Reaction to Universal Credit changes announced in the Budget

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Paul Shamplina, Founder of Landlord Action, reacts to changes to Universal Credit scheme announced in the Autumn Budget yesterday.

“The Government appears to have bowed to the volume of criticism levelled at its flagship Universal Credit scheme and a realisation there is a range of fundamental issues which need to be urgently addressed. Mounting evidence pointed to the fact significant hardship was being experienced by claimants due to, amongst other things,having to wait up to 6 weeks before the first payment.

“Changes announced yesterday by the Chancellor, included removing the 7 day waiting period, before eligibility commences; access to a full months’ advance (loan), instead of current 50%, payable within five days of applying; extending the repayment period for advances from six to 12 months, will undoubtedly help ease concerns. The Chancellor also announced that new housing benefit claimants could continue to receive it for an extra two weeks, while waiting for their universal credit payments to start. This news will be warmly welcomed by tenants and landlords alike and should help reduce rent arrears at the point of transfer to Universal Credit.

“However, I do still have a number of concerns. The reduction in the waiting period by seven days doesn’t apply to the vast majority of claimants anyway, so this will only help the minority. Of greater issue is the increasing complexity of the scheme; staff assessing Universal Credit claims have not been properly trained, meaning mistakes are being made on an all too regular basis; and as the Full Service rollout expands, more complicated cases will arise, causing even more challenges for DWP staff. Some experienced commentators have suggested the changes, whilst welcomed, represent “sticking a plaster” to a fatally flawed system which requires re-engineering, rather than tinkering and have grave doubts concerning DWP’s ability and willingness to alter the direction of travel. Until the system has proved itself “fit for purpose”, landlords will remain cautious about renting to those in receipt of Universal Credit for fear of unsustainable levels of rent arrears.”

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