By Dr Bridget Meehan, Policy Officer, Advice NI
The inevitable Move to Universal Credit (UC) got underway in Northern Ireland this April. UC is the biggest change to the social security system since its inception so naturally people are apprehensive. While it can’t be avoided, the negatives can be mitigated. Advice NI’s research report Move to UC – Get ready highlights the concerns of advice sector advisers and benefit claimants around the upcoming Move to UC and makes recommendations aimed at easing the worst impacts, especially for the most vulnerable.
The ‘Move to UC’ refers to the UK government’s plan to migrate or move ‘legacy’ benefit claimants on to UC, where ‘legacy’ benefits refer to the working age means-tested benefits that are to be replaced by UC i.e. Tax Credits, Housing Benefit, Income Support, Income-based Jobseekers Allowance and Income-related Employment and Support Allowance.
In anticipation of the imminent Move to UC, Advice NI conducted a survey where we gathered the concerns about the Move to UC directly from advisers working on the ground and from legacy benefit claimants, as well as the lived experiences of claimants already on UC. Our findings revealed multiple key issues that advisers and legacy benefit claimants are worried about. We discuss two of the most pressing issues here: the digital nature of UC and the financial implications of moving to UC.
UC is a digital benefit
UC is a digital benefit, making it like no other benefit that has come before it. Being digital, it means that people must apply for and manage their claim online, taking for granted that claimants have competent digital skills as well as access to the Internet and a digital device. This will be a challenge for many and 52% of the advisers surveyed were apprehensive about how claimants with poor digital skills were going to manage. The remote nature of a digital benefit is further cause for concern when it comes to vulnerable claimants with poor physical and mental health who may need face-to-face help when applying for and maintaining UC. In NI, many rural areas have limited Internet access so UC presents greater challenges for them. Forty-seven percent of legacy claimants also expressed anxiety about being able to cope with a digital benefit that required Internet access and the ability to manage a Journal. One respondent said that “I have digital skills but don’t feel confident managing a claim completely on my own; I will need help and will probably have to ask family which is embarrassing.”
The existing UC claimants who took the survey also talked of the difficulties of dealing with a digital benefit. The online application process was difficult and many needed to make their claim by telephone, an option they said wasn’t always available. Maintaining the claim was difficult too as not all claimants had regular and dependable access to the Internet or adequate digital devices. And they had problems with the Journal, the main mode of communication between UC claimants and their work coaches. Some were unable to access their Journal on a daily basis, others didn’t receive timely enough responses to queries, and still others found it hard to keep up with the sheer volume of messages. Not responding to Journal requirements on time can have serious consequences such as payment suspension and sanctions.
Financial challenges of moving to UC
Predictably, being able to manage financially was a top concern for both advisers and claimants. Fifty percent of advisers were worried about how claimants were going to cope with the 5-week wait for the first UC payment which they knew from experience would make it impossible for most claimants to budget and would inevitably lead to housing arrears and debt. Finances were a looming dread for 71% of legacy benefit claimants and they cited fears about the 5-week wait, getting into debt and rent arrears, ending up with overpayments, losing premiums they currently were in receipt of, and not being able to afford upfront childcare costs.
The experience of the UC claimants revealed that these fears were not unfounded. Waiting for the first payment pushed many into debt, with 69% of those surveyed needing to borrow the UC Advance loan; 47% needing to borrow from family, friends, their bank, Credit Union or doorstep lenders; and 53% ending up in rent arrears. Claimants also mentioned difficulties paying upfront childcare costs. Once in receipt of UC, claimants found it challenging to cope on their regular UC payments. These payments are low to start with but they’re often subject to deductions for debts such as the UC Advance, overpayments, and rent arrears. For example, one UC claimant said that “I struggle with rental shortfall and Discretionary Housing Payments don’t cover it all”; another claimant who was a self-employed farmer on Tax Credits said that moving to UC “seemed to have caused an overpayment of Tax Credits and I don’t know why or how it happened”; and a parent claiming UC “struggled with upfront childcare costs and have found that really difficult to recover from.”
In response to these findings, Advice NI has proposed a series of recommendations. To avoid potential financial hardship, we believe there are a number of actions that could be taken by the Department for Communities (DfC), the department responsible for social security in NI:
- Make claimants fully aware of the financial supports available such as the Contingency Fund and Rates Rebate, and do so as an embedded part of the UC application process.
- Emphasise the fact that the UC Advance is a loan with strict repayment rules.
- Provide upfront childcare costs for those moving from Tax Credits to UC.
- Inform claimants of overpayment waivers and write-offs, and make these options as easy as possible for claimants to avail of.
- Apply discretion when it comes to the recovery of overpayments that are a result of official error.
There are further actions DfC could follow in order to reduce the digital challenges UC presents:
- Ensure claimants are online-ready i.e. that they have adequate access to the Internet and to an IT device.
- Provide claimants with digital skills training.
- Train staff to assist claimants with their digital claim.
Underpinning a Move to UC that minimises distress and hardship, is the availability of free, high quality, independent advice. We propose that DfC:
- Provide the independent advice sector with the additional resources needed to meet extra demand the Move to UC will place on the independent advice sector.
- Create clear escalation pathways between UC staff and the independent advisers that give advisers real-time access to UC staff e.g. allowing access the Journal (with formal consent from clients); having a dedicated hotline or online chat based on implicit consent.
- Conduct regular, dedicated monitoring sessions with the independent advice sector all the way through the Move to UC journey.
At Advice NI, our goal is that DfC will follow through on the recommendations in the report as a means of mitigating the worst impact of moving to UC.
Dr Bridget Meehan is a policy officer at Advice NI, the membership body for the independent advice network in NI. Visit the Advice NI website for more information, or connect with us Facebook, Twitter and Instagram.