The National Audit Office (NAO) has today released a damning report on the Universal Credit system.
This report comes just a day after the first Universal Credit legal case brought against the Secretary of State for Work and Pensions saw a ruling in the claimants favour.
There has been significant delays to the roll out of the new system, which was due to be complete in October 2017, and the NAO believes it may even cost more than the current benefits system that it is replacing.
Currently there is only 10% of the expected caseload claiming Universal Credit. And many of those claimants have experienced delays, financial difficulties and struggle to understand the new complicated system. In a recent survey by the Department for Work and Pensions (DWP), four in ten of claimants who were surveyed stated that they were experiencing financial difficulties. The DWP 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.
In 2017, around one quarter (113,000) of new claims were not paid in full on time. Late payments were delayed on average by four weeks, but from January to October 2017, 40% of those affected by late payments waited in total around 11 weeks or more, and 20% waited almost five months. Despite improvements in payment timeliness, in March 2018 21% of new claimants did not receive their full entitlement on time with 13% receiving no payment on time.
The Department does not anticipate payment timeliness to improve significantly in 2018. On this basis, the NAO estimates that between 270,000 and 338,000 new claimants will not be paid in full at the end of their first assessment period throughout 2018. Those with more complex cases are more likely to be paid late.
The Department believes it will never achieve 100% payment timeliness because it needs by law to verify the claimants’ eligibility.
The NAO noted increases in rent arrears in areas where Universal Credit was introduced, reported by local authorities, housing associations and landlords. Some private landlords told the NAO they have become reluctant to rent to Universal Credit claimants. In three of the four areas the NAO visited and for which data was available, the use of foodbanks had increased more rapidly after Universal Credit full service was rolled out to the area. This agrees 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 areas.
Amyas Morse, head of the National Audit Office, said today:
“The Department has kept pushing the Universal Credit rollout forward through a series of problems. We recognise both its determination and commitment, and that there is really no practical choice but to keep on keeping on with the rollout.
“We don’t think DWP has shown the same commitment to listening and responding to the hardship faced by claimants. Maybe a change of mind set will follow the publication of the claimant survey on 8 June. We think the larger claims for Universal Credit, such as boosted employment, are unlikely to be demonstrable at any point in future. Nor for that matter will value for money.”