Universal Credit: ever-growing number of people left in arrears

Universal Credit is still pushing tens of thousands into financial crisis just weeks ahead of the second half of its introduction, an investigation by JPIMedia has found.

By Martina Moscariello
Tuesday, 4th June 2019, 3:36 pm
Universal Credit is leaving an ever-growing number of people in rental arrears, an investigation by JPIMedia has found.
Universal Credit is leaving an ever-growing number of people in rental arrears, an investigation by JPIMedia has found.

The controversial benefit, which was rolled out in 2018, is leaving an ever-growing number of people in deep rent arrears.

Kieron Joyce, from Scarborough, had to rely on the system after being forced to take a break from work on health grounds.

The 27-year-old bus driver applied for Universal Credit in March and only received his first payment last week.

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Rental arrears figures explained.

He said: “My first claim was cancelled due to me not accepting my commitments online, which no-one told me I needed to do, so I had to start it all from fresh. Two weeks later I was told my first payment would be at the end of May.

“I have been very dependent on help from my parents and have racked up debt on household bills and council tax due to having to wait nine weeks for any money.”

Kieron, who lives with his partner and his two young children aged five and four, said that dealing with the process has made him upset and frustrated.

“I left school in 2007 and was in college until 2010,” he added, “I have always worked and paid all my taxes and national insurance. I’ve never had such a bad experience in my life.”

The father of two has now started working again on a part-time basis. This is in spite of being diagnosed with two slipped disks and a trapped sciatic nerve.

“I don’t feel fully ready but I need to at least try. I have a family to support.”

In Yorkshire and the Humber data from 11 local authorities in the region shows that 15,844 people are in rent arrears to the value of £8,879,713 – over a tenth of what is owed nationally – compared to £6,074,111 owed by almost double the number, 31,079, in arrears under Housing Benefit.

With millions more people poised to be moved onto the system, charities have called for an urgent halt to the programme.

Stephanie Kleynhans, policy officer at Shelter, said: “Our services are telling us quite regularly that they are seeing a lot of problems with Universal Credit that could put people at risk of rent arrears or homelessness.”

The Department for Work and Pensions said it was wrong to blame Universal Credit for rent arrears.

“We completely disagree with this analysis which compares fundamentally different claimant groups,” a spokeswoman said.

“Many people claim Universal Credit after a significant life event and will join with pre-existing arrears, while those on legacy benefits are likely to have been claiming for a longer period, with arrears having reduced over time.”

She said the department had made various changes to Universal Credit to prevent people going into arrears.

This included paying two weeks of extra Housing Benefit for those moving onto Universal Credit and paying rent directly to landlords where requested.

Universal Credit was meant to save money and simplify the welfare system by replacing six benefits for unemployed people or those on low incomes with one monthly payment.

But it has faced repeated criticism for leaving many claimants worse off than under legacy benefits and for an error-prone system that can drive some to the brink of destitution.

So far, only new benefit claimants or those whose circumstances have changed have been placed on Universal Credit. In Scarborough this amounts to more than 3,300 people.

Now the second phase –moving more than 3m people on legacy benefits – is set to begin in July with a trial in Harrogate.