Opposition Day Debate on the rollout of Universal Credit, House of Commons, Wednesday 18 October 2017

Councils have raised concerns about the design and implementation of Universal Credit (UC) Full Service to date, in particular the impact of the initial waiting period and delays in claimants receiving their first UC payment.


Key messages

  • Councils have raised concerns about the design and implementation of Universal Credit (UC) Full Service to date, in particular the impact of the initial waiting period and delays in claimants receiving their first UC payment. Initial feedback from councils shows that this is resulting in a marked increase in debt and rent arrears. This has a detrimental impact on households and the ability of councils and social landlords to invest in social and affordable housing.  Local authorities have worked constructively with the Government on the transfer of responsibility for Housing Benefit into the UC programme. Councils will continue to have a substantial role in administering Housing Benefit, and is vital that councils’ ongoing responsibilities are fairly and accurately reflected in the funding provided to them.
  • Universal Credit brings together mainstream working age housing and employment benefits, and has the potential to enable claimants to manage better with fluctuating earnings. However, issues with existing benefits, such as the growing gap between the Local Housing Allowance (LHA) rate and private sector rents, are concerning. In light of this, we are calling for the LHA rate freeze to be lifted and for an urgent review of LHA before it is extended to the social sector in 2018.
  • Independent research for the LGA found that the cumulative impact of welfare reforms to 2020 will, without improvements to housing and employment support, lead to falls in real income for many households.1 It is therefore vital the Government works with councils to ensure that that UC delivers on its aims to increase income from employment. We have called for greater devolution and integration of employment and skills support, and a review of the UC taper rate.
  • Councils face significant challenges in providing support to both homeless households and those at risk of homelessness. The Government is listening to our concerns that UC is not currently suitable for most homeless households, where in the majority of cases the housing costs are met by the local authority. The proposed removal of temporary accommodation from UC is welcome, but the programme needs to be integrated with a wider, more effective approach to homelessness prevention.
  • Many vulnerable recipients of benefits have additional support needs. This presents a number of challenges for councils in supporting claimants of UC, as well as administering other housing costs and benefits. Getting the local safety net right is vital to the success of UC. The LGA has called for a review of the local safety net to ensure that the role of councils is both appropriately recognised and adequately funded.

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Opposition Day Debate on the rollout of Universal Credit, House of Commons, Wednesday 18 October 2017