Branch Guest Speaker: Dan Norris, Child Poverty Action Group on Universal Credit

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The CPAG works on behalf of children in the UK growing up in poverty with a core focus on understanding drivers of poverty, the impact it has on children’s lives, and how it can be prevented and solved.

The CPAG’s stated vision is ‘of a society free of child poverty, where all children can enjoy a childhood free of financial hardship and have a fair chance in life to reach their full potential.’ The CPAG:

  • Develop and campaign for policy solutions to end child poverty
  • Provide accurate information, training and advice to the people who work with families to help them receive the financial support they need
  • Carry out high profile legal work to establish and confirm families’ rights.

Universal Credit (UC)
UC is the biggest change to our social security system in over sixty years. It will eventually replace many of the current benefits and tax credits for people of working age. With the national roll-out underway, increasing numbers of people can claim universal credit including families with children, those with health conditions and those in work.

In short, UC is a means-tested benefit for people of working-age who are on a low income. UC replaces six existing means-tested benefits essentially squashing them into one. They are: Income Support, Income-based Jobseeker’s Allowance, Income-related Employment Support Allowance, Housing Benefit, Working Tax Credit, Child Tax Credit.

At present only about a million households are receiving UC, of the 7 million eventually expected to move on to it. From next year the DWP will extend the UC rollout and will start asking 2 million households receiving so-called ‘legacy’ benefits to apply for UC, giving each of them a deadline to do so. This process is known as ‘managed migration’. The remaining 4 million will come on to UC through new claims, either claiming benefits for the first time or because they have a change of circumstances (known as ‘natural migration’).

Reasons for Universal credit
UC is a revolutionary implementation resulting in a significant change to the way in which benefits are distributed. There are 4 key reasons for the Government’s implementation of Universal Credit. The Government claims that Universal Credit is designed to:

  1. Incentivise work
  2. Prepare people for work
  3. Simplify access to benefits / increase efficiency of system – instead of HMRC, DWP and Local Councils providing different benefits which need to be individually accessed – recipients only have one port of call.
  4. Reduce costs to Government


Key Concerns about Universal Credit
There are a number of concerns that people have with Universal Credit. From cuts to lone parents and disabled people to exacerbating domestic abuse. The policy has come under increasing scrutiny in recent times, with many calling for an end to Universal Credit. Key problems include:

  1. Difficulties making a claim: Claims for UC are normally made online. Some claimants who cannot claim due to poor literacy skills or difficulties using computers may be able to make a claim by telephone. However, the lack of human interaction has exacerbated problems such as proving ones identity, systematic mishaps or inserting the wrong information such as date of birth. The system can then automatically shut people out or demand people reclaim. An extended application process can force people into arrears and prevent people accessing the necessary benefits needed to feed their children, pay rent and other bills.
  2. Reporting earnings: UC claimants who work do not normally need to report their earnings, as details are provided by HMRC (using real time information) which shares information with the DWP on how claimants have been paid. However, in some instances, the DWP can receive incorrect information on a claimant’s earnings, dramatically affecting their entitlement.
  3. Disappearing premiums for people with long-term health conditions: Under the legacy benefits system, some claimants – those who received the enhanced daily living component of personal independence payments or were in the support group for ESA – received extra amounts known as the enhanced and severe disability premiums. These premiums are abolished under UC and people who received them under legacy benefits such as ESA, and then move to UC because a change in circumstances means they have to make a new claim for benefits (e.g. their ESA stops when they fail the work capability assessment), cannot receive them under UC. This can lead to an unavoidable significant loss of income for people with long term health problems.
  4. UC is capped at two kids: People will not receive money beyond two kids. Under the old system, the more children you had, the more one was entitled to. This raises questions about children’s prospects, social mobility, quality of living and care.

Known as ‘managed migration’ the Government plans to continue the roll-out of Universal Credit in full in Croydon and the UK more wide.

CPAG have published a factsheet which can be found here.