David Gauke, the new work and pensions secretary, has been urged to delay the mass rollout of the new universal credit benefit, after Citizens Advice produced fresh evidence that it is causing debt and financial insecurity among recipients.
The advisory charity surveyed 800 people who sought help with universal credit in pilot areas, finding 39% were waiting more than six weeks to receive their first payment and more than half (57%) were having to borrow money to get by during that time.
The report also detailed problems with the online application system and long waits to get help over the phone. It said nearly a third (30%) of those surveyed said they had to make more than 10 calls to the universal credit helpline during their application process, often having to wait over 30 minutes to get through.
The evidence from Citizens Advice is the latest in a long line of warnings about problems with universal credit, which involves wrapping six existing benefits into a single monthly payment.
Around two-fifths of the payments go to people in work rather than those who are unemployed, as it includes recipients of tax credits and housing benefit, as well as jobseeker’s allowance and disability benefits. The benefit is currently paid to around 530,000 people in trial areas but it this number will rise sharply in the autumn, when it is due to be rolled out to 50 new areas.
Earlier this year former welfare minister Lord Freud admitted to MPs that administrative problems and design issues with universal credit were causing about one in four low-income tenants to run up rent arrears, putting them at risk of eviction.
Freud, who has helped oversee the development of universal credit over the past six years, also suggested that the long formal waiting times faced by claimants before they receive a first payment when they move on to the new benefit should be shortened.
Citizens Advice is now calling not just for a pause in the rollout of universal credit until its problems are fixed but a reduction in the time period that people have to wait for their first payment and greater awareness of advance payment for those who cannot cope with delays.
It said it had supported more than 30,000 people with universal credit issues in the last year, with a quarter also needing help with debt issues. Gillian Guy, chief executive of the charity, said: “Universal credit is already failing too many people, pushing them into debt and leaving them without the means to make ends meet.