A note from the Inclusion Board regarding local implementation of Universal Credit in Wolverhampton, winter 2017/18

 

You will no doubt have seen mention in the media this week about Universal Credit. After 5 years of piloting, the government’s ambitious digital “super benefit”, for all households currently claiming out of work benefits, will begin “full roll out” in Wolverhampton during this December. Over 16,500 local households will be affected in the first year. Universal Credit will replace several existing benefits and be paid (monthly in arrears) to the claimant “head” of the household. This person will be responsible for all online claiming, notification of any household changes and complete family budgeting – including payment of housing costs.

Universal Credit is potentially the largest ever peacetime reform by a UK government. Already employers and HMRC have invested in changing to monthly payroll/tax accounting, to enable DWP to calculate every claimant’s real time income. Once UC is fully “live” landlords, local authorities and other creditors of claimants will also be affected, as well as dependents in every claimant household. The current familiar pattern of different household benefits received at different times will be replaced by a critical single monthly payment, and always in arrears by several weeks.

Other agencies that traditionally assist claimants with advice needs (including housing, social security, food banks and debt advice) are predicting a surge of urgent demand. Even before UC fully starts, many of these agencies are reporting strains to their capacity as some private landlords seek to avoid offering tenancies to claimants of UC.

The cohort of the UK population engaged in job seeking varies (daily) and is very diverse. A proportion will be young, many of whom already confidently conduct their lifestyle interactions by smart phones or other digital devices and routinely work in the “gig” economy. These may find transition to UC both manageable – even desirable.
For a larger group (at least initially) becoming responsible for claiming all household income only via a personalised digital account, paid in arrears, will be extremely challenging. How large this second group is in Wolverhampton, and how quickly they can be skilled to sustain their own UC claim, will be one of the city’s greatest tests in 2018. And if some in this second group simply cannot master the new requirements, then urgent discussions will be required to mitigate their plight and the wider impacts on other affected household dependants and stakeholders.

The recent UK pilots of Universal Credit (usually involving younger claimants, with no dependents) have broadly succeeded, but all at the cost of an increased average rate of rent arrears to landlords (in Wolverhampton over 60% of these young and single UC pilot claimants are now in rent arrears, the value being typically a month of rent). The minister rolling out “full” Universal Credit announced on October 2nd that some claimants will be permitted early payments – a helpful recognition – but this isn’t the only complicating aspect of the implementation.

The true impact of Wolverhampton’s experience of implementing UC will not be fully understood until months after the “go live” dates, but the city’s Inclusion Board has taken the step of alerting key agencies, business leaders and politicians across the city to this uncertain period of challenge – both for some of our most vulnerable households, and the agencies that support them.

The prize of delivering the Universal Credit vision remains attractive. If the UK can develop a sustainable job seekers/benefits claiming system – with agile digital households, financially connected in real time to the State and their jobs, landlords and tax obligations – then it will be a world first, and a totemic statement about twenty first century UK capability. However, the concern of the Inclusion Board in Wolverhampton is that this vision will only become a reality here if we plan, support and persevere with every step of the journey that our claimant households imminently face.

What do we ask you – as a key player in the city – to do at this stage?
• Firstly, make yourself and your organisation aware of Universal Credit and its imminent impact, at the appropriate level for your role – this could be in terms of your interaction with the public, your workforce, or your business activity.
• Secondly, should you encounter anyone needing practical support, refer to Wolverhampton’s Universal Credit hub, already set up and active: http://www.universalcreditwolverhampton.co.uk
• Thirdly, in terms of local policy comment on trends and effects of UC, feedback on the implementation period will be co-ordinated by Heather Clark heather.clark2@wolverhampton.gov.uk

 

 

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