Universal Credit (UC) is a single payment which replaces six means-tested benefits and tax credits for working-age individuals and families. It is the UK Government’s flagship welfare reform and has been plagued by problems in its design and delivery. It was designed to lift people out of poverty and smooth the transition into work to ensure that it always pays to be in work. However, the reality is that UC has acted as a vehicle for cuts and caused real hardship for many people.
The National Audit Office recently found that UC may end up costing more than the benefit system it is replacing. It also stated that it cannot be proven that UC helps more claimants into work and concluded it is unlikely to ever deliver value for money.
On 7 January, the UK Government announced it is now considering when to hold the vote on UC managed migration, which would see three million people transfer across to the new system. Before this announcement, the vote had been expected to take place in the coming weeks. While I hope that the UK Government has woken up to the devastating implications of managed migration, UC is deeply flawed and many people are due to move onto it outside of managed migration. The policy is simply not working: it is pushing many families into poverty, rent arrears and to foodbanks.
There was an urgent question in the Commons on Universal Credit on 8th January, you can watch it here.
While UC is a reserved matter for the UK Government, the Scottish Parliament gained some welfare powers under the Scotland Act 2016. Scottish recipients of UC have the option to change the frequency of their payments from once to twice monthly, and for the housing cost element of their UC to be paid directly to their landlord.
UC is not covering basic housing costs for thousands of people. In Scotland, we have the power to make different choices, and my colleagues in the Scottish Parliament have repeatedly called upon the Scottish Government for a £10 million cash injection to the Discretionary Housing Payments that would help protect some of the most vulnerable people in our society.
I believe that the UK Government needs to stop the rollout of UC as a matter of urgency and deliver a social security system that supports people rather than one that pushes many into poverty. I also call on the Scottish Government to urgently use the new powers that the Scottish Parliament has over social security to give us a chance to build a fundamentally fairer society.