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Universal Credit is currently overseen by the Department for Work and Pensions (DWP) to provide Britons with regular financial help. Universal Credit is designed to simplify the benefit system in the UK, making it easier for those eligible to claim one central benefit, rather than the six legacy benefits it is to replace. The benefit is being slowly rolled out, and all those eligible to receive it should be transferred over onto the system by 2024.
However, a recent report has suggested the system as it currently functions is failing those who need help.
The Lords’ Economic Affairs Committee, a cross-party group, looked into the scheme but has called for urgent changes to take place.
The committee stated that while the aim of Universal Credit to simplify the benefit system was well-intentioned, the design needed improvement.
It has blamed the scheme’s design for “soaring rent arrears and the use of foodbanks”.
There were various recommendations set out by the Lords Economic Affairs Committee, concerning Universal Credit.
The committee stated the £20 a week rise in payments issued by the government due to the impact of COVID-19 should be made permanent to ensure claimants are getting enough.
Furthermore, the committee has called for a “more carrot and less stick” approach when it comes to punitive sanctions, which it has stated can often be counterproductive.
Another issue raised was the five-week wait built into the system.
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Under current rules, new claimants to Universal Credit are required to wait for five weeks before receiving their first payment.
The committee has said the wait often “entrenches debt, increases extreme poverty, and harms vulnerable groups disproportionately”.
As a result, it has told the government to introduce a non-repayable two-week grant to all claimants to help them financially.
Lord Forsyth, the chairman of the committee, commented on the findings, stating: “Most people, including our Committee, broadly agree with the original aims and objectives of Universal Credit. However, in its current form it fails to provide a dependable safety net.
“The mechanics of Universal Credit do not reflect the reality of people’s lives. It is designed around an idealised claimant and rigid, inflexible features of the system are harming a range of claimant groups, including women, disable people and the vulnerable.
“Universal Credit needs more money to catch up after 10 years of cuts to the social security budget. It requires substantial reforms to its design and implementation, the adequacy of its awards, and how it supports claimants to navigate the system and find work.”
If the recommendations are taken up by the government, then it is likely Universal Credit could undergo wide-scale change.
This is likely to have a palpably felt impact on the millions of people who claim the benefit.
Will Quince, Welfare Minister, welcomed the recommendations by the committee, but insisted the system had fared well, especially under the strains of COVID-19.
He said: “The case for Universal Credit has never been stronger. The system defied its critics in unprecedented and unforeseeable circumstances.
“We remain committed to supporting the most vulnerable in society, which is why we currently spend over £95billion a year on the benefits system.
“We welcome the acknowledgement by the committee that Universal Credit is here to stay, and we will consider their recommendations in detail.”
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