Universal Credit (UC) represents one of the most considerable changes to the welfare system in Britain in decades. When it was first proposed by the Coalition Government in 2010, UC enjoyed widespread support. But as UC has gone from idea to implementation, this cross-party support has dissipated. Despite welcome improvements in recent years, there have been examples and evidence of significant hardship experienced by some on UC. Mounting hostility and polarisation in attitudes towards UC underlines the need for a balanced assessment of the experiences of different claimants. This report aims to deliver this, along with key policy recommendations for improving UC.
Many claimants are coping with and adapting to UC. There are positive experiences, especially with work coaches. There are also positive attitudes: especially towards the single payment model and conditionality regime.
Nevertheless, the fieldwork presented in this report and the evidence from the wider literature suggests that, despite welcome changes to policy from government, a significant minority of claimants are still struggling with certain unique design features of UC.
Our fieldwork found that older people, those with a physical or mental health problem, the self-employed and the long-term unemployed were the most likely to be consistently struggling with UC's unique design features. Without doubt, the biggest challenges for them are the initial waiting period of at least five weeks and monthly payment in arrears. It was typical for such people in our fieldwork to assert that UC was "confusing", "stressful", "challenging" and "unsettling." The recommendations of this report aim to offer new solutions to support these claimants in particular.
- All new claimants of UC should receive a one-off upfront 'helping hand' payment. Most claimants do not have the financial resources to manage for the initial five-week period without any benefits. Few low-incomes have sufficient savings. This 'helping hand' would be paid as soon as possible after registering on UC. This payment could alleviate the financial impact of the delay for the initial UC award, improve take-up of UC, generate goodwill when a claimant first accesses UC and improve impressions of UC during the critical rollout period.
- Claimant commitments should be rewritten to include obligations of individuals and institutions that support UC claimants. If these obligations are not met, the Independent Case Examiners should determine whether compensation to claimants is paid in their next UC award. If the institutions and individuals supporting UC claimants, for example work coaches, do not meet their obligations outlined in the claimant commitment, there should be consequences, just as there are consequences - specifically sanctions - for claimants who do not meet their obligations.
- Introduce a new mobile phone app for people to access their UC online account. The majority of claimants interviewed for the report liked being able to apply for and manage their UC online. However, many claimants do not have access to a computer at home; recent DWP research found that 31% of current claimants were reliant on a mobile device to access the internet at home. This new app could improve the convenience and functionality of accessing and using an online UC account for all claimants who have online access, but would be particularly beneficial for the significant number without computer access at home.
- Enable claimants, through their online accounts, to grant continuous explicit consent for their advocates and to opt-out and personalise the default frequency and destination of their future UC awards. Claimants should be enabled to opt for fortnightly or monthly payments, and to direct payments to up to three different bank accounts. The different bank accounts could include an alternative current account, a savings account and the bank account of their landlord. This would enable all claimants to arrange for split and managed payments with ease.
- Introduce a live chat facility within online UC accounts. This could enable claimants can have their queries and problems addressed almost anytime and anywhere.
- Cap the number of UC claimants all work coaches can be assigned. The relationship between claimants and their work coaches is integral to the support claimants receive, and to the success of UC. A likely expansion in work coach caseload risks jeopardising the generally positive relationships which have characterised claimants' experiences of UC to date. The cap should reflect the composition and complexity of work coaches' caseloads as well as their size.
- Ensure there is a full-time disability and mental health specialist employment adviser in every Jobcentre Plus. The role of disability specialist employment advisers involves providing training, updating information and working with employers to provide additional opportunity. Due to the significant and positive role that disability specialist employment advisers can play, the report calls for every Jobcentre Plus to have a full-time adviser in place.
- Introduce a disregard for the repayment of UC overpayments where the DWP is responsible for the error. A significant source of overpayment is error by relevant agencies that process UC claims. Overpayments and their subsequent recovery can make it much more difficult for people to effectively budget. The report recommends that overpayments in UC caused by official error should be disregarded up to a certain value.
- An ongoing out-of-work claimant, or claimant that still needs to find further work, should be awarded a supplement on their future UC awards if they are consistently meeting the most demanding conditions around job seeking and preparation set by their work coach. Currently, not fulfilling conditionality requirements results in sanctions. There should be greater rewards, not just sanctions, built into conditionality requirements. This small but significant supplement would reward those claimants who are putting in maximum effort but have been simply unlucky in securing appropriate employment.
- Enter all claimants who are consistently meeting the most demanding conditions around job seeking and preparation set by their work coach into a new biannual UC prize, where a handful of claimants win £1,000. Evidence suggests that the use of 'lotteries' can encourage compliant behaviour. A handful of winners would be announced every six months, each winning a £1,000 prize. Claimants will only be able to receive one prize in their lifetime.
- Extend the 12-month exemption from the Minimum Income Floor (MIF) for self-employed UC claimants, so a further separate 12 months of exemption can be claimed at any point in their lifetime while an individual is on UC, after approval from a claimant's work coach.