BBC Two’s three part-series into Universal Credit

by CARIDON LANDLORD SOLUTIONS

9:47 AM, 6th February 2020
About 6 months ago

BBC Two’s three part-series into Universal Credit

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BBC Two’s three part-series into Universal Credit

On Tuesday 4th February we saw the first of BBC Two’s three-part series about ‘Universal Credit: Inside the Welfare State’.

Universal Credit is the biggest overhaul of the welfare state in a generation. It was designed to simplify the benefits systems and encourage the unemployed into work. However, since its introduction, Universal Credit has been linked to increased rent arrears, stress, debt and food bank use as claimants are forced to wait five weeks for a first payment after moving on to the new system.

The first episode followed staff and claimants at Peckham Job Centre.

One major pitfall demonstrated on the programme was the five week wait new claimants experience before they start getting paid, a huge problem since many of them are already struggling to pay off loans they’ve been forced to take out to survive. Single mother-of-two Rachel was seen growing increasingly distressed as the mount of Universal Credit she would receive became reality.

Rachel is entitled to £997 per month, made up of £317.82 as a standard single allowance and an additional £508.75 because she had two children. She would receive more, but due to the five week wait, Rachel had been forced to apply for an advance, money which is now being paid back from her monthly entitlement to the sum of £109.87. After rent and bills, Rachel is left with £138 to live off.

What is most alarming to us at Caridon Landlord Solution is that, despite UC being designed to make work pay and empower the claimant to manage their own money, Rachel openly said she would struggle and would prefer the housing element of her payment to go directly to the landlord, in this case the local authority. This was always the case with the old-style housing benefit.

However, the system now is such that Rachel must meet certain Tier 1 or Tier 2 criteria in order for this to be accepted. To us, this means that the claimant is never really in control, even when they are trying to be responsible by ensuring rent is paid on time to the landlord through direct payments. When tenants can clearly see they will fall into rent arrears, it is little wonder that private landlords have been dissuaded from letting to tenants in receipt of housing benefit.

Another claimant, Declan, found himself homeless at 47 and depending on food bank vouchers after being made redundant and failing to find a replacement job in the construction trade. He is desperate to get a job but has so far had no luck.

Then there was the case of 61-year-old Phil who was indignant at being pressured to find a job after spending 10 years unemployed and living off benefits.  Phil did eventually take a job which paid minimum wage of £8.25 an hour.  Phil calculated he would only be £30 a week better off which he says is not much of an incentive to work a 37.5 hour week.

We don’t believe that Universal Credit is complete failure as there are cases where it works, but it has been poorly implemented and needs adjusting according to individual circumstances, not a blanket decision for all.

We will be watching the rest of the series closely and using our own experiences to form a response to the Lords Select Committee’s call for evidence into the economics of Universal Credit.

The deadline for submissions is 29th February. Landlords we would like to hear you views. Email Sherrelle Collman at sherrelle@caridon.co.uk



Comments

Old Mrs Landlord

14:44 PM, 8th February 2020
About 6 months ago

The initial five-week period with no money unless they get into debt is a major fault of the system and has only been ameliorated by one week since it was first identified as the biggest problem. However, UC does mean that the choice of a life on benefits is much less attractive than formerly for those who are capable of work. Both Rachel and Phil were incentivised to get back into the workforce and both had more dignity and self-respect and were happier and more fulfilled as useful members of society with prospects of moving to a better-paid role as they gained experience, rather than a future dependent on hand-outs. For those who genuinely cannot work, however, it can be a miserable existence. You are right that it has been poorly implemented and lacks flexibility to accommodate individual variations of circumstance.

Jonathan Clarke

19:42 PM, 8th February 2020
About 6 months ago

UC was introduced in 2013 and still 7 years later it feels like its still in its infancy . The idea had merit but the implementation has been almost criminal in how it abuses human rights by leaving people without food for 5 weeks . It is the direct cause of me after 21 years of housing the homeless to stop taking on anyone new on HB . LHA had it faults but all mine were paid direct and it worked . UC stopped all that . The communication from the DWP is abysmal . No one but no one in authority has the duty to even tell me when a tenant of mine goes from LHA to UC. This is a 3 way relationship but my needs are simply just ignored . So the first time I find out is when my LHA doesnt come in and they are now 4 weeks in arrears. Why doesn`t someone in authority have the decency to even tell me? The tenants often keep the money as they in many instances have not the skills to manage their finances.
Give a recovering drug addict £700 and the chances are they wont pass it on . Its cruel to give them that money .The temptation is far too great. But no one bothers to ask me for a reference or a summary of their tenancy for the past 5 years before they click the button and pay them rather than me . They do it all behind my back . Its criminal neglect in my view
Its a total disgrace
Its not fair on the Job Centre staff
Its not fair on the landlord
Its not fair on the tenant who is set up to fail
The faults are so obvious and seismic that anyone with a modicum of intelligence can understand those faults . But there is a institutional culture which just ignore the faults in the system . This I have come to understand is now I believe a deliberate act on the part of government because the faults are so so obvious and the sad thing is they are preventable .
If you haven`t fixed it after 7 years you have no intention of fixing it. They just tinker around the edges .The 6 week to 5 week reduction wait for money was a monumental farcical decision. This demonstrated it was just a paper exercise
Shocking

CARIDON LANDLORD SOLUTIONS

23:07 PM, 8th February 2020
About 6 months ago

The Lords Select Committee is calling for evidence into the economics of Universal Credit.
The deadline for submissions is 29th February. I really would urge all landlords to comment. Please email me your views, experiences and effects that Universal Credit has on had on you as a landlord and how it has effected your tenants.


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