Mayor calls on government to halt Universal Credit rollout

• Sadiq deeply concerned about the effect of Universal Credit on Londoners in most need of support
• Rollout has been blighted by technical issues, implementation errors and funding cuts
• Mayor calls for scheme to be paused until serious issues are fixed

The Mayor of London, Sadiq Khan, has called on the government to immediately pause its rollout of Universal Credit for the good of Londoners in most need of support.

The Mayor is deeply concerned that the continued rollout of the government’s new welfare system will result in Londoners losing access to vital funds, after very troubling early results in London. 

Funding cuts to Universal Credit are also forecast to result in a £250m decrease for claimants in London per year by 2020/21, and the impact is already being felt in the capital.

More than 135,000 Londoners are claiming the new benefit, but cuts to funding, IT problems, late payments and a lack of support in navigating the complex claim process has seen significant hardship for many Londoners, pushing some to the brink of homelessness.

Figures from Tower Hamlets Council show that 80 per cent of its council tenants who were claiming Universal Credit were behind on their rent in April this year. This compared to 35 per cent of housing benefit claimants, and the average arrears of those on universal credit was more than seven times higher than those on housing benefit.

Croydon, Hounslow, Southwark and Tower Hamlets councils revealed that last year rent arrears across the boroughs had reached £8m since the scheme was rolled out, leaving more than 2,500 tenants at risk of eviction.

Next year the government is due to start moving more than two million people nationally from six benefits schemes to the new system, including more than 750,000 sick or disabled claimants.

Many of those with the most severe disabilities and long-term health conditions, including up to 122,000 in London, may need more intensive support and that’s why the Mayor is calling for this to be put on hold until the serious issues with the system are resolved.

The Mayor of London, Sadiq Khan said: “We all want a simpler, fairer benefits system that improves the incentive for people to work, but Universal Credit, in its current form, falls well short of that.

“The benefits system has to be supportive and flexible enough to deal with complexity of people’s lives, but we have already seen the shortcomings of the new system causing significant hardship to Londoners most in need of support.

“If the government does not change tack, the chaotic implementation of this system risks causing considerable disruption to the lives of thousands of Londoners.

“I urge the government to pause its rollout of Universal Credit until it is fit for purpose and encourage ministers to acknowledge the yawning gap between the way the scheme is supposed to work and the harsh realities experienced by those claiming it.”

Alison Garnham, Chief Executive of Child Poverty Action Group, said: “Evidence from our Early Warning System shows universal credit is bringing financial misery to thousands of families in London and elsewhere. The DWP’s own survey found eight to nine months into their claim 40 per cent of claimants were falling behind with bills or credit commitments or experiencing real financial difficulty. The most vulnerable claimants struggle to even get a claim off the ground, often because of lack of digital access or literacy,  illness and disability.  What we are seeing is not teething trouble in universal credit but fundamental design and funding problems.  

“In time half the country’s children will be in a household claiming universal credit so we have to get this right. Now is the time to pause the roll out, re-visit its design and restore the funding that’s been taken out of universal credit. If that doesn’t happen, the policy will roll-out  more misery to hard-pressed Londoners and its capacity to make work pay will be undermined.”

Tracey Lazard, CEO of Inclusion London, said: “Inclusion London welcomes the Mayor’s call for a halt to the roll out of Universal Credit. In 58 per cent of households due to be affected by Universal Credit there is an adult who is disabled, yet so many aspects of Universal Credit actively disadvantage disabled people, from the digital by default design to the removal of Severe and Enhanced Disability Premiums to discriminatory uses of benefit sanctions.

“As the recent report from the National Audit Office concluded, the government is just not listening to the hardship that Universal Credit is already causing. If the roll out continues many more will suffer so we’re pleased that the Mayor is listening and is taking up this issue on behalf of Londoners.”

ENDS

Notes to editors:

The Mayor’s call to the government follows the GLA submission to the Social Security Advisory Committee consultation on the movement of existing benefit claimants to Universal Credit

Londoners currently in receipt of payments which are likely to be moved to the Universal Credit system include:

• 160,000 working lone parents in London currently claiming tax credits

• More than a million children in London living in families currently claiming tax credits

• More than 120,000 sick or disabled Londoners currently in the support group of Employment Support Allowance

The Work and Pensions Committee received evidence from Croydon, Hounslow, Southwark and Tower Hamlets in September 2017 that rent arrears in their areas had amassed £8m since UC was rolled out, and that more than 2,500 tenants claiming UC were so far behind with their rent that they were at risk of eviction. http://data.parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/work-and-pensions-committee/universal-credit-rollout/written/70154.html

In April 2018 80 per cent of council tenants in Tower Hamlets who were claiming UC (537 of 674) were behind on their rent with average arrears of £1,245. This compares to just 35% of Housing Benefit claimants (2,332 of 6,728) with average arrears of £167.  London Borough of Tower Hamlets, ‘Written evidence to the Work and pensions Select Committee (UCR0243)’, June 2018

Changes to Universal Credit announced in the 2015 budget are forecast to result in a combined decrease in income for claimants in London of £250 million per year by 2020/21. Revised statistics from the authors of Beatty and Fothergill, Sheffield Hallam University, ‘The uneven impact of welfare reform: the financial losses to places and people’, 2016