Meeting of the Parliament 03 October 2017
Yes, I agree, but that amounted to £0.7 billion, compared with an initial £3 billion cut.
Research by the OBR shows that, by 2020, universal credit will take around £3.1 billion out of the pockets of the UK’s poorest families. Some estimates are even higher. A report from CPAG and the Institute for Public Policy Research suggests that, by 2020, two-parent families with children will be worse off, on average, by £960 a year, compared with the income that they could have expected in the absence of cuts to universal credit, and that single-parent families will be worse off, on average, by a staggering £2,380.
The white paper also promised that 900,000 people, including 350,000 children, would be lifted out of poverty. CPAG claims that the opposite is the case, with universal credit putting around 1 million children in the UK into poverty. I have mentioned those figures before in the chamber; I am doing so again, and I will keep repeating them until Conservative members of the Scottish Parliament and the UK Government understand the damage that they are doing to so many families and their children.
I turn to the waiting time for universal credit. Universal credit is paid monthly, and, currently, there is a seven-day waiting period and a further seven-day period before the payment is made. That makes for a waiting time of, at best, up to six weeks. How on earth did we come to design a system with a built-in delay of that length? The UK Government’s justification for it is that universal credit mimics work by paying monthly. Leaving aside the rather patronising idea that people who require support with their income need to be taught what work is like, that comparison is flawed. Many jobs still pay weekly or fortnightly, and very few jobs—if any—require the employee to wait for six weeks to be paid. Employers cannot simply pay someone weeks late with impunity, but that is what happens with universal credit, with payments coming in seven, eight or nine weeks late, or even later.
That puts huge strain on universal credit recipients and the services that are trying to help them. Citizens Advice Scotland reports that in areas where universal credit has been rolled out there has been a 15 per cent rise in rent arrears in comparison with a national decrease of 2 per cent, and an 87 per cent increase in crisis grant issues in comparison with a national increase of 9 per cent. Those figures should give the members on the Conservative benches pause for thought.
The Scottish Government is right to call for a pause in universal credit roll-out, as the Greens have done several times, and we will support the motion at decision time.
We support having a simpler, single benefit payment, which is the premise of universal credit, but not when that payment is already insufficiently low—and lower than what many of our citizens need—and not when that payment is less by hundreds, sometimes thousands, of pounds.
The analysis that I have offered today is shared by groups across the political spectrum. The Resolution Foundation, which is chaired by Conservative MP and former minister David Willetts, argues that universal credit now is different from the original proposal because of
“the increasingly tight financial restraints placed on it over recent years. These have involved more than just a reduction in the money available under UC, they have also altered the very structure of the policy—changing the composition of winners and losers and fundamentally damaging its ability to deliver against its purported aims.”
The UK Government should pause the roll-out of universal credit and rethink the cuts that are being made in it. With child poverty costing the UK economy billions every year, universal credit cuts, even viewed in the narrow fiscal terms so beloved by the UK Government, make absolutely no sense.
I move amendment S5M-08035.1, to insert, after “paused”
“; observes that the independent Office for Budget Responsibility has said that universal credit is ‘less generous on average than the tax credits and benefits systems that it replaces’ despite original assurances that ‘no-one will experience a reduction in the benefit they receive as a result of the introduction of universal credit’”.
16:02Motions, questions or amendments mentioned by their reference code.