Tag Archives: Unievrsal Credit

Lord Fraud’s Debt Trap Has Been Abandoned As He Begs Local Councils For Help

lord-fraud-freudIt now seems clear that Lord Fraud’s debt trap, under which claimant’s struggling to manage the new benefits system would be expected to pay for budgeting support, has been abandoned.

Last year the bungling toff launched a tender exercise for ‘financial products’ to help claimants manage the change over to Universal Credit.  Typically this was an attempt to hand over yet more of tax payers cash to profit hungry private companies who would be given the chance to run claimant’s financial affairs.  A range of proposals were threatened, including jam jar accounts and smart cards.

In a major u-turn, it now seems that this has all been abandoned and Lord Fraud is attempting to shift the problem onto Local Authorities.  With less than two months to go before the first claims for Universal Credit are processed, a major – if potentially disastrous policy – has been scrapped and nothing put in its place.

A document released by the DWP (PDF)  sees Lord Fraud begging local councils to help rescue him from the shambles by asking for help designing services for the most vulnerable claimants – something that should have been addressed months ago.

The appeal for help gives a hint of the shambles behind the scenes as DWP Ministers find out exactly why the benefits system was quite complicated.  With no prior understanding of the social security system, Lord Fraud really is making it up as he goes along.   Rent payments will be monthly, except when they won’t be, payments will always go direct to claimants, except when they go to landlords, the benefit will be digital by default except when it isn’t, and all Housing Benefit claims will be centrally handled by the DWP, except for the ones that won’t be.

Some of the more intractable problems, such as providing a broadband based service in an area that doesn’t have broadband cover, are glibly glossed over:

“Rural areas where broadband is not yet widespread may also present a special challenge here that will need to be managed with local support.”

What does he expect, fucking telepathy?

The only sliver of good news for claimants is that when the unravelling of Universal Credit begins in April this year, only a tiny number of claimants will be affected.  The initial pilot will only include new, single Job Seekers Allowance claimants in a few postcodes in Manchester.  These are claimants who by and large will have recently lost their jobs.  This pilot will tell the DWP nothing about how Universal Credit will work in practice with groups which require more support.

Millions of people’s live are set to be plunged into chaos as Universal Credit is expanded over the next few years.  The ongoing comedy show at the DWP will be anything but funny as Lord Fraud and Iain Duncan Smith’s bungled reforms demolish what’s left of the welfare state.

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2 Million Face Rent Arrears Due to New Benefits System Admits Lord Fraud

Almost half of all claimants of Universal Credit feel they will be unable to manage their money when the new benefits regime is introduced next year research has revealed.

Universal Credit will replace all out of work benefits, housing payments and in work benefits such as Working and Child Tax Credits.  Unlike the current system, all payments will be made monthly, whilst there will no longer be an option to have rent paid directly to landlords.

This has led to concerns that those already on pitifully small incomes may have difficulties managing budgets and may fall into further poverty and rent arrears due to the changes.

The DWP are currently carrying out pilots projects to test the new payments system and the transition to monthly, online only benefits administration.  Predictably they are refusing to reveal the exact results of these projects.  What they are prepared to tell us reveals why.

Ever the optimist, Lord Freud, the Minister for Welfare Reform, claims that just 54% of claimants feel they will manage the transition to direct payments – when housing benefit payments are no longer sent direct to landlords.  The number of people claiming Housing Benefits, which is available to those in and out of work alike, is over 5 million.  What scant information has been revealed from the pilots suggests that around two and a quarter million people may fall into rent arrears due to the implementation of Universal Credit.

Astonishingly Lord Fraud attempts to spin this as a good thing, although concedes that ‘more work is needed’.  Perhaps of most concern is that the study appears to have been carried out using social housing tenants, where rents are lower and some support is already available through housing offices for struggling tenants.

In the private sector, where rents are soaring and landlords can evict tenants at the drop of the hat, the impact of Universal Credit is likely to be even more devastating.

Along with a toxic combination of housing benefit cuts and rocketing rents, the impact of this Government’s flagship welfare reform increasingly look like levels of homelessness never before witnessed in the UK.  This social deficit, of poverty, poor housing and desperation, is the real legacy that Iain Duncan Smith and Lord Fraud are leaving to the next generation.