Poverty and Inequality

22.11.17

Government releases £1.5bn to support roll-out of UC in Budget U-Turn

The chancellor has today U-Turned on the controversial Universal Credit policy, as he announced a £1.5bn package that will be used to deal with issues created by the roll-out.

In particular, the fund will be put towards cutting down the waiting time for payments by one week, from six down to five.

This decision will come as a welcome step forward for critics of the policy, who have recently described UC as “not fit for purpose”, “failing”, and to blame for rising rent arrears and food bank usage.

Despite this, Hammond’s Budget paper still said that UC was working, saying: “more people are moving into work within 6 months under Universal Credit than in the legacy system.

“The government is committed to ensuring Universal Credit supports people in work, which is why at Autumn Statement 2016 the government reduced the Universal Credit taper rate.

“The taper rate will be kept under review and the government will continue to consider the case for further changes.”

Immediately after Hammond’s speech, opposition leader Jeremy Corbyn argued that the change did not go far enough, as he called for the roll-out to be paused entirely.

His colleague shadow minister Andrew Gwynne continued by saying that the decision was a “screeching U-Turn,” going on to say: “Nice of Hammond to acknowledge this was only done because Jeremy Corbyn and Labour pushed the issue up the political agenda.” 

A number of organisations have welcomed the change. Jo Miller, president of Solace, an organisation that represents CEOs and senior managers in councils across England said: “The announcements about the changes to Universal Credit certainly indicate that the government is now listening to what we and others have been saying about the dangers inherent in its original policy design.”

The chief executive of Citizens Advice Gillian Guy has also stated that the reform is a “very welcome step” towards fixing the problems caused by UC.

“These changes should make a significant difference to the millions of people who will be claiming Universal Credit by the time it’s fully implemented. We’ll continue to keep a close eye on the roll-out of Universal Credit and make sure they do,” she added.

“The next step will be to make changes to work incentives, so that no one is left worse off under Universal Credit than they would be under previous benefits.”

Top Image: Helen Cobain

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