DAMNING study shows Universal Credit IS to blame for rise in poverty and foodbank use

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National foodbank charity The Trussell Trust have released their latest study on the effect Universal Credit has had foodbank referrals and other poverty factors in the UK. The comprehensive study is damning for the Department for Work and Pensions (DWP) as it shows that the new benefit is directly to blame for the rise in foodbank use. More worryingly it highlights that upcoming “managed migration”, (the process of moving all legacy benefit claimants to Universal Credit), poses a serious risk to the most vulnerable if things don’t change.

Foodbank Use in Universal Credit areas in 2018
Credit – The Trussell Trust

Back in June I wrote how data from the national foodbank charity The Trussell Trust showed that areas that which had Universal Credit for over 12 months saw a 52% rise in foodbank use. This compared with a 13% rise in non Universal Credit areas. Now the charity has released another report but with much more detail.

The latest study titled; “The next stage of Universal Credit” covers what their data has shown since 2016 and their thoughts on how to proceed with the roll-out including “managed migration” in July 2019.

The charity’s chair Emma Revie opens the study with a foreword explaining how the trust have supported claimants and what they want to do going forward. She also highlights some of the issues benefit claimants have been experiencing.

“Foodbanks have seen first-hand the impact on
people when there’s an issue with Universal Credit: families facing eviction, parents skipping meals and people in insecure work struggling to afford the bus fare to work. The five week wait for a first payment, the lack of available support to apply online, the inability of payments to cover the cost of living for people who need it most, and poor administration are just some of the issues people are facing”

There’s an executive summary at the beginning which my friend, and journalist for The Canary Steve Topple highlighted the mainstream press had used for their articles. Steve importantly pointed out while that the executive summary is important, the really important data lies within the rest of the report.

DWP don’t need to waste £217,000 on their own study

Before I go into the important details I think there’s an issue people have forgotten to address. The Department for Work and Pensions (DWP) announced in June that it was going to carry out a year long study “to explore” if there’s any link between Universal Credit and the dramatic rise in foodbank referrals.

I wrote at the time that I thought it was just a ploy to keep the United Nations happy for their November visit to investigate austerity and welfare reforms. As many people have said, we don’t need anymore studies to question IF Universal Credit is to blame, there’s a myriad of them already out there. The one I’m about to address should be the last nail in the coffin.

That £217,000 could be better spent on helping claimants not funding some data analysts and pen pushers. What’s more, as I reported before; The DWP don’t allow Jobcentre staff to keep records of foodbank “signposting,” so they’d be relying on data like the Trussell Trust’s anyway.

Damning evidence that Universal Credit is broken 5 years on

Once you jump into the main part of the report it doesn’t take long to see that Universal Credit is causing a lot of issues. Despite having been in operation since 2013 in various different guises, it is still causing a lot of issues for claimants. Among the issues mentioned are;

  • The 5 week wait for the first payment saw 70% of respondents getting into debt and 57% of them experience new mental health issues.
  • Just 8% said their Universal Credit award covered their costs of living which dropped to 5% for disabled claimants.
  • 63% or respondents were offered no help at all during the 5 week wait.
  • 50% in of claimants in work experienced under or overpayments resulting in more stress on finances.
  • In 2017/18 foodbanks where Universal Credit was in force for over 12 months saw a 52% increase in use compared to a 13% increase for between 2016/17 and 2017/18 for the all Trussell Trust foodbanks in the UK.

Note: The sample size used to attain this data taken from 38 Trussell Trust foodbanks in areas with Universal Credit for over one year.

Reason for delays in benefit payments Credit The Trussell Trust
Reason for benefit delay 2016 – 2018. (Credit – The Trussell Trust)

What’s clear is that the initial 5 week wait for the claimants first payment is causing significant issues. Be it debt, mental health or housing issues, none of these should be happening in a so called welfare system.

Looking at the graph above the situation doesn’t seem to be improving either. While being the lowest reason for benefit delay was; “the waiting period,”it  saw a sharp increase in being the reason for a delay from September 2017 to March 2018. Compare this with the other factors which either fell or leveled off.

Moving to Universal Credit biggest reason for foodbank use

Reason for referral to foodbank 2016 - 2018
Reason for referral to foodbanks: 2016 – 2018 (Credit – Trussell Trust)

The main reason given for foodbank referral by the trust was “benefit change.” As it’s unlikely you’d be moving to a legacy benefit such as Jobseekers Allowance it’s fair to say that the change to Universal Credit will make up much of these figures.

I know this from experience as when I was moved from Employment and Support Allowance (ESA) I became a frequent user of foodbanks. In my case three of the four reasons on this graph were to blame.

  • I was changed to a different benefit: ESA to Universal Credit
  • I had a reduction in my benefit value: I lost my Severe and Enhanced disability premiums.
  • I had to pay back a DWP advance I had taken when wait for for first payment. I was left with £95 a fortnight to pay bills and buy food.

The reports conclusion

The reports conclusion is not good for Esther McVey or the DWP. The trust are concerned that the lack of support available when changing benefits will cause severe issues when the bulk of claimants on old benefits are moved onto Universal Credit next year.

“The Department for Work and Pensions’ plans for the next stage of Universal Credit expects people to manage the move with very little proactive support offered and a credible threat of losing old benefits payments or ‘transitional protection’.”

“During the past two years, there was little evidence of support offered to help people apply, manage their claim or cover their costs financially – and there is little evidence that additional support will be available during the next stage of Universal Credit, despite the problems already seen and the increased vulnerability of many of the people who will be told to reapply to the new system.

“At The Trussell Trust we are therefore deeply concerned that if no changes are made to the Department for Work and Pensions’ plans as they currently stand, more people will be referred to foodbanks following a Universal Credit issue when the next stage of the new benefits system gets underway”

And that, in my opinion is all that is needed to show that Esther McVey’s sham study is no longer needed and that she must take action now to alleviate the strain on foodbanks. Failure to do so  will show a lack of care for claimants health and well-being. With some suggesting it may make the Work and Pensions Secretary complicit in crimes against claimants.

I still believe that Universal Credit needs to be scrapped. While some people may not agree with me I just can’t see how this system can be salvaged. The combining of sickness with in work benefits is designed to push people into work whether they fit or not.

That is why I call for it to be scrapped and replaced with a system that puts the ‘wel’ back into ‘welfare.

Final word from head of The Trussell Trust

Chief Executive of The Trussell Trust Emma Revie
Chief Executive of The Trussell Trust Emma Revie (Credit – The Trussell Trust Blog)

I reached out to the Chief Executive of The Trussell Trust; Emma Revie to ask her for a comment in light of this report and she got back to me with these answers.

Do you think in light of this damning report that the DWP will make changes?

“We are waiting for the Social Security Advisory Committee to respond, and the DWP will respond soon after – we’re really hoping our evidence can help the Department design a better system for moving people over to make sure no-one needs a foodbank in the process.”

Do you think that the government’s own £217k study will tally up with your data?

“The Trussell Trust and others in academia and the sector have produced lots of robust, publicly available information on foodbank use and poverty in the UK and we hope the Department takes this data as a starting point for their investigation.”

What do you think needs to change immediately to ease the burden on foodbanks and claimants?

“Making sure vulnerable people don’t fall through the net and have an income that covers their cost of living is essential – that means strengthening the public services that we rely on, like the benefits system, and making sure payments, whether through work or benefits, cover costs.”

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