around 50,000 new claims each month (ONS).

Notes to editors

1. The Citizens Advice service comprises a network of local Citizens Advice, all of which are independent charities, the Citizens Advice consumer service and national charity Citizens Advice. Together we help people resolve their money, legal and other problems by providing information and advice and by influencing policymakers. For more see the Citizens Advice website.
2. The advice provided by the Citizens Advice service is free, independent, confidential and impartial, and available to everyone regardless of race, gender, disability, sexual orientation, religion, age or nationality.
3. To get advice online or find your local Citizens Advice in England and Wales, visit citizensadvice.org.uk
4. You can get consumer advice from the Citizens Advice consumer service on 03454 04 05 06 or 03454 04 05 05 for Welsh language speakers.
5. Local Citizens Advice in England and Wales advised 2.5 million clients on 6.2 million problems in 2014/15. For full service statistics see our publication Advice trends.
6. Citizens Advice service staff are supported by more than 21,000 trained volunteers, working at over 2,500 service outlets across England and Wales.