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Universal Credit - Too Important an Opportunity to Miss

Posted: 03/05/2013 00:00

Iain Duncan Smith

The introduction of Universal Credit, the government's new benefit system, is a once-in-a-generation opportunity to simplify welfare and make work pay.

Its first trial period began this week (29 April) in a small area in the North West and will continue over the summer. But the fact that families with children are not being targeted during its testing phase is of great concern. Initially only a very small number of households in a limited area of the country will be affected.

By the time it is fully implemented in 2017, the new benefit system will affect nearly seven million children - about half of all children in the UK. By not including families with children now, any problems they may experience will not be identified before it begins to be rolled-out across the country from October.

Welfare reform on this scale will have a significant effect on these families, both as a result of changes to entitlement and to how it will be administered.

Entitlement changes include reductions in personal allowances for single parents under-25 and cuts to help for many disabled children. Changes to the way it is administered and the frequency of benefit payments and claiming online are also cause for concern.

Where under-25s are concerned, the current welfare system provides the same support to single parents aged under-25, as those over 25. But under Universal Credit this will change. Single parents under-25 will instead receive less than single parents who are older - up to £15 a week less than under the current system.

Changes to support for disabled people will also make a significant difference to large numbers of families, as the amount many disabled children receive* will be substantially reduced. The maximum rate will be cut by £28 a week, making it very difficult for many families with disabled children to pay for such crucial essentials such as childcare, heating and travel.

This will be compounded by the abolition of the Severe Disability Premium, which will affect 25,000 disabled lone parents and about 42,000 children. And will cut about £50million a year from support for young carers who are caring for a disabled parent.

We are also concerned by the implications of shifting to claiming online and to changing the frequency of payments. Many of the most vulnerable claimants may not be able to use the internet, or do not have the means to do so. And many may struggle to manage their money effectively on a monthly basis because they have not previously been expected to budget in this way. Neither issue has been sufficiently addressed.

Although the government is right to focus on work as a route out of poverty, by cutting vital support, it is jeopardising children's chances of a better life.

It is important, particularly as families and children form the largest groups that will be affected by Universal Credit's introduction, that the government uses the pilots to identify and address any harmful effects they may experience.

These reforms must not become a lost opportunity. Although many families will clearly benefit, others, including huge swathes of those most in need, will lose out, undermining the new system's effectiveness.

It is critical that this new system is fair and that none of its measures plunge even more children into poverty.

To find out more, see The Children's Society's Universal Credit concerns

*All disabled children in families receiving Universal Credit will be affected if they are on some level of Disability Living Allowance, other than those on the high rate care component of Disability Living Allowance or those who are severely visually impaired.

 

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