CHC responds to 'Rolling out Universal Credit' report

The NAO has released a report reviewing the current and future impact of Universal Credit on claimants.

The ‘Rolling out Universal Credit’ report said Universal Credit has taken significantly longer to roll-out than intended, and may cost more than the system it replaces. The report also states the Department will never be able to measure whether it has achieved its goal of increasing employment. The watchdog concludes that Universal Credit has not delivered value for money and is uncertain it ever will.

Key report findings

• The roll-out has been considerably slower than was initially intended. It was due to complete in October 2017, but after a number of problems, eight years later only around 10% of the final expected caseload are currently claiming Universal Credit.

• Satisfaction among claimants of Universal Credit and those claiming benefits under the previous system is generally comparable to what it replaces. However, in a recent survey by the Department, four in ten of claimants who were surveyed stated that they were experiencing financial difficulties.

• The Department does not accept that Universal Credit has caused hardship among claimants but the NAO has seen evidence from local and national bodies that many people have suffered difficulties and hardship during the roll out of the full service. The Department has not shown sufficient sensitivity towards some claimants and that it does not know how many claimants are having problems with the programme or have suffered hardship.

• The Department expected most claimants would have enough money to cope over the initial waiting period after their claim is submitted (previously six weeks, now five). In reality, nearly 60% of new claimants (around 56,000 a month) receive a Universal Credit advance to help them manage before receiving their first payment.

• The use of foodbanks increased more rapidly after Universal Credit full service was rolled out to the area. This aligns with the Trussell Trust’s report showing upsurges of 30% in foodbank use in the six months after Universal Credit rolls out to an area, compared to 12% in non-Universal Credit area.

• Local organisations which support claimants and assist in the administration have occurred additional costs. However, the burden of providing proof lies on local authorities. The NAO has also identified that the Department uses its discretion to access claims and has not sought to collect data on wider costs. It will therefore have no means to assess the full monetary impact that Universal Credit is having.

Recommendations

The NAO has recommended the programme does not expand before ‘business-as-usual’ operations can deal with higher claimant volumes, and must learn from the experiences of claimants and third parties, as well as the insights it has gained from the roll-out so far.The NAO also recommends that the Department should capture intelligence on claimants’ issues and the opinions of delivery partners and external stakeholders in a systematic way.

Our view:

Although the Department for Work and Pensions has introduced advance payment loans to support claimants during the five week wait, these can only be claimed once a claimant is verified. To do this online, you need a driving license or passport. Many claimants do not have one of these and so have to wait 14 days until their first appointment to verify and claim an advance.

The advance payments are a loan and need to be paid back to DWP, putting claimants in further financial hardship. DWP have said that they don’t foresee getting the proportion of claimants paid on time higher than 80%. This is unacceptable: one fifth of claimants having to wait longer than five weeks for benefits is not good enough.

Housing associations are allocating a great deal of resources to supporting their tenants to navigate the UC system. However, Universal Credit is less than 10% rolled out in Wales. DWP need to improve the claiming process before the increasing number of UC claims place even greater pressure on housing associations. One way of doing this would be to make the process of verifying online easier.

Will Atkinson, Policy & Programmes Manager said:

“The NAO report shows that the Universal Credit system is still not fit for purpose, with one in five claimants still not receiving their payments on time. We are working closely with the Department for Work & Pensions to improve the system for claimants, including ensuring that Universal Support is available to those who need it and that people can verify themselves online to allow immediate access to advance payment loans.”