You are viewing 1 of your 1 free articles
Alison ButlerUniversal Credit: councils face deeper debt with this badly planned policy
Croydon Council has been dealing with the government’s much-maligned Universal Credit scheme since 2015. Here, the council’s deputy leader Alison Butler calls for a rethink on this “mess” of a policy
Being the chancellor of the exchequer can’t be much fun at this time of year. With the Budget just days away, the chancellor seems, quite rightly, to face new pleas for cash at every turn – the NHS, ending austerity, Universal Credit.
The plea to put Universal Credit right isn’t new.
Thanks to recent high-profile interventions from former prime ministers Gordon Brown and Sir John Major, the national media is now fully focused on a fact we’ve known here in Croydon for years – Universal Credit is a mess.
Croydon was one of the first councils unlucky enough to be chosen by the government as a Universal Credit full roll-out area in 2015.
This led to struggling families getting into more housing debt, facing eviction by their private landlords and not having enough money to get by.
Croydon Council built on Gateway, our early intervention welfare service, which has prevented homelessness by giving struggling residents one-on-one budgeting support and skills training from its own dedicated enablement and welfare advisors.
READ MORE
The numbers speak for themselves. In 2017/18 alone, we have helped more than 2,400 of Croydon’s most severely affected families avoid homelessness, given 14,900 people budgeting support, improved the digital skills of 4,700 people and reduced the number of people presenting as homeless by 15%.
Since Universal Credit was introduced to our borough, we have come up with other innovative plans to help some of our most vulnerable families from slipping further into debt and rent arrears.
We created our own social lettings agency, where the council acts as a managing agent to match tenants at risk of homelessness with landlords. Initially we matched 20 tenants with 12 landlords, and both get the security of a long-term arrangement that reduces the chance of evictions and the need for emergency council-run accommodation.
The council has also joined forces with around 30 community organisations to launch London’s first joint welfare and food club called The Food Stop, and we have plans to launch several more of these in the next year.
Just as councils new to Universal Credit will have to adapt, so we are making a good fist of this bad policy in Croydon.
But the bottom line is there is not enough money or support from the government. For example, we had to again write to the Department for Work and Pensions (DWP) this month because it still owes us more than £1m in unpaid housing benefit subsidy from when Universal Credit was launched here. That does not bode well for other councils about to take the plunge.
“The bottom line is there is not enough money or support from the government.”
Moreover, we are having to dip into our own stretched resources because the DWP has woefully underfunded Universal Credit in Croydon.
Last year, Croydon had to spend almost £1m of council money to top up the inadequate funding we received in discretionary housing payments from the DWP. This year, we will have to add another £700,000.
This money goes to help some of Croydon’s most vulnerable people, but it would not be necessary if the government funded us properly in the first place. It is not right that Croydon’s taxpayers are having to foot the bill for failed government policies.
Recently the DWP stopped giving councils like Croydon a share of its universal support funding that previously went to both local authorities and Citizens Advice working together to help benefit claimants.
This unilateral decision shows the DWP does not grasp the complex partnerships that work at a local level to limit the damage caused by Universal Credit.
The painful lesson we have learned in Croydon is that Universal Credit can have an immediate, devastating effect that requires action now.
So, what should the chancellor do?
The fact remains that Universal Credit needs rethinking or scrapping entirely.
As the latter is unlikely, the chancellor must properly fund this badly planned policy or risk sending not just struggling families into deeper debt but councils too.
Pumping money into Universal Credit might not be the most eye-catching announcement the chancellor could make, but it would probably be the most important.
Alison Butler, Croydon Council’s deputy leader and cabinet member for Homes and Gateway services
