We want the continued implementation of Universal Credit to be a success. Equally crucially we want the reformed welfare system as a whole to be a success, not just for Government, but for councils and, most importantly, for the people using it.
KEY MESSAGES
- We want the continued implementation of Universal Credit to be a success. Equally crucially we want the reformed welfare system as a whole to be a success, not just for Government, but for councils and, most importantly, for the people using it.
- To achieve this, the Government has to consider the impact of welfare reform holistically. The cumulative impact of the different changes to welfare cannot be ignored.
- With responsibility for delivering over 800 services to their communities, councils play an important role in managing the impact of Universal Credit and wider welfare reform for their residents.
- We cannot afford to isolate our approach to delivering any one particular service, without considering how this will impact on other parts of people’s lives.
- As well as the possibility that some individuals will be worse off under Universal Credit,[i] we know that rolling out Universal Credit carries both direct and indirect costs for local authorities.
- Where councils are able to evidence a direct cost impact from the implementation of Universal Credit this is being met by central Government through New Burdens funding. However, this funding is retrospective and therefore limits councils’ ability to conduct long-term financial planning.
- There are many indirect costs to councils of Universal Credit and welfare reform, for example in terms of housing and financial inclusion, which are not being fully met by Government.
- In the context of councils facing a £3.9 billion funding gap by 2019/2020 just to make sure they can continue to deliver existing public services at their current levels,[ii] the cumulative cost of rolling out Universal Credit, as it is currently planned, is unlikely to be sustainable for councils.
- The next phase of Universal Credit, ‘managed migration’, will impact on some of our most vulnerable residents. This is likely to exacerbate the challenges highlighted above and we are deeply concerned by the lack of engagement by the programme with the LGA and local authorities on how this will be implemented.
Read the full LGA briefing: Opposition day debate on Universal Credit House of Commons