Carmichael calls for Universal Credit pause

Alistair Carmichael, MP for the Northern Isles, has challenged the Secretary of State for Work and Pensions to rethink the way in which Universal Credit works.

According to research by the Joseph Rowntree Foundation, the new benefits system, which has been gradually rolled out, is leaving almost 57 per cent having to borrow money in order to make ends meet. The research also showed that one in ten have to wait longer than ten weeks before receiving anything through the system.

 Speaking in the House of Commons, yesterday (Monday), Mr. Carmichael questioned Secretary of State for Work and Pensions the Rt. Hon. David Gauke MP about the implications of the Universal Credit rollout.

“Those of us who remember the chaos around the introduction of tax credits can see the good sense of a phased roll out to Universal Credit,” he said.

“But I have to say to the Minister that if we don’t learn the lessons from the pilots, then we risk losing any advantage we gain. 57 per cent of those who are applicants for universal credit are having to borrow money before their first payment, isn’t that alone enough to justify a policy change?”

In response, Mr Gauke said that he felt the Government were taking a sensible and pragmatic approach  in introducing Universal Credit.

“The system of advances is an integral part of Universal Credit, it has always been there, but we want to make that properly available,” he explained.

“No one who needs support should have to wait six weeks before they receive any support, and what we are doing is making clear that people can receive an advance of their first month payment. That is then deducted off their next six months payments, and that is helping people deal with the cash flow issues in that first month.”

 Following the exchange  Mr. Carmichael further expressed his doubts about the system.

“Universal Credit is clearly not working well on the ground,” he said.

“It must be wrong that three in every five Universal Credit claimants have to borrow money just to keep them afloat in the first six weeks of their claim. I welcome that the Minister has committed to ensuring that advances are properly advertised to claimants to ease cash flow problems, but there is more action needed to solve this issue.

Mr Carmichael believes that the provision of a free helpline, removal of the seven-day waiting period, and removal of the two child cap on benefits claims, are all essential steps if Universal Credit is to succeed in helping people back to work.

“I was disappointed that the Minister didn’t go further in his answer to commit to rethinking Universal Credit, and making it a system that works for struggling families across the country,” he concluded.