Monday, October 09, 2017
Rethink needed on universal credit
It is not often I agree with John Major, but on universal credit he is bang on the money. He has described the Tories' flagship welfare reform as “operationally messy, socially unfair and unforgiving”. Universal Credit combines six working age benefits into a single payment, it is one of those Government schemes that seemed like a good idea at the time but which has proved immensely difficult to implement and full of unintended consequences.
It is little wonder that more than a dozen Tory MPs have urged ministers to pause the roll-out of the policy amid concerns that claimants could face delays in receiving money, whilst Dame Louise Casey, the ex-head of the government's troubled families team, has warned the benefit is like "jumping over a cliff" for people with no spare money.
As the Daily Mirror says, Government figures show 23% of new claimants do not receive their first full payment within six weeks. As a result many claimants will go into rent arrears and build up other debts.
A study, carried out for the Department for Work and Pensions reveals that among Universal Credit claimants who pay rent, 41% are in arrears, with 82% saying it is for the first time. It also reveals that large numbers are forced to borrow, with 7% turning to doorstep lenders and 5% taking payday loans, almost 30% rely on a loan from family and friends.
And here I am agreeing with John Major again. He says: "We must persuade the Treasury that - while the cost of long-term borrowing is low - there is an opportunity to vastly accelerate public development of infrastructure and, in particular, housing.
"Useful initiatives have been announced but we need to go further. if this increases public debt we should - and could - accept that (as I believe the markets will) provided annual revenue expenditure is kept under control."
It is time for a change of direction, but why is a former Tory Prime Minister leading the charge rather than the opposition Labour Party?
It is little wonder that more than a dozen Tory MPs have urged ministers to pause the roll-out of the policy amid concerns that claimants could face delays in receiving money, whilst Dame Louise Casey, the ex-head of the government's troubled families team, has warned the benefit is like "jumping over a cliff" for people with no spare money.
As the Daily Mirror says, Government figures show 23% of new claimants do not receive their first full payment within six weeks. As a result many claimants will go into rent arrears and build up other debts.
A study, carried out for the Department for Work and Pensions reveals that among Universal Credit claimants who pay rent, 41% are in arrears, with 82% saying it is for the first time. It also reveals that large numbers are forced to borrow, with 7% turning to doorstep lenders and 5% taking payday loans, almost 30% rely on a loan from family and friends.
And here I am agreeing with John Major again. He says: "We must persuade the Treasury that - while the cost of long-term borrowing is low - there is an opportunity to vastly accelerate public development of infrastructure and, in particular, housing.
"Useful initiatives have been announced but we need to go further. if this increases public debt we should - and could - accept that (as I believe the markets will) provided annual revenue expenditure is kept under control."
It is time for a change of direction, but why is a former Tory Prime Minister leading the charge rather than the opposition Labour Party?
