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8 November 2017

The evidence is clear – Universal Credit is pushing children into poverty

The Budget gives the government an opportunity to put Universal Credit back on track. 

By Debbie Abrahams

It is now three weeks since the government was unanimously defeated in a vote in the House of Commons, 299 to zero. The occasion? Labour’s call for the roll out of Universal Credit to be paused while the government’s so-called flagship social security programme was fixed. Since then, even though the Speaker awarded an emergency debate the following week because the government had failed to respond to this significant defeat – a constitutional conundrum in itself – the government has been silent on the matter.

With the Budget less than a fortnight away, this is a real opportunity for the government to put Universal Credit back on track. Over the last week, we have heard from the Trussell Trust that between April and September, in areas where Universal Credit full service has already been rolled out, foodbank use is 30 per cent higher than elsewhere, that demand for emergency food parcels continues to soar and that there are concerns that they will run out of food in the run up to Christmas.

We have heard from the Child Poverty Action Group that by 2022, the number of children living in poverty is predicted to increase by one million, including 300,000 children under five years old, with 900,000 working age adults also driven into poverty, directly as a result of cuts to Universal Credit. This will affect these children not only as they grow, but for the rest of their lives.

We have heard from Gingerbread that 220,000 parents of three and four-year-old children, the majority of whom are single parents, will be affected by new job seeking requirements under Universal Credit with the threat of financial sanctions if they fail to meet these demands. Single parents are being particularly penalised under Universal Credit. For example, a single parent with two children working full time as a teacher will lose up to £3,700 a year in real terms by 2019.

And I have heard from a young man, a former care leaver, that the government ignored a recommendation by the Social Security Advisory Committee to exempt young people on the “edge of care” from new rules ending housing support for 18 to 21 year olds, as the government deemed that it is “too complex” to identify them. We know that young people are twice as likely to be homeless as people over 25, and nine out of 10 care leavers will end up sofa-surfing. The Homelessness Reduction Act will not help them. Cutting Universal Credit support is putting vulnerable young people at even more at risk because the government can’t be bothered to identify who they are.

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So how does Universal Credit need to change?

We know that there are three causes of the Universal Credit issues we’re already seeing: programme design flaws, administrative issues and deep cuts in funding.

The design flaws are significant; in particular the six weeks people are expected to wait from making a new claim to receiving support is leaving families with nothing to live on. And currently one in four people will wait more than six weeks. The debt, rent arrears and evictions we’re seeing is attributed to this wait.

But there are other issues, including paying Universal Credit to the main earner in the household, predominantly men. For decades it has been known that money given to women is more likely to be spent on their children (my apologies to those men that this doesn’t apply to).

The administrative nightmares of Universal Credit aren’t confined to the extortionate phone lines. A pregnant woman got in touch with me when a change in circumstances meant that she had to apply for Universal Credit when her Employment and Support Allowance claim was closed. She couldn’t apply online and was given one number to call then another, then another and finally she was referred her back to the original number. To say training is needed is an understatement.

And then there’s the cuts to Universal Credit which came in last year and wiped out the key principle of Universal Credit always making work pay. According to the Resolution Foundation, the £4bn cut sees families up to £2,600 a year worse off. It is the cuts that will see our children pushed into poverty.

Labour has been clear from the outset. We support the principles of Universal Credit. But it is failing.

The government finally acceded to Labour’s call for Freephone helplines to be set up. But we also want to see the six week wait period go; a claimant shouldn’t have to wait more than 10 working days to receive their first payment. We want all claimants to be able to decide if they want fortnightly or monthly payments, if they want payments split in the household and if they want the housing payment to be paid directly to the landlord.

Fundamentally, we need to invest in Universal Credit to ensure that work pays and that our children and young people are not pushed into poverty, left destitute or worse.

With nearly a million people set to move onto Universal Credit full service over the winter, the Budget gives the government an opportunity to deliver on their promise “to make the country work for everyone”. I hope they take it.

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