Warnings that Universal Credit is veering off track
A think tank has warned that the government’s flagship benefit reform has ‘serious design flaws’ and has ‘veered off track’ because of cost-cutting.
According to the Resolution Foundation, Universal Credit could leave 2.5 million families worse off, with some by more than £3,000 a year.
The warning comes as the government announced a further expansion of the scheme.
Stephen Crabb, Welfare Secretary, said the benefit payment was ‘transforming welfare’ and getting people into work faster.
Universal Credit aims to provide incentives for people to move off benefits and get into work. They have replaced six current benefits, including Jobseekers Allowance and Employment and Support Allowance with a single payment.
The benefit is gradually being rolled out across the country and is now available to new single jobseekers in every job centre across the UK.
A full roll-out is targeted for 2021.
The Resolution Foundation stated that they have always been supportive of Universal Credit, which it said would simplify welfare and boost work incentives.
However, they felt recent changes, “which have been driven by the government’s desire to secure further savings in the welfare budget” have taken it too far from its original purpose.
The foundation believes that unless design flaws are eradicated, Universal Credit risks being reduced to a complicated vehicle for cutting the benefits bill and urged Crabb to ‘reclaim’ the reform from the Treasury.
The report stated that while some of the current system’s ‘disincentives’ to return to work had been removed by the form, the opposite was true for many families, particularly second earners in couples.
The government said that more than 450,000 claims had been made for Universal Credit so far, which equates to more than 9,500 new claims made every week.
Mr Crabb said: ‘Universal Credit is transforming welfare and is central to our vision for our society where people of all backgrounds can earn a decent wage and provide for their families, with claimants moving into work faster and earning more than under the old system.
"Our focus now is on continuing its expansion to all claimants."
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