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Universal Credit is designed to provide financial support to Britons who are either out of work or on a low income. The DWP has put a number of processes in place, which it states are designed to help claimants as much as possible. However, MPs have suggested more could potentially be done to alter the Universal Credit system and assist those who need help most.
The Work and Pensions Committee published a report entitled ‘Universal Credit: the wait for a first payment’ in which it laid out recommendations for significant change to the welfare system as it stands.
One major change put forward is the establishment of a new starter payment to ensure people have enough money to live on while going through the five-week wait period.
MPs highlighted that after its call for evidence, some form of non-repayable initial payment to new claimants awaiting Universal Credit emerged as a popular option.
A one off “helping hand” could potentially alleviate the financial impact of the delay for the initial Universal Credit payment, but could also improve the take-up of the benefit.
Within the report, MPs also made a case for the COVID-19 related financial boost to Universal Credit, worth just over £1,000 a year, to be retained.
At present, the government has said the measure will be removed in April 2021, but many groups have similarly called for a permanent increase.
For those switching onto Universal Credit from other benefits, such as Employment and Support Allowance or Income Support, rules introduced this year mean Britons will continue to receive their benefits while they wait – but for two weeks.
MPs raised issues with the run-on payment, with the report stating: “That is a sticking plaster, which costs public money, leaves claimants with a gap between payments, and unnecessarily disrupts their budgeting schedules.”
Instead, the report outlined, claimants should continue to receive their existing benefits throughout the first monthly assessment period.
This would eliminate any gap before receiving the first and subsequent Universal Credit payments.
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Another issue highlighted within the report was the matter of Alternative Payment Arrangements – designated for those who are at risk of “financial harm” and who cannot manage a single monthly payment.
Under this kind of arrangement, Britons could have funds redirected straight to their landlord, or payments made more frequently than the standard once a month.
However, for MPs, not enough is currently being done to bring awareness to these options, and the report called for “new and clearer guidance” on the matter.
In addition, the option of APAs, the committee said, should be extended to all claimants in England and Wales.
A final issue raised by the report was the ability to backdate a Universal Credit claim.
Committee members also called for further awareness to be brought to this issue, as many people are unaware the claim can be backdated by a month.
The report added: “Even when they do ask for backdating, they sometimes face an intrusive and bureaucratic process.”
But MPs also described the length of current backdating as “astonishingly short” and called for the period to be extended for those with extenuating circumstances, such as a bereavement, serious illness or relationship breakdown.
The report also highlighted that the COVID-19 pandemic had placed the Universal Credit system under “unprecedented strain”.
However, it did acknowledge the automated system was a benefit, as a manual system, the report claimed, would not cope with millions of new claims in such as short space of time.
Despite this, such processes, it highlighted could also be a weakness.
It stated: “An automated process cannot be tailored to the specific circumstances of individuals whose needs may be more complex.
“In making recommendations in this report, we have aimed to balance the need for Universal Credit to be more flexible to meet the varying needs of new claimants, while maintaining, as far as possible, the benefits that automation brings.”
The report went on to conclude that the five-week wait period was “inevitable” due to the fixed monthly assessment period.
While it acknowledged it would be difficult to remove the wait for claimants without radically altering the system, it did call for further action from the government in mitigating the effects.
The report finished by stating the recommendations it put forward would together provide “vital support” for claimants who need it most.
If such recommendations went on to be implemented by the DWP, it could result in monumental changes for Universal Credit claimants.
Express.co.uk contacted the DWP for comment on the report, and a spokesperson said: “With Universal Credit, no one has to wait five weeks to be paid, as urgent advances are available – since the start of the pandemic more than two million payments have been made to new claimants within days of being requested.
“We have provided £9.3 billion extra welfare support to help those most in need, including up to two-weeks of legacy benefits for those moving to Universal Credit, and have taken steps to ease the burden of debt repayments.”
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