Universal Credit Not Living up to it’s Promise

February 10, 2016

Lucy_2 (Custom)By Lucy Palmer-Richeson

A new report by the Institute for Fiscal Studies (IFS) think-tank has shown that Universal Credit is failing to live up to its promise and that working families are now worse off since the benefit was introduced.

Universal Credit, the government’s new welfare programme that will combine six benefits into one monthly payment, was designed to cut the welfare bill and to encourage people who are not working to seek employment.

However, the IFS report shows that 2.1 million working families will receive £1,600 less under Universal Credit. Single parents who work will be the most affected demographic, losing on average £1,000 a year, meaning they have less of an incentive to stay in employment.

The report also shows that 1.8 million households will gain an average £1,500 under the plan, and that the yearly benefits bill will be cut by £2.7bn.

National charity Citizens Advice say that they are receiving over 150 enquiries a week from people seeking advice about Universal Credit, many from people unsure about who is able to claim the benefit and how to make a claim.

Gillian Guy, chief executive of Citizens Advice, said: ““The principles underpinning Universal Credit, of simplifying the welfare system and making every hour of work pay, are sound and should be protected. The Government must be watchful that any changes to the benefit do not undermine work incentives and reduce the support people need to stay in work.

“The roll-out of Universal Credit won’t be a success unless people are properly prepared, and those who need help with their claim can access the support they need.”

A spokesperson for the Department for Work and Pensions spokesman said: “Universal Credit is transforming lives across the country, with claimants moving into work significantly faster and earning more than under the old system.

“Universal Credit is on schedule and will be in all Jobcentres by Spring. Once fully rolled out it will generate £6.7bn in economic benefit every year.”