'Nothing to gain' with new benefit
Published 07/05/2013 | 00:16
Most families will gain nothing from the Government's new Universal Credit , with ministers overstating the generosity of the benefit, a new report has claimed.
The TUC and Child Poverty Action Group said the new single benefit payment, now being trialled in parts of the country before being introduced across the UK, was in danger of failing to deliver on its key objectives.
The two groups said that although Universal Credit will improve some aspects of the benefits system, its ability to lift families out of poverty and remove barriers to working will be "severely undermined" by the Government's wider tax credit and benefit changes.
Nine out of 10 families will gain nothing overall from its introduction, with any benefits offset by recent social security cuts, it was claimed.
Requiring people to claim online and make joint claims with their partners will make the process more complicated at a time when advice services are being cut, said the report.
TUC general secretary Frances O'Grady said: "Universal Credit is not bad in principle, but taken together with the other benefit changes introduced by the Government, it will make most people worse off. For all the claims of simplicity, in practice it is such a complex system that the Government has been forced to delay its roll-out."
Child Poverty Action Group chief executive Alison Garnham said: "Universal Credit seeks to address many of the shortcomings of the current benefits system by being simpler and providing incentives for claimants to earn more.
"But Universal Credit lets itself down on many fronts. It introduces new complexities into the benefits system such as joint payments and new rules on savings. In addition, the financial gains for many are underwhelming, and the new system will rely as much on the stick as the carrot to incentivise claimants into work.
"Universal Credit is also blind to conditions outside of the benefits system: a lack of suitable jobs, the high costs of housing, and expensive childcare to name a few. Taken in isolation, Universal Credit may increase some households' incomes, but what financial gains they receive are more than wiped out as a result of the Government's broader programme of cuts."
Citizens Advice chief executive Gillian Guy commented: "We support a simplified benefits system which makes it clear that work pays and provides an essential safety net but the success of Universal Credit will be in its implementation. We are keeping a watchful eye to make sure it truly delivers on its promises and will sound the alarm bell if CABs across the country identify problems."