Iain Duncan Smith must urgently confirm how he will help the overwhelming majority “not ready for Universal Credit”
Citizens Advice Chief Executive, Gillian Guy, has called on Iain Duncan Smith to use his appearance before a parliamentary committee today (Wednesday) to confirm how he will help the 9 out of 10 people who are not ready for Universal Credit.
Following publication of a new study by the national charity, Gillian Guy said:
“Today Iain Duncan Smith must urgently confirm how he will support the nine out of ten people out of over 1,700 Citizens Advice clients we spoke to, who say they will not be able to cope with Universal Credit when it is introduced in just a few months time.
“There is clearly a big problem if 90% of these potential claimants won’t be able to deal with this major change to their payments, and the Select Committee must today press ministers to act urgently and address this.
“An overwhelming majority of our clients surveyed said they will struggle to budget with monthly rather than weekly payments. We have not seen evidence to back up Government’s claim that paying claimants once a month will prepare them for work. Giving people the option of fortnightly payments and support on budgeting would really help them to avoid falling behind on bills or sliding into debt.
“Half of the clients we spoke to in our bureaux do not feel able to use the banking services needed to deal with Universal Credit payments, and many don’t even have access to basic banking services. Without a commitment from banks that they will give everyone access to basic accounts, many people will simply not be able to deal with direct payments.
“We fully support attempts to simplify welfare, but delivering Universal Credit will be immensely complicated. We have expressed concerns for some time that Government has not been clear about what support will be provided to help claimants, or quick enough to put this in place. Our study proves that there is an urgent need for strong support to make sure people can cope with such significant upheaval in the benefit system.”
The new figures, released this week by the national charity, should worry the Welfare Secretary as the Coalition prepares to introduce Universal Credit nationwide in October.
Ministers will be particularly concerned that three quarters of anticipated Universal Credit recipients do not feel they would be able to budget adequately, or manage the shift to monthly rather than weekly benefit payments.
Citizens Advice surveyed over 1,700 of its clients who will start to receive Universal Credit from October and asked them whether they felt they would be able to cope with five possible problem areas – budgeting, monthly payments, banking, staying informed and internet access.
Ninety-two per cent of future Universal Credit recipients said they felt unprepared for the new system in at least one area.
|Area of concern|
Criteria for ‘UC not ready’
(scores 1-3 on a scale of 5 indicate client is not ready)
|% clients not ready|
I am able to keep track of my money on a monthly basis.
(1) does not know how much money going in or out per month;
(2) finds it hard to keep track of money in and out;
(3) rough idea of monthly household spend, but needs support.
73% ‘not ready’ for UC
I/we can manage changes in the money I receive
(1) often runs out of money and does not know what to do;
(2) often ends up borrowing money to cover living expenses; or
(3) has tried different things but does not feel they can make real changes.
77% ‘not ready’ for UC
I use an account to pay priority bills on time
(1) not sure what priority bills are and/or the type of account needed for Universal Credit;
(2) have the right account, but do not know how to prioritise or pay their bills;
(3) understand how to pay bills, but not sure what to do if they do not have enough money to pay the costs.
52% ‘not ready’ for UC
I get the help I need and can keep up to date
(1) do not know about the universal credit changes;
(2) have had some information, but unsure what it means to them; or
(3) understand the universal credit changes, but not sure what to do next.
81% ‘not ready’ for UC
I can get online to manage a UC account
1) do not know how to get online and manage their benefits claim online;
(2) have received information of how to get online but need support;
(3) know how to get online, but need support
66% ‘not ready’ for UC
Citizens Advice has called on Government to make it easier for people affected by Universal Credit to request fortnightly rather than monthly benefit payments, and for recipients to request that their rent continues to be paid directly to their landlord for the first year of the new system. The national charity also wants banks to offer accounts which meet a basic set of standards to ensure that recipients can pay their bills.
This is the first independent piece of research which investigates the likely impact of implementing Universal Credit, by speaking directly to the individuals who will have to deal with the new system.
Notes to editors
- The Citizens Advice Managing Migration Pilot was carried out at three bureaux with diverse client base spreads. Experts at Birmingham, Ynys Mon and North Dorset assessed 3,460 clients for their Universal Credit relevance between 11 March and 14 June 2013. Out of 1,779 clients assessed as Universal Credit relevant, 1,644 were assessed as failing to meet a basic requirement across five different measures and therefore 'not ready' for Universal Credit. For a full methodology, see p 9 of the Citizens Advice Managing Migration Pilot: Baseline Results report.
- The Citizens Advice service comprises a network of local bureaux, all of which are independent charities, and national charity Citizens Advice. Together we help people resolve their money, legal and other problems by providing information and advice and by influencing policymakers. For more information in England and Wales see www.citizensadvice.org.uk
- The advice provided by the Citizens Advice service is free, independent, confidential, and impartial, and available to everyone regardless of race, gender, disability, sexual orientation, religion, age or nationality. For online advice and information see www.adviceguide.org.uk
- Citizens Advice Bureaux in England and Wales advised 2.1 million clients on 6.9 million problems from April 2011 to March 2012. For full 2011/2012 service statistics see our quarterly publication Advice trends
- Out of 22 national charities, the Citizens Advice service is ranked by the general public as being the most helpful, approachable, professional, informative, effective / cost effective, reputable and accountable (nfpSynergy’s Brand Attributes survey, May 2010).
- Most Citizens Advice service staff are trained volunteers, working at around 3,500 service outlets across England and Wales.