MPs urged to consider voting down new rules on universal credit

The Observer - 04 Nov 2018

The chair of a powerful House of Commons committee urged MPs last night to consider voting down new rules governing how three million benefit claimants will be switched to universal credit – amid fears the regulations will leave people worse off.

Frank Field MP, who chairs the all-party work and pensions committee, complained that ministers had refused to show MPs details of the new regulations, which they fear will plunge more claimants into poverty, and leave them struggling to cope under the new system.

Field told the Observer he was furious that his committee had not been given the chance by ministers to scrutinise the latest regulations, given the growing public concerns over universal credit and mounting calls for the system to be scrapped.

“If they had taken account of the most basic demands that everyone has been making, they surely would have shared these latest regulations with us,” he said, adding that if they did not go far enough to protect the vulnerable “then MPs will have no option but to vote them down”.

He went on: “Lots of Conservative MPs are upset about this, and I can’t see the Democratic Unionist party voting for something that will make people in Northern Ireland poorer. I think they’ll have real problems getting the regulations through.”

This latest row follows months of chaos in which long waits for payment and processing errors have left tens of thousands of claimants in debt, rent arrears and reliant on food banks. Amid the uproar, Labour’s The shadow chancellor John McDonnell said last month that universal credit was “not sustainable” and that his party would scrap it.

Fears about the impact of the movement of millions more claimants on to the benefit have, in recent weeks, led two former prime ministers, John Major and Gordon Brown, to warn that mishandling the next phase of universal credit could lead to levels of discontent similar to those experienced during the introduction of the poll tax. The chancellor, Philip Hammond, announced measures in his budget last week to boost universal credit, including an extra £1bn over five years to protect existing claimants migrating to the new benefit.

But MPs also believe there must be vigilance before the next set of rules governing the terms that will apply to millions more claimants are pushed through. The first draft of the new regulations, published in June, stated that claimants would be sent a letter giving them three months to apply for universal credit before their benefits were terminated. People who missed the deadline would neither receive benefits nor any transitional protection. The plans sparked outcry from MPs and charities, who said this would cause many vulnerable people to fall out of the benefits system and plunge them further into poverty.

At a hearing on 18 October, Field’s committee asked the employment minister Alok Sharma to allow it to scrutinise the revised version of regulations before they were presented to parliament.

But in a letter to Field on 1 November, Sharma declined the request, stating that it would “diverge from the standard process” and delay the introduction of the regulations.

In his response on 2 November, Field said that “given the strength of concern” about the original proposals, he hoped the regulations had “changed beyond recognition”. He warned that there had been “no opportunity at all for anyone to scrutinise this version of the regulations that the department now plans to lay”.

The draft regulations have, however, been seen by the Social Security Advisory Committee (SSAC), which provides independent advice to the government. The SSAC has presented its report to officials but it has not been made public.

In a blogpost on 30 October, the SSAC’s chairman, Sir Ian Diamond, said he was concerned that “the proposals load an unreasonable level of risk on to the claimant”. “We fear that, in too many cases, they may be adversely impacted by the proposals or fall out of the social security system entirely,” Diamond said.

Universal credit will combine six working-age benefits, including income support, jobseeker’s allowance and housing benefit, into a single monthly payment. Field has fiercely criticised the scheme since it was spearheaded by Iain Duncan Smith in 2012, warning that it would “rot the soul” of the low paid.

The government announced in October that the full rollout of universal credit, which was meant to begin in the summer of 2019, would be pushed back to November 2020 at the earliest.

Field told the Observer that for universal credit to be considered a success, the rollout must be slow enough so that everyone could be safely brought on to the new system.

He added that no one should have their income cut. “But it’s not looking hopeful at the moment,” he said.

A DWP spokesperson said: “We consulted on these regulations for months, receiving feedback from over 400 stakeholders. During this time the work and pensions select committee had ample opportunity to provide comment but chose not to submit any evidence or offer feedback.

“These regulations, due before the House shortly, are designed to support people on to universal credit. They protect 500,000 severely disabled claimants and provide transitional protection for all those moving to universal credit, meaning that no one loses a penny at the point of transfer.

“Delaying these regulations would leave people on a punitive legacy benefits system that disincentives work and fails to pay people the benefits they are due – costing 700,000 families an average of £285 each and every month.”

Eleni Courea, The Observer