The next stage of Universal Credit: what should the new Secretary of State do?

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A blog post by
Sumi Rabindrakumar
Head of Policy & Research 

The new Secretary of State has said she wants to make sure that Universal Credit “becomes a force wholly for good”. After successive cuts, flawed design and problematic delivery, this is a bold ambition. Her first test will be the much-anticipated next stage of Universal Credit roll-out – ‘managed migration’.

The government is poised to debate regulations which determine the process for the next stage of Universal Credit, where people claiming benefits under the old systems will need to move to the new benefits system. The task at hand cannot be underestimated. Three million people will have their benefits stopped and will need to reapply to continue to receive support.

The Trussell Trust, among others, voiced strong concerns that the government’s original proposals placed the burden of transfer entirely on claimants, putting at risk their income and vital promised protection for people receiving legacy benefits (‘transitional protection’).

The government’s revised proposals show some positive steps forward. These include more realistic deadlines for making new claims and additional two-week benefit payments to manage the five-week wait for a first payment. But, based on the evidence from our foodbank network, we know much more is needed to ensure people do not continue to be pushed into crisis by moving onto Universal Credit:

  • People still risk losing income, as old benefit payments will be stopped rather than automatically transferring people to the new system. There are many reasons why someone may not be able to apply for Universal Credit, for example if they are anxious about letters or do not understand the process. There is a very limited timeline for backdating, so missing your ‘deadline day’ can have serious consequences.
  • Testing has high stakes with little public scrutiny. A slow approach to the next stage of Universal Credit is sensible, but the success of transfer now rests almost entirely on the ‘test and learn’ process from July 2019, for around 10,000 claimants. The Department for Work & Pensions has committed to involving stakeholders and publishing an impact assessment before expanding ‘managed migration’, but has not stated what impact it will measure.
  • People will continue to suffer in the meantime. Hundreds of thousands of people will transfer to Universal Credit in the coming months, before ‘managed migration’ officially starts. Common life changes which leave you needing support, such as a separation, moving house, or losing a job, will mean you need to apply for Universal Credit. People in this position won’t see the improvements promised, and will still bear the brunt of the five-week wait for a first payment, until at least July 2020.

The now-former Secretary of State for Work and Pensions provided reassurances that the Department will take a “measured approach…to get it right”. Her successor has already acknowledged there are some “not insignificant areas that need changing”.

But words alone are not enough.

Parliament needs to vote to pass these regulations; we are calling on the government to use this opportunity to address the issues raised here and by others. Testing the use of existing information to generate new claims rather than dismissing this out of hand, agreeing success criteria for ‘test and learn’, providing the same support for people ‘naturally’ moving onto the system in the coming months and years – these are all firm and transparent commitments that can, and should, be made.

Too many people – claimants, volunteers, charities, local services – have borne the brunt of the government’s failings over Universal Credit to date. As the UN envoy reported last Friday, foodbanks cannot step in to do the government’s job.

Our benefits system should anchor people from being swept into poverty. The final stage of Universal Credit roll-out will be an important measure of how seriously the government takes this responsibility.

When these regulations are debated in the coming weeks, the new Secretary of State has a chance to do more than just listen. Instead, she can show that we have a government genuinely willing to protect people from crisis and make real improvements for households across the country.