Universal Credit must be scrapped

25 Oct 2018


Universal Credit (UC) was a benefit reform introduced under Part 1 of the Welfare Reform Act 2012. When it was initially introduced, it was clear how the merging of the former Legacy Benefits and Tax Credits system would make the benefit system simpler. However, changes and reforms to the policy, rooted in conservative ideology of austerity, has changed UC from what it was once intended to be into the flawed policy it is today. It cannot be reformed and therefore needs to be scrapped. 


UC initially hit the headlines back in 2017, with many Labour MPs, charities, Advice Agencies and claimants themselves campaigning against the Christmas roll out. Now nearly one year on, UC is once again in the headlines with the Secretary of State for Work and Pensions openly admitting that millions families would lose £200.00 per month as a result of the policy. Whilst many are campaigning for UC to be paused, I believe the campaign needs to go further in calling for it to be scrapped.

To demonstrate why a cash injection into UC and arguing for reform is not good enough, one can look at three issues with the benefit and policy. This is not to say there aren’t more flaws, but it would simply not be practical to go through each failing of the benefit. From the removal of support to disabled people, the cumulative effect of sanctions to the automatic recoverability of overpayment, the list is endless.

It is no secret that so much of the policy is weak. Not only does UC see significant cuts to people’s benefits, but it has at its very core, discriminatory policies. This can be seen through the two child limit, a policy which restricts the number of children for whom the child element of UC will be paid for to two. This is an archaic and discriminatory policy, restricting the right to a private and family life under Article 8 of the European Convention on Human Rights, something which, for now, the UK is still a signatory. It is currently being challenged by the Child Poverty Action Group in the Court of Appeal.


In addition, this policy does not just have legal failings, but also failings in practice. Take for example a family with four children. If they are made redundant or suddenly have an accident and are unfit for work and need to claim Universal Credit, then at least two of these children would not be supported under Universal Credit. The parents would therefore have to ration the support they receive to support four children, who through no fault of their own, are now on the breadline. 



The Advance Payments, something touted by Tory MPs as a fix to the 6-8 week waiting period is also unreliable in practice. Essentially, this is in place due to the Department for Work and Pensions being unable to administer the benefit so claimants are forced to reply on an advanced payment of their benefit. However, it is not a payment, but rather a loan which is paid to a claimant to ensure they can survive the nearly two month wait in some cases until their claim is decided. This has to be paid back over a period of up to 12 months during which it is taken out of their regular UC payments. Claimants, as outlined by Secretary of State for Work and Pensions Esther McVey, who are already losing £200 per month will have their income reduced even further if they rely on an Advance Payment.

Finally, the fact that Universal Credit has been amalgamated means that the former Housing Benefit element of the social security system is now part of their entire benefit award. This is an issue for two overarching reasons. Firstly, many people will not be aware that their rent is now part of their award, which can lead to people budgeting things such as heating, food, electricity and other essentially from this award. As a result, people are unaware that their housing element is not paid direct to their landlord, as their Housing Benefit may have been previously are slipping into rent arrears without knowing it.


Secondly, people who are seeing a reduction in their awards but no reduction in their financial pressure are forced to use the housing cost of their UC award to feed and clothe their children, ensure they have a warm home, and pay wider bills. People are slipping into rent arrears at an unprecedented rate. We now see a two tier housing sector, where UC claimants are treat as second class tenants and literally barred from renting in some sectors. 

Taking the above into account, it is clear to see that simply pausing and giving a cash injection to UC will not remedy the mechanical issue with the policy itself. The discriminatory two child limit, the flawed Advance Payments system, the 6-8 week wait for payment, the messy amalgamation of housing costs and other entitlements will still be prevalent issues. Reforming UC would only prolong the survival of a toxic brand which is unfit for purpose in its current policy intention and practice. 


UC must be scrapped in favour of a radical ethical alternative, built from listening to advice agencies and claimants. It is vital that as a society, we are able to care for those who fall on hard times. So many are in need of additional support as a result of disability, illness or other reasons, it is our duty to take care of them. Sadly, UC will never be able to do this.

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