Universal Credit

Part of the debate – in the House of Commons at 2:22 pm on 17th October 2018.

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Photo of Maria Eagle Maria Eagle Labour, Garston and Halewood 2:22 pm, 17th October 2018

The implementation of universal credit has been an object lesson in how not to carry out social security reform. A system that was meant to be fully implemented by April 2017 will not now be fully operational until December 2023, but some of us doubt that even that deadline will be met.

The evidence that we have seen is damning. The National Audit Office says that universal credit has been too slow to roll out, causes hardship and is not delivering value for money. Some claimants waited eight months for payment In 2017, 25% of new claimants were paid late. A fifth of those were the neediest, and waited five months or more. Eight years in, only 10% of claimants are in the system, and the administrative cost is currently £699 a claim—four times as much as the Government intend to spend.

This type of chaos, and the hardship that results, is certainly what we have experienced in Liverpool. I will give just one example, although there are many more in my caseload. My constituent Kelly Redmond has three children, and her mother, who has chronic obstructive pulmonary disease and dementia, lives with her. Tax credits formed an important part of her income. On 28 May, her new partner, who was from Runcorn and claiming universal credit, moved in with her, and she advised the DWP of a change in circumstances. What followed was an administrative farrago of Kafkaesque proportions, allied to official indifference and incompetence, that systematically deprived the family of the means to live.

Her Majesty’s Revenue and Customs cancelled Kelly’s tax credit claim, and told her to claim universal credit. The DWP said that she could not claim universal credit because it had not been rolled out in Liverpool, and told her to claim the tax credits that HMRC had just cancelled. HMRC told her that she could not claim tax credits for six months because her partner was claiming universal credit. It then told my office that it had reinstated her tax credit claim, but it never did. The DWP promised my office on numerous occasions that the issue would be sorted out, but did not sort it out. By the middle of August, the DWP hotline was telling me that the DWP service innovation team and the HMRC transformation team were trying to untangle the mess, and that it would be sorted out by 23 August. It was not. The DWP finally began to process a universal credit claim for Kelly on 31 August by entering a Runcorn address for her on its system. She has never lived in Runcorn, nor has she ever told the DWP that she lives in Runcorn.

Meanwhile, after three months of this chaos, Kelly had been deprived of much of her income and driven into extreme poverty. She was unable to pay for electricity, so her mother, who is supposed to use a nebuliser four times a day to ease her COPD, was frequently unable to do so, and she could neither clothe nor feed her children. The Mayor of Liverpool and local charities were the only people to whom she could turn for help. Only the Mayor’s citizens support scheme, which provided an urgent needs award and a home needs award, provided some relief.

The children were only able to get the school uniforms that they needed because of a grant from the mayoral hardship fund. The family were only able to eat because a local charity, Can Cook, provided three weeks of food for them for nothing. Without Can Cook and the Mayor of Liverpool, the family would literally have starved. The children would not have been able to go to school in appropriate uniform, and Kelly’s mum might be facing even more deterioration in her health because of her inability to pay for electricity. Destitution was certainly beckoning. Instead, Kelly has to cope with severe debt and huge amounts of extra stress.

So far, only 13% of families in Garston and Halewood who will be eligible are receiving universal credit. There are 6,000 more families on legacy benefits who will be subjected to the same nightmare. Only 10% of the children in households in my constituency have been put on universal credit, which means that 5,600 households with children may be about to go through that nightmare. My constituency is about to experience a tsunami of further hardship and poverty because of the roll-out of universal credit. Last year, the Liverpool citizens support scheme and the mayoral hardship fund spent £25 million on supporting homeless people and those in immediate need, but it will not be possible for that to continue on the scale that will be necessary if the roll-out goes ahead, and there will be nowhere else to turn.

It is not enough to slow the roll-out; universal credit must be scrapped. It will never work. It will punish the poor and create more destitution. Any Government who seek to continue with this reform when it is not working and cannot work—when it is not meeting and will not meet its objectives—should be slung out of office, and the sooner the better.