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Universal Credit should be a safety net not an obstacle course

by David Scott, CAS policy officer.

This article was first published in the Herald on 28 July 2021.

The welfare state. To many of us, the very name is reassuring, even inspirational. It stands for something that we quietly revere. From the NHS to social housing, regardless of place or circumstance, the welfare state is there for all of us, at any time.

But in reality, for most people, social security is a bit more like home insurance. You pay into it every month through Income Tax or VAT, you know it’s there if the worst were to happen, but you ultimately hope that you’ll never need it.

Covid-19 has changed that for thousands of people. Over the last year, more people than ever before have applied for the main social security benefit - Universal Credit (UC). Currently there are around 490,000 people on UC in Scotland today – nearly twice the figure from February 2020. That’s many thousands of families who are finding out for the first time how strong the social security safety net really is.

At CAS, we wanted to find out how the system held up over the past year and learn from the experiences of people who’ve sought to rely on it in that time. So we commissioned research a few months ago to explore the experience of people who claimed UC during the pandemic.

The research surveyed 601 people who had sought UC advice from Citizens Advice Bureaux between March and December 2020, and then carried out 20 in-depth follow-up interviews to explore in people’s own words how UC had supported them.

This week, we are publishing the data from this survey. And the findings are stark.7 in 10 people found the application process for UC stressful, and more than a third encountered at least one difficulty in completing it. Single parents were more likely to find the application process stressful compared to family households, and people with disabilities were more likely to encounter at least one problem during the application process.

You might think these numbers are to be expected with so many people attempting to access the system for the first time. But our survey also found that even where people had proactively sought out information from the DWP and other sources before speaking to a CAB, they struggled to understand their entitlement. Nearly three in ten respondents found it difficult to get information on their own about applying for UC, and almost one in four said the information they were able to find was unhelpful. 

Can we really say we have an effective social security system when more than a third of applicants experience difficulty applying? Social security is only as effective as it is accessible, and these statistics show a wildly ineffective system.

On the basis of this evidence, CAS has called for a number of changes that would improve the application process for everyone. Some are simple, such as improving the available information the DWP publishes on Universal Credit, to ensure that people looking to exercise their right to social security have a clear, step-by-step understanding of how their entitlement is calculated. Others, like our call to abolish the five-week wait for the first payment by introducing a non-refundable assessment period grant, require more concerted political action from the UK Government.

But there’s another important lesson from our survey. When we asked people why they had ended up applying for Universal Credit in the first place, 59% reported that their employment circumstances had changed since the start of the pandemic. Troublingly, the picture hasn’t improved over time. Of those who reported job losses, 83% identified the pandemic as the reason for this change and over half (53%) were still without a job at the time of the survey (January 2021).

The conclusion we can take from all this is that the impact of the pandemic isn’t over. Businesses and incomes are still reeling from lockdown, with another influx of claims expected when furlough is removed in September.

With this in mind, you have to question why the UK Government just announced a £20 a week cut to UC in October.

We have no idea what the world will look like in three months’ time. There could be another spike in Covid cases, perhaps driven by some new variant, or local lockdowns to cope with the national easing of restrictions. And if furlough is removed at the same time, that’s a recipe for disaster. That’s throwing thousands of people onto a still-recovering job market while simultaneously cutting away at the safety net that supports them.

The bottom line is that people have found it far too difficult to access the support they are entitled to, and this needs to be fixed. UC should be a safety net, not an obstacle course. We want to see the UC application process improved so everyone can safely and confidently access their social security when they need it. And the UK Government must also reverse its decision to cut UC in September and work instead to correct other flaws, such as the five-week wait, that already push people into hardship and debt.

We need to learn lessons from the past year. The problems in the UC system leave individuals and families without an adequate income and struggling to pay their bills. This also has wider societal impacts, as costs are pushed onto other parts of the public sector—onto healthcare, homelessness services, social work teams, and housing providers.

The right to an effective social security system must be a core component of the pandemic recovery. Our hope is that learning lessons from the pandemic will help future-proof the system and ensure accessibility to social security for all.