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Publication - Speech / Ministerial Statement

Universal Credit rollout: ministerial statement

Published: 3 Oct 2017
Date of speech: 3 Oct 2017
Delivered by: Minister for Social Security Jeane Freeman
Location: Scottish Parliament

Minister for Social Security Jeane Freeman updates the Scottish Parliament on choices available to Scottish claimants of Universal Credit.

Presiding Officer

I am bringing this motion to the Chamber today, to allow this Parliament to make clear its position on Universal Credit and to give Parliament the opportunity to show it is on the side of the people being damaged by a system that needs to be halted until it is fixed.

Despite repeated requests from people who are suffering under this new system, from councils, charities, housing associations and Parliamentarians from all parties – most recently 12 Tory MPs and Dame Louise Casey - the UK Government continues to shamelessly ignore calls to halt the roll out of full service Universal Credit.

So let me highlight again why this system must be halted – because of the overwhelming and compelling evidence the Universal Credit system is fundamentally flawed. And what is broken must be fixed or because of the UK government's reckless behaviour - we will continue to see more and more people plunged into debt and despair as Universal Credit is rolled out unchanged.

There are two critical areas of problem. In policy, the in-built 6 week wait for the first payment runs entirely contrary to the UKG stated intention for this benefit.

6 weeks is a minimum wait and as we know - and the Westminster Work and Pensions Committee heard - it can often be much longer. And for the first seven days there is no payment.

UC, the Tories tell us, is meant to mirror employment. But who waits 6 weeks to get their first pay packet?

How many can live without money coming in for 6 weeks, especially if you have children or dependants, rent to pay, food to buy, and bills to pay.

And it's ignoring the fact that for most of those who will receive UC when it's rolled out, will be in work and will be entitled to this money because of low wages or hours and they need additional financial help with costs of children and housing.

In truth, the 6-week wait was incorporated into the design of Universal Credit simply to save the UK Government money. Saving money by imposing a 6-week wait on those who can least afford it. Saving money with scant regard to all the evidence that their Tory policy plunges people already on low incomes into debt, rent arrears and, in some cases, homelessness.

More and more people forced to rely on foodbanks and emergency grants, including the Scottish Welfare Fund crisis grant.

This is not just a problem in Scotland, but across the whole of the UK. Frank Field, MP and Chair of the Work and Pensions Committee at Westminster recently called for a "Christmas truce" on the "human and political catastrophe" that is the roll out of UC.

Last week, I joined forces with Cosla to again call for a stop to the roll out of full service Universal Credit until the system is fit for purpose.

We presented detailed evidence about the impact of Universal Credit on people and local authorities, which is frankly staggering.

It shows that in East Lothian - one of the first areas in Scotland to go live with full service Universal Credit - average rent arrears for tenants in receipt of Universal Credit is £1,022 compared to £390 for those in receipt of housing benefit – almost 3 times higher. All making it difficult for tenants to find and keep a home.

Those rent arrears bring not only worry and hardship on tenants, they also pose real problems for social landlords looking to the invest in the further house building we need.

And for those four local authorities where the full service is in place, administration costs have risen in total to over £830,000.

No local authority should have to cover the failings of the UK government from their own budgets. Time and again the UK Government shirk their responsibilities and expect others to pick up the pieces. This is their mess. They should own up to it and fix it.

And as the Labour amendment highlights, UC is not only flawed in policy – it is overly complicated in its application, carries a high risk of administrative errors and is digitally exclusive, disadvantaging many.

In the face of this evidence - from national and local government, third sector organisations, the Church of Scotland and others both north and south of the border – the UK Government is still refusing to pause and fix the system.

So to address the major concerns of debt and crisis, highlighted even by his own MPs, what action has the Secretary of State for Work and Pensions David Gauke taken? He will "refresh guidance so that advance payments are offered up-front".

The very fact of saying even as little as that, is to acknowledge that the minimum 6 week wait creates hardship.

So very little, so very late.

So where he has failed, let's see the PM take action. If she wants to support the 'just about managing' then one clear and simple step she can announce in her conference speech is to halt the roll out of Universal Credit.

Not advance payments – which are loans to be repaid and over timeframes that simply continue the problems - but get her government to fix a broken system that pushes people way beyond "just about managing" and straight into suffering and hardship.

Stop forcing people to make decisions about eating or heating, going to a foodbank, getting a crisis payment, or wondering if they can feed their children and keep a roof over their head.

By its actions – and its failure to act – the UK Government is not only heartless, it is incompetent.

Yes there was widespread support for simplifying an overcomplicated benefits system, but that declined as the cracks in the system were highlighted in the pilot areas and the government refused to take steps to fix them.

As early as 2013 the National Audit Office identified serious weaknesses in DWP handling – citing poor governance, poor management and poor financial control.

In 2014, the Universal Credit pilots highlighted problems with monthly payments and removing direct payments of rent to landlords.

All ignored.

So whilst this Scottish Government will use our very limited powers over how Universal Credit is paid and address this - starting tomorrow for new claimants - it's clear this should have – and could have - been fixed from the start. People want the choice of being able to be paid twice monthly and they want to be able to choose rent being paid direct to their landlord – social or private. This government will make that possible.

And we continue our work on how we address single household payments.

But we have to pay DWP for ensuring that people have these choices. Pay the DWP to do something that is right thing to do and that for years people told them they should fix.

Media reports at the weekend said the main architect of Universal Credit, Iain Duncan Smith, didn't want to hear the bad news about failings of the system. His approach was blinkered and he marched on regardless. But he is only one four Secretaries of State for Work and Pensions since the original white paper on Universal Credit was published in 2011.

Not one of them has been brave enough to pause this shambolic system and take the necessary time to fix the problems inherent in the design and delivery of Universal Credit.

Real leadership comes from listening, paying attention to the evidence and fixing problems.

Real leadership comes from admitting when you have got it wrong - not standing by flawed decisions and forging ahead with the blinkers on.

We need a benefits system that puts meaning behind the principles of dignity and respect, that puts people at its heart.

I urge every member to support the motion and call on the UK Government to act now and immediately halt the roll out of Universal Credit.

Published:
3 Oct 2017
Universal Credit rollout: ministerial statement