Social Justice

Universal credit switchover risks pushing people into 'destitution', charities warn

From this week letters will give claimants a deadline to apply for universal credit - and the DWP will be able to stop their existing benefits if they do not apply in time.

universal credit debt advice

The universal credit cut risks driving more people into debt according to StepChange. Image: Unsplash / Charles Deluvio

Leading charities have condemned the government’s decision to restart moving 2.6 million people off legacy benefits and onto universal credit, saying it risks pushing claimants into “destitution”.

Organisations are calling for the switch, which has been branded a “stealth-cut”, to be stopped altogether, with concerns it could leave some vulnerable people “unable to pay their bills”.

From this week, letters are being sent to claimants with a deadline, typically of three months, to apply for universal credit – and the Department for Work and Pensions (DWP) will be able to stop their existing benefits if they do not apply by the deadline.

More than 20 charities have written to work and pensions secretary Thérèse Coffey urging her to stop the rollout unless the government can ensure nobody’s income will be cut off if they do not respond in time.

The managed migration scheme was originally put on hold due to the pandemic, and those on working tax credits will be targeted first, sparking fears among the 1.7 million claimants – most of whom are disabled or long-term sick – that they will be pushed into hardship. The DWP is aiming to have everyone transferred by the end of 2024.

The charities include Mind, The Trussell Trust, Shelter and Disability Rights UK, who state that as many as 2.6 million people could eventually be affected.

They say the entire process risks pushing 700,000 people with mental health problems, learning disabilities and dementia into poverty, with “devastating and life-threatening” consequences.

In the letter, the groups wrote: “We believe that your approach for moving people receiving older benefits on to universal credit risks pushing many of them into destitution.

“We ask you to consider the devastating consequences for someone who faces challenges in engaging with the process having their only income cut off, especially during this cost-of-living crisis. No one subject to managed migration should have their existing benefit stopped until they have established a claim to universal credit. Instead of setting arbitrary deadlines, the DWP needs to take responsibility for ensuring people’s safety.”

Paul Farmer, chief executive of the mental health charity Mind, said: “Those too unwell to engage with the DWP could be left unable to pay their rent, buy food or pay their rising energy bills.

“The DWP should halt this process.”

In a tweet, the Z2K anti-poverty charity said: “We have huge concerns that many people will lose much-needed income, not have the support needed to manage their claim and ultimately be worse off. Now, more than ever, people need support. The government must pause and ensure crucial safeguards are in place.”

Child Poverty Action Group CEO Alison Garnham, said: “The stakes are very high with managed migration because people who can’t get their universal credit claim established can lose all of their benefit. The scheme should not be going ahead until it’s been properly trialled in a gradual way and the results scrutinised by Parliament. We really shouldn’t be asking claimants to carry the risk of moving over to universal credit.”

Overall, the Department of Work and Pensions estimates claimants on legacy benefits are missing out on up to £4 billion a year.

A DWP spokesperson said: “Over five million people are already supported by Universal Credit. We know work is the best route out of poverty and Universal Credit is a dynamic system which adjusts as people’s earnings change, is more generous overall than the old benefits, and simplifies our safety net for those who cannot work.

“Roughly 1.4 million people on legacy benefits would be an average of around £220 a month better off on Universal Credit, with top up payments available for eligible claimants whose Universal Credit entitlement is less.”

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