By Tim Rawlinson
The charity Christians Against Poverty released some reports into the impact of Universal Credit on their clients. Below are links to the reports with some quotes from them underneath each link. They make interesting reading and I urge you to read the full reports regardless of your religious affiliation as they are non political/religious and highlight the impact of UC on real people.
This report highlights the struggles of the wait for the first Universal Credit payment and how clients struggle applying.
‘I got a letter saying I couldn’t be on JSA any longer as Universal Credit had been introduced in my area. They cancelled my Housing Benefit and I applied for Universal Credit in early June but I didn’t get any money until August. It seemed longer. I was left around ten weeks without any money. I had been through a Debt Relief Order (DRO) but now I’ve been left in more rent arrears through no fault of my own. Waiting for my first payment was really stressful. I was struggling because I didn’t want to take out more debt. My boyfriend helped a lot but I’ve always been quite independent so I found that difficult. My housing officer was also understanding and put me in touch with CAP and the food bank. I made my claim online because I couldn’t get through on the phone. I was on hold forever and I didn’t have the money on my phone. I have no Internet at home so I walked to my local library which is quite far away, but I’m quite good on computers and I didn’t have to wait very long for one. The form was quite long and I only had one hour to complete it. I did struggle to remember my past addresses. It’s hard to remember the postcodes and I don’t have them written down. I’ve been homeless before and have had lots of care-of addresses, so it’s hard. The ID was also tricky because I’ve never had a passport. I had to buy new copies of my birth certificate but the DWP did help with the cost of that.’ Debbie, 28, CAP client
This report exposes how Universal Credit pushes people into debt.
‘It definitely didn’t help the debt situation. I did have debts before I came across to Universal Credit but it doesn’t help when the system, either by design or by accident, leaves you just on the nick of the poverty line constantly. It just compounds everything. Every month I’m ringing people to say I can’t pay, even though I’ve only got very small bills; £9 a month phone, I don’t have internet, I don’t have Sky, or anything like that. Everything is cut down to the bone and I’m still living hand to mouth. I try not to go [to the food bank] when I don’t have to, but I’ve always been using the food bank while I’ve been on this benefit. I had to use the system of borrowing money and thank goodness because I had zero money. They said they’d take it back at a rate I could afford but started taking it back at £130 a month of the £190 I had to pay my living costs. As soon as I got my benefits I was left with £60 for the month.’ Paul, 45, CAP client
Interest-free loans, known as advances, are available to tide claimants over until their first Universal Credit payment. These loans must be repaid within twelve months, typically through benefit deductions.4 This means most Universal Claimants find themselves in debt as soon as they start to claim the benefit. As explored in the first paper in this series, there is much trepidation about this, but claimants have few alternatives. Whilst advances provide some relief during the wait period, the problem is pushed downstream and it is common for advance repayments to leave claimants in hardship once payments start. All participants who had taken out an advance felt the repayments were unaffordable or did not leave them with enough to live on. In particular, the restricted repayment term of twelve months meant the repayments formed a substantial proportion of their income. From October 2021, the repayment term for advance payments will be extended to 16 months which will see claimants’ monthly repayments fall by 25%. For example, repayments for a £300 advance will fall from £25 to £18.75 a month. Yet, this relief is three years away and will be slight, as the pressure of repayments is felt acutely due to low income and already living on tight budgets. This saw participants continuing to use food banks and falling behind with household bills, as well as restricting their ability to pay off other debts, such as rent arrears, incurred during the wait for their first payment.
‘I’d been claiming Tax Credits since my divorce and it had really helped. Universal Credit was then phased into my area and so I made a claim. I had trouble because my Housing Benefit stopped. They factor your housing into the Universal Credit payment but they forgot to process that bit so it took a couple of months to come through. I work 22 hours a week and I find it very difficult to budget because my Universal Credit payment fluctuates so much. It’s never what they say it’s going to be. I look at my online account and it shows a figure but you can’t rely on it. It can be a big change, like £300. I took on a second job for a bit but I didn’t realise that for every pound you make they take 65p off. So working 24 more hours in one week meant I didn’t get much more money at all and I was absolutely exhausted. I was working 12 hours overnight and I made peanuts. It was damaging my health so I couldn’t do it. The months when I receive less Universal Credit I just do my basic shopping and that’s it. My sister’s very poorly, but she lives 100 miles away so I can’t afford to see her. I don’t like asking for money and my Dad’s a pensioner so I can’t ask him. Without Universal Credit I’d be at a minus every month so it does help, but I’m living from day to day.’ Sally, 48, CAP client 4
The actual reports go into much more detail about the impacts of Universal Credit than the quotes here. Most of which debunk Government propaganda about the scheme. The reports are too long to paste in full, but not lengthy at all.
A charity actually telling the truth for once.