Thank you for contacting me about Universal Credit.
Universal Credit is a major reform that will transform the welfare state in Britain. At the heart of Universal Credit is a belief that work should always pay. Under the new system, benefit will be withdrawn gradually as claimants start work or increase their earnings, meaning their total income always goes up.
Rightly for a programme of this scale, the priority continues to be its safe and secure delivery. The controlled expansion of Universal Credit started in April 2013 and I am pleased that significant progress has been made to date. Universal Credit is now available for single claimants in every jobcentre in the country. However the Government is deliberately taking its time in the roll-out – it will have been 9 years before this programme is rolled out in full – and at every step the Government is adopting a process of “test, learn and rectify”. The Agile system is responsive and where issues are identified these are addressed. For example timeliness of payments is consistently improving, a new landlord portal has been designed to reduce rent and housing benefit issues and nearly 50 per cent of new claimants are awarded advances – often immediately or within a week of application - to help them into the system.
Figures have shown that people claiming Universal Credit are more likely to be in work than people claiming Jobseeker's Allowance, earning more money and being placed in a better position to take a job. One of the best aspects of UC is that the benefit is designed to be flexible every month depending on work received. This is a huge improvement on the past when if someone on benefits wanted to work for more than 16 hours a week this could result in a huge “cliff edge” with them losing support. This prevented some from entering the job market and even more so from progressing within it.
The “taper rate“ has also been reduced since April of this year to help people to keep more of the money they earn – this is a nearly £2bn investment in those in work and on UC which I welcome. Under Universal Credit, support worth up to 85 per cent of childcare costs is now available regardless of hours worked, significantly higher than the support that was available under tax credits. This will give parents more flexibility to work and earn more money.
I served on the DWP Select Committee when we looked into the in-work progression benefits of UC. This (cross-party) report concluded, among other points that Universal Credit has,
“the potential to be the most significant welfare reform since 1948… It promises to break the cycle of people stuck in low pay, low prospects employment.”
All that is not to say that the system is perfect. Of course, there will be issues, some heartrending, that need to be resolved.
However, that, sadly, is true of every benefits system, and certainly true of the predecessor that universal credit replaces. The difference is that universal credit, as well as being right in principle, is proving to be adaptable and responsive.
I hope this explains why I strongly support this important reform. Thank you again for taking the time to contact me.
