Cross-party coalition of MPs call for reforms to Universal Credit in wake of Covid pandemic

The All-Party Parliamentary Group (APPG) on Universal Credit, led by MP Debbie Abrahams, is calling on the government to provide enhanced support for Universal Credit (UC) claimants and to fix the longer term, structural issues with the UC system following a series of mini inquiries.

Since May, the cross-party group of MPs from across the country, together with members of the House of Lords, have held meetings on three topics: the coronavirus, mental health and housing.

A number of the temporary measures the government put in place to bolster social security in the wake of the pandemic, such as the suspension of financial sanctions and the requirement to meet job coaches, have been favourably received by charities and claimants a like. As the economic consequences of the coronavirus continue, many would like to see these policies continue to support claimants through recovery. These include:

• Maintaining the £20 per week uplift to Universal Standard Allowance permanently. A number of speakers noted that even prior to coronavirus many Universal Credit claimants were struggling to get by and stay on top of bills, after years of welfare cuts and freezes. Maintaining this increase will be a lifeline to families trying to get back on their feet and will help stop many getting into a spiral of debt.
• Keeping the temporarily increased Local Housing Allowance (LHA) rates.  The APPG would like to see this maintained at 30% of market rents be made permanent to prevent families facing the risk of homelessness. During the session on UC and housing, the APPG heard calls from some organisations to increase the LHA even further – up to the 50^th percentile of average rents.
• Maintaining the ban on financial sanctions. As our economy slowly recovers, the APPG believe the social security system needs to adapt to the new reality of a changed labour market where less opportunities may be available and is calling for work coaches to apply greater flexibility regarding conditionality.

Debbie Abrahams, Chair of the APPG on Universal Credit, said:

 “The coronavirus pandemic saw a huge and sudden increase in claimants. As the Furlough Scheme comes to an end in the next few weeks, this is likely to increase even further. It is more important than ever that we make sure that Universal Credit is better able to meet the needs of claimants and provide the timely financial support they need while they work to get another job or start a business.

“Becoming an UC claimant should not be associated with debt, poverty, homelessness or ill. But for too many it is. Our social security system is not fit for purpose, it is not the safety net that it’s meant to be.

“Evidence from charities, claimants, and academics have come together to develop pragmatic policies to improve Universal Credit. People need to get the help they need; when they need it.”

Thomas Lawson, CEO at Turn2us, said:

“It is great to see politicians from across the spectrum come together to work on practical steps to improve Universal Credit for the people that need it.

“We see the frontline reality of poverty every day, people are struggling to put food on the table and pay their bills. Universal Credit should support people to thrive, not barely get by.

“Universal Credit has the potential to become part of a social security safety net we can all be proud of, but the DWP must be brave and ambitious enough to acknowledge its failings and fix it quickly.”

-ENDS-

BACKGROUND FOR EDITORS

The APPG heard from speakers who raised long-standing issues with Universal Credit which have been exacerbated by the pandemic or undermined measures to support people during this difficult time:

• Speakers repeatedly highlighted how the Benefits Cap was eroding the support people needed. It has also meant many families have not seen the some or all of the benefit of the £20 increase to Standard Allowance as this has meant they have been capped and their entitlement restricted. Child poverty charity CPAG estimated in May that capped families had risen by at least 50% with at least 12,500 families capped due to the Standard Allowance increase.
• The five week wait for Universal Credit is still a significant and consistent problem raised by experts. Many claimants are near automatically thrown into debt, rent arrears or serious financial hardship by this gap in support. The government must find a way to solve this problem permanently that doesn’t involve increasing debts of claimants.
• Support for people with mental health issues needs to be significantly improved. Many aspects of the system itself are leading to claimants to experience poor mental health. The APPG heard from Dr Sophie Wickham whose recent Lancet article detailed how the introduction of Universal Credit led to an additional 64,000 unemployed people experiencing psychological distress between 2013 and 2018.

The current APPG Officers are:

• Debbie Abrahams MP – Chair (Labour)
• Jonathan Gullis MP – Secretary (Conservative)
• Chris Bryant MP –Treasurer (Labour)
• Annie McLaughlin MP – Vice Chair (SNP)
• Peter Aldous MP – Vice Chair (Conservative)