Has the £20 Universal Credit uplift extension just kicked the can further down the street?

Has the £20 Universal Credit uplift extension just kicked the can further down the street?

How did we get here?

Last April, in an early attempt to respond to the impact of Covid-19, the Chancellor, Rishi Sunak,  introduced a temporary uplift for Universal Credit claimants of £20 a week. That might not sound like much in the scheme of things, you’d think? Wrong. it’s had such an impact on the families that have received it, that the potential of having it taken away would now be too much to bear. £20 a week means money in utility metres, food on the table, activities for families stuck at home. It’s a life-changing amount of money for families who are only just coping, or already experiencing daily deprivation in their lives.

The temporary extension

To the relief of many charities, campaigners and, of course, UC benefit claimants, the Chancellor announced in his Budget speech last week that the £20 a week uplift introduced last April was to be extended a further 6 months.  To help mitigate the impact of coronavirus on household finances the uplift, which was due to end on 31 March, will now remain in place until September. The Chancellor also confirmed working tax credit claimants would receive equivalent support over the next six months through a one-off payment of £500.

But with the UC uplift extension have we just kicked the can further down the street and will the uplift need to be extended or indeed made permanent beyond September?

Surging unemployment has led to a massive increase in UC claimants

The number of people claiming Universal Credit in the UK has doubled since the start of the pandemic, surging from 3 million in March 2020 to 6 million at the start of this year. Around 446 people were still making new claims every hour in the first week of January 2021, and a total of 4.5 million people have made a claim for the benefit since the start of the public health crisis. The statistics reflect the scale of the hardship caused by Covid-19. This has been laid bare with new figures showing that more than a third of claims since Universal Credit was introduced in April 2013 have been made during the COVID19 pandemic.

Moreover, the number of people on company payrolls has fallen by 726,000 during the same period according to the Office for National Statistics, and the unemployment rate reached a five-year high in December. There is no doubt the £20 uplift has provided a safety net for people that have been made redundant or the self employed who have seen their profits drop due to lockdowns and social distancing measures. This is a very bad state of affairs indeed, that we predict will get worse before it gets better.

Why the £20 uplift proves so vital?

Over 620,000 families with children have started claiming Universal Credit since the start of the pandemic, marking a 51 per cent increase. Two thirds of the families now receiving Universal Credit are single parent families, and around 90 per cent of single parents are women. Analysis by the Joseph Rowntree Foundation (JRF) last year concluded that withdrawing the temporary increase in March risked sweeping 700,000 more people, including 300,000 more children, into poverty.

With the current uplift lifeline in place, Citizens Advice estimated that lockdown debts have already reached £1.6 billion, 2 million households are behind on their energy bills and half a million tenants are behind an average of £730 on their rent. Citizens Advice research showed that the £20 a week uplift equates is the equivalent of 3 days food shopping and almost 7 days of energy costs for many households. With the announcement by Ofgem that energy bills are to rise by £96 to £1,138 a year in April for households on standard or default tariffs combined with the fact we already have higher energy costs due to being confined to our homes and the children having being at home due to schools being shut. Many have already found themselves in a perfect storm of fuel and food poverty due to these factors and the recent cold weather snap.

The loss of the uplift at the end of March would have proved devastating not just for families on Universal Credit and Working Tax Credits, but to the economy as a whole; it was estimated that the uplift alone is pumping £500 million a month into local economies at a time when they find themselves on life support due to many high street shops being closed.

What next for the £20 lifeline?

At this time, it is unclear whether the £20 uplift will be extended beyond September. With the vaccine roll out proving successful so far and infection rates dropping it is hard to gauge what will happen when lockdown ends and how quickly people can get back to work. It is difficult to predict how swiftly the economy can bounce back and if we will see a rise in redundancies again as the furlough or job retention scheme winds down similarly to what we witnessed last year as the rates the government paid to businesses were gradually reduced.

The chair of the All-Party Parliamentary Group on poverty, Kevin Hollinrake, recently recommended that “There is a compelling case for making the uplift permanent.” The Trussell Trust found that before the pandemic struck 70% of Universal Credit claimants had experienced debt during the 5 weeks wait for the initial payment of the benefit. They also found out from their survey that only 8% of respondents said their full Universal Credit payment covered their cost of living and only 5% of people who said they were disabled or had ill-health said their full Universal Credit payment covered their cost of living.

The Government has expressed on multiple occasions that the uplift is ‘temporary’ and impossible to sustain.  We say families livelihoods will be impossible to sustain without it.

Let’s hope social responsibility takes hold before the Autumn.

Team helps IEP members with Universal Credit Webinar

Team helps IEP members with Universal Credit Webinar

We’re so happy with our very first webinar, kindly hosted as a ‘Live Learn Lunch’ by the Institute of Employability Professionals mid December. We chose to talk about the 6 elements of Universal Credit, with an explanation of each element, and then a focus on how changes in circumstances can impact on people’s claims, as well as some obvious references to adjustments associated with the Covid-19 pandemic.

The webinar was formatted as a presentation from myself and Adam, followed by questions and answers. We think it’s so important for the support system to understand this dimension of the benefit, because then they can spot opportunities to help early on, before a problem brews and a claim is affected, so we were really pleased to have a good turn-out but also to have the opportunity for a recording to be viewed by those who weren’t able to attend.

You can see the full webinar here.

Of course there’s a lot of detail we weren’t able to explore during the session, that we cover in a lot more detail in our Get to Grips with Universal Credit online training course, but the webinar did provide participants with some red flags they should look out for so that’s definitely a good start.

Lee Booth, 18th December 2020

Do welfare benefits propel or prevent employment?

Do welfare benefits propel or prevent employment?

Millions more people are now claiming welfare benefits, and it’s probably fair to say that many believed it would never happen to them. So this is probably a good time to start a narrative around whether welfare benefits help or hinder employability.

Like me you’ve probably found it’s not unusual for the two issues of welfare benefits and unemployment to be couched as cause and effect; the implication that benefits ‘prop up’ people’s lives and diminish their motivation to find work. I honestly think this association has now become a lazy stereotype and we need to work together to dispel the myth. Why? Because while it’s out there, perception or otherwise, it carries a lot of weight, and that impacts heavily, not only on the by-standers who have a third party perspective, but also on those who are the main actors of the myth – the people who have been impacted through their self-esteem, and with a belief, perhaps, that they’ll never be taken seriously enough to get a job, because they’re on benefits.

It would be naïve to evade the reality that some people who are capable of working are satisfied not to, and that surviving on welfare benefits might be an option they have chosen (or that has chosen them). It’s also a truth that even in those minority of cases if we dig beyond the surface we can probably also find multiple reasons not to cast blame. But regardless, there’s no doubt we can do a lot better, recognising this connection between welfare benefits and employability as an over-simplification of what is surely one of the most complex and serious challenges for society, and one that’s been getting in the way of social justice for decades.

Unemployment of course is a complicated and multi-dimensional subject – for the unemployed themselves and for the support system at both a micro and a macro level. An important element of this support system is geared to managing welfare benefits claims but this has proven not always to be effective. Despite assumptions to the contrary, benefits are frequently under-claimed (in the millions) because the system is dogged with misinterpretation and/or misunderstanding.

For some people, benefits can hinder the prospect of employability (we explore this below, and the lazy stereotype doesn’t feature …) but more often than not this is a symptom of circumstance rather than an actual desire to be on benefits instead of earning a living. In fact there are many examples of welfare benefits making a positive contribution towards employability.

Welfare benefits actually help people to be employed

 To properly consider how benefits enable people to progress from unemployment to employment we need to evaluate how the welfare state enables millions people to actually be in work already. According to DWP data from July 2020 over 5.5m people were claiming Universal Credit, and about a third of those were reported to already have a job.

 Source: DWP

 The welfare benefits that are enabling employment for millions of people are as diverse as people’s life situations.

The system is designed – in principle – to be accessible for all, geared to fulfilling people’s potential employability on an individual level, rather than stifling it.

Universal Credit, for example, is a means-tested benefit which is geared to supporting low income families, whether they are in work or not. The childcare element of Universal Credit can pay up to 85% of childcare costs if household income is below a minimum threshold, making a huge difference to working families, and ensuring that they are not disincentivised to work through the cost of childcare provision. It would be helpful if families that are concerned about losing childcare benefits by progressing into employment were aware that this help is available, because it’s highly likely that their starting assumption is that it isn’t. The Carers element  of Universal Credit makes work accessible for those who are undertaking caring responsibilities for 35 or more hours a week; this can support someone to continue to work at least part-time, supplementing their wage to make room to look after a disabled family member, for example, and can remove barriers for many working and single parent families.  Helping families to recognise that moving into a caring role does not preclude them from working, and that working part-time can make them better off than leaving employment altogether, is key to avoiding working adults leaving their job altogether when they’re facing these challenges. There’s no doubt that welfare benefits can enable employment for people in this position.

Benefits for working adults also include non means-tested benefits such as Personal Independence Payment (PIP) and government schemes that include Access to Work, both geared to removing personal barriers which can affect employability. At a practical level, this can include anything from access to aids such as a disabled person’s railcard, bus pass, the Motability car scheme, or a blue badge – all significant in improving people’s ability to travel to work. Access to Work enables employers to access special equipment, adaptations or support worker services to help them in the workplace as well as with getting to and from work.

Like Universal Credit and PIP, key to the success of these welfare benefits in enabling employability is the knowledge and support of the wider system – including employers and health professionals. If people become aware that these benefits are available to them as early as possible, and they can be supported to access them, as easily as possible, jobs can be saved through benefits. With the right benefits in place unemployed people will more readily access and retain jobs, avoiding them being unfairly disadvantaged by their need to tackle life challenges while they are working.

The benefits system and the push for employment

It is difficult to imagine how anyone living in crisis, not even sure whether they will soon have a roof over their head, unable to feed their family and coping with domestic chaos, could possibly be motivated and sufficiently confident to look for employment. Yes, a job would lead to a better income that in turn can help to turn around a challenging family situation, but that journey can be long and complex. Welfare benefits, if accessed effectively, can provide for basic needs during these times of crisis, and keep families together and safe.

Our primary challenge, then, is to ensure that once a foundation of security is established, this is quickly converted into a platform for progression, avoiding it transforming into a barrier to employment or a crutch.

Like it or loath it in practice, but the principles of Universal Credit when it was announced by the Conservative party 10 years ago were hard to argue with, cast as fairer for claimants and taxpayers, and designed to avoid the ‘cliff edge’ that was said to ‘trap’ people in unemployment when benefits ended as work started. Although the UC system has been criticised in practice (much of this criticism, in my view, being fair), many have gained employment as a result of the ‘extra push’ it has given. For people who have been assessed as needing to search for employment, Universal Credit payments are made in return for evidence of active job search activities. This can be anything from training, volunteering, or submitting job applications. Evidence of this activity being absent results in sanctions – reduced benefits payments – which have been proven, for some, to focus the mind on looking for work.

The welfare benefits system – including the broader employability support system – has the capability of giving people the ‘third party’ push they need to spur their confidence and help them to actively seek employment. This can be in the form of people pressure, or through the nature of the systems and processes in place, but to be effective it also needs to be person-centred. The support system surrounding welfare benefits that has been set up by DWP included the introduction of Job Centre work coaches. These coaches are intended to build relationships with benefits claimants, and to provide them tangible support to become more active in the job market.

On the ground, the level of service offered is inconsistent, and not everyone is able to recognise the benefit of this support or understand how take best advantage of it. It is therefore important that other players in the support system take an active role in brokering these relationships, ensuring that the claimant recognises the purpose of the work coach’s role in helping them to move forward but also, pragmatically, ensuring that the benefit claimant is clear about what they should expect, so they get all of the support that’s available to them; people need to be educated to expect regular access to relevant training and development, support with CVs and applications, and also to receive practical help with access to grants for travel to interviews and clothing to improve the likelihood of a successful outcome on the day (this can relate to increased confidence as much as making a good first impression to a prospective employer). This is a two-way street.

This role is being played by employability professionals and independent agencies such as Citizens Advice, however this interaction often comes at the point of crisis. More can be done at the outset to avert crisis, and perhaps in some cases it’s not ideal for the paymaster to own this responsibility.

So can welfare benefits actually hinder employability?

We can’t pretend that welfare benefits is the silver bullet that will fix unemployment, but there’s no question that attitudes to benefits need to change. The lazy stereotype image isn’t owned exclusively by the media. People who are claiming benefits feel the stigma. Some worry about whether they should make a claim and decide not to although they will suffer a detriment as a result, ‘just in case’. When applying for jobs, concerns about recruiters discriminating against them because they claim benefits is a real barrier to making the effort to apply in the first place.

People who have been in the position of claiming welfare benefits for long periods can be prone to believing they have become unemployable.

The bias of employers – unconscious or otherwise – can serve to further entrench these barriers – employing someone who is already in employment feels a lot easier and lower risk than employing someone who is long-term unemployed, does it not.

Helping employers to engage unemployed applicants in volunteer programmes to provide work experience, or work trials before a full commitment to a job is made, would make a huge difference, supporting people who feel ‘trapped’ in the benefits system to break down these barriers, and better equipping the employer and the prospective employee to remove prejudices associated with welfare benefits as a hinderance to employability.

If you would like to talk about how you could start breaking down these barriers in your organisation please get in touch; if we can’t help ourselves we’re pretty sure we’ll know someone who can.

A call to action – let’s change attitudes

So, do welfare benefits propel or prevent employment? I usually resist the temptation to talk about culture as it’s a pretty intangible concept in real terms and we can almost exonerate ourselves of responsibility for pretty much anything by blaming culture. But in real terms our attitudes shape the culture that exists around welfare benefits and unemployment, so our call to action today is for us to work together to help those who have found themselves claiming benefits for whatever reason to know that this offers a safe platform for progression back into employment, that the stigma that may have been attached to welfare benefits in the past no longer exists, and that benefits actually enable millions of people to work.

 

Jayne Graham MBE (Director) and Adam Matthews (Social Welfare Instructor) 

Gateshead businesses support local army veterans’ charity to deepen their impact

Gateshead businesses support local army veterans’ charity to deepen their impact

Gateshead businesses support local army veterans’ charity to deepen their impact

Gateshead company Geek Talent has become the first to donate to a new ‘Pay it Forward’ Charity Discount Fund Scheme recently launched by Gateshead social enterprise Society Matters cic.

The Charity Discount Fund was introduced in response to Covid19 and the increased demand on local charities to help people to navigate the complexities of the benefits system. Donations into the scheme are matched by Society Matters, so specialist training in welfare benefits such as Universal Credit and Personal Independence Payments can be accessed by community organisations that simply couldn’t afford it otherwise.

Geek Talent, a Gateshead company that has developed unique software that supports people to improve their chances of employment, commented that they are “delighted to support Society Matters with funding to enable this valuable training at such a critical time. It’s entirely aligned with our own ambitions to make a huge difference to society through helping people out of poverty so they and their families can have a better life”.

The team at Society Matters recognises that businesses often want to support their local community and voluntary sector but often struggle to know how best to help. By donating to the Charity Discount Fund they can add tangible value, helping charity staff and volunteers to be better equipped to deal with the pressure on their services.

Jayne Graham MBE, Executive Director of Society Matters cic, explained “much of the knowledge about welfare benefits in the support system is out of date, leaving staff and volunteers finding it difficult to give the depth of help people need. Training is so critical for the sector, but due to lack of funding it’s simply out of most organisations’ reach. The Charity Discount Fund puts that right, providing a direct route to helping many vulnerable people get the support they need swiftly and more efficiently”.

Through a £500 donation, matched by Society Matters cic, Geek Talent have directly supported staff and volunteers from the military veteran’s charity Walking with the Wounded to build their social welfare knowledge and undergo Society Matter’s vital ‘Get to Grips with Personal Independence Payment’ training.

Members of the Walking with the Wounded team commented that the training means they can now help veterans ‘with more confidence’ and highly recommended the social welfare training, alongside hundreds of others who have now benefited from what Society Matters cic has to offer. Feedback from Walking with the Wounded staff can be found here.

Trading Manager of Society Matters Lee Booth, whose idea it was to launch the fund, praised Geek Talent for their donation saying “We are extremely grateful to Geek Talent for their donation to our Pay it Forward fund and we can already see the positive impact this has had on the staff at Walking with the Wounded. We would encourage any business or member of the public who want aren’t sure how to help charities in the wake of the pandemic to make a donation, no matter how small, and we’ll match it pound for pound.”

If your business would like to make a huge difference in the local community and make a contribution to the ‘Pay it Forward’ Charity Discount Fund please get in touch today.

Your employees need you to Get Business Ready for Universal Credit …

Your employees need you to Get Business Ready for Universal Credit …

The imminent end of furlough for millions of people, and the prospect of reduced work hours meaning many more people will be claiming Universal Credit to top up their earnings means that employers need to Get Business Ready for Universal Credit.

A recent article in The Guardian made us realise that it’s time to launch our Get Business Ready for Universal Credit workshop for employers sooner rather than later. We started developing the short course in response to North East baker Greggs’ experiences earlier this year, when their positive efforts to offer bonuses to staff backfired because the employees who were claiming Universal Credit were impacted negatively, actually losing money rather than gaining from the bonus. Read the article here.

This latest situation reported in The Guardian article explains that a court found that the DWP Universal Credit system unfairly penalised an employee due to the effect of their 4 week payment cycle that didn’t align with the employer’s pay period. As a result of the timing of their pay, a single mother was reported to be losing almost £500 every month from her pay.

This court case is the second in quick succession that has found DWP unlawful in their management of claims, however obviously the time and effort associated with taking a claim to court is way beyond the scope of the majority. That’s not to say we should sit back – there’s constant pressure on the Government to make changes to the way Universal Credit is calculated. However in the meantime we also think to make the system work for employees we also need to ensure that the mist can be cleared for employers, so they really understand the fundamentals of Universal Credit; how it works so they can support their employees with their claims, but as importantly to ensure that their policies and processes (that are within their gift to change) are not inadvertently impacting on staff who need to claim the benefit to top up their earnings.

Free Universal Credit workshop for employers

With literally thousands of employees newly claiming Universal Credit over the past few months, and likely many more to come as businesses make the difficult choice to reduce working hours to keep the business going, this is even more important than ever before. So Society Matters cic is launching its Get Business Ready for Universal Credit workshop with a free course for employers across the North East region to take place on Wednesday 5th August between 4 and 6.30 pm.

We know that money is tight, so we’re offering this first workshop free because we know how important it is for the business community to get this right. Participants will be encouraged to make a donation to our Pay it Forward Charity Discount Fund of whatever they can afford once they have completed the workshop if they think it will make a difference to their business – this donation will enable Society Matters cic to support local community and voluntary sector organisations to access much needed training in Universal Credit and Personal Independence Payments, to improve their own knowledge, and so improve the difference they can make to the people in need that they are supporting every day.

Find out more about the Get Business Ready for Universal Credit workshop here, and click here to get in touch to book your free place* for Wednesday 12th August 4 pm to 6.30 pm.

Will the pandemic help us to get a grip of Universal Credit?

Will the pandemic help us to get a grip of Universal Credit?

Will the pandemic help us to get a grip of Universal Credit?

Nearly a million people awarded UC over just 2 short weeks

It’s hard to believe that nearly a million successfully applied for Universal Credit in the two weeks between 16th and 31st March alone. Coronavirus has triggered a rise of more than 500%, from 60,000 to 371,000 claims a week. The surge in applications dwarfs the impact on the benefit system during the last recession triggered by the 2008 financial crisis. It’s hard to avoid using that over-used word we’re hearing at the moment ‘unprecedented’;  we really have never seen anything like this before!

As a result of this hike in numbers, DWP had no option other than to make the Universal Credit application process easier, with appointments over the phone and a less stringent application process where people are (understandably) not having to attend work-focused interviews with a nominated work coach at the job centre. This change has – temporarily at least – made it less complicated to apply for UC for applicants facing barriers to access (you have to ask yourself why it couldn’t have been made a bit simpler before now) …

The UC claim system has been simplified but still far from simple

 But last week’s statistics published by the Citizens Advice network tell us that the network of charities delivering the Citizens Advice service helped 90,000 people with their UC claims since lockdown started on the 23rd of March. So the process may have been simplified but it’s still definitely not simple. Ok maybe it should never be really easy – the right checks and balances must be put in place when it comes to accessing benefits, but at the moment the system is still really problematic.  So let’s cast our minds forward. What happens when we revert back to the pre-pandemic claim process with more people now losing their jobs through sectors like the hospitality  industry not being able to carry staff financially through the crisis?

We’re in trouble.

Food banks in the Trussell Trust’s network are reporting their busiest time ever, with an 89% increase in emergency food parcels given to people across the UK in April 2020 compared to the same period in 2019.

As the impact of coronavirus continues to unfold, a lot of people facing financial difficulties will be waiting for their first payment of Universal Credit for 5 weeks, and will already have taken the ‘advance payment’ which will cover bills and essentials temporarily. But it’s also recognised that, before the pandemic struck, in every area Universal Credit has been rolled out, food bank usage figures have shown a rise up to to 48%.

UC claimants too often end up in debt

We also need to be aware of the worrying issue of debt for Universal Credit claimants. A recent survey showed that 70% of people fell into debt during the 5 weeks wait for their first payment. Step Change said that since the beginning of lockdown in late March, as many as 1.2 million people had fallen behind on utility bill payments, 820,000 people on council tax, and 590,000 on rent. They also estimated that 4.2 million people had borrowed to make ends meet, mostly by using a credit card, overdraft or a high-cost product such as a payday loan.

People clearly need more financial support whilst they are waiting for their first payment. This is an issue that is going to continue to get worse as more people are losing their jobs and having to claim Universal Credit.

Radical change needed in housing and homelessness for UC claimants 

If we look at the Housing situation in context of the Coronavirus, we have seen some positive measures brought in by the Government. The Eviction ban has just been extended for a further two months and there was a huge drive (the biggest since the second world war) to get the homeless of the streets during the peak of the pandemic.

Many ‘street’ homeless are now on Universal Credit for the first time and are being supported by DWP staff and given the Job Centre as a ‘care of address’ so they can overcome the barrier of not being able to claim the benefit because they aren’t able to provide a permanent address. Again, this is very positive, but this needs to be upheld as restrictions are lifted.

Surely it is morally wrong to protect people and give them accommodation because of the pandemic, but then turf them back onto the streets once it is over?

Let’s hope that doesn’t happen. Local housing authorities face a huge task, and will undoubtedly need support from the Government, charities and the community and voluntary sector to get this right – we need to work together and be absolutely determined to make sure people don’t fall through the cracks at all costs.

This is going to be a challenge. Housing is already a big issue when it comes to Universal Credit.  The Trussell Trust found that housing was the primary problem for 56% of claimants, citing the 5 weeks wait as the reason because people were pushed into rent arrears with either a private or social landlord, making it difficult then to recover. People on Universal Credit have also said they have found themselves being discriminated against by landlords who have lost confidence in the benefit due to late payment of rent or arrears due to complications with Universal Credit. If you’ve looked at local houses for rent adverts recently you’ll see they’re still proclaiming no DSS! This is a vicious circle.

If we’re to get a grip of Universal Credit there’s a lot to do

Coronavirus and lockdown has really made a bad situation significantly worse. More people are now claiming Universal Credit, and have just had to adapt. 

However, now we have an opportunity to get it right and this is our call to the Government and DWP. There’s a lot to say, but if we were only able to make one challenge, it would be:

Please accept that the 5 week wait is simply too long.

Society Matters cic is doing its bit to make its mark, and thousands of charities working hard on the front line are saying the same thing. Let’s stop people losing their homes, getting into debt, reaching crisis point, for the sake of a system that can be changed. Social welfare matters. Society matters. Let’s call to Government to invest what has been learned through the pandemic to get a grip of Universal Credit once and for all.

This window of opportunity may never arise again.

Adam Matthews, Social Welfare Instructor at Society Matters cic

We’d like to know what you think. Please post a comment below.