Opposition Day Debate, Universal Credit, House of Commons, Tuesday 5 December 2017

Local authorities continue to play an important role in managing the impacts of welfare reform in their communities, including the rollout of the Universal Credit (UC) Full Service. It is therefore crucial that councils’ concerns about the effect of the rollout of UC on residents and services are listened to by the Government.


Key messages 

  • Local authorities continue to play an important role in managing the impacts of welfare reform in their communities, including the rollout of the Universal Credit (UC) Full Service. It is therefore crucial that councils’ concerns about the effect of the rollout of UC on residents and services are listened to by the Government. 
  • The measures announced in the Autumn Budget are a welcome recognition of the considerable challenges presented by the initial waiting period for UC, particularly in relation to rent arrears. However, the proposed solutions, in particular the ‘transition to the UC housing payment’ through a continuation of Housing Benefit (HB), could place a considerable bureaucratic burden on councils. 
  • The Budget measures do not fully address the widening gap between people’s incomes and outgoings, and the resulting pressures on council budgets and services. The Government has focused on providing temporary uplifts in funding such as the increase in the Targeted Affordability Fund. While these measures are welcome, they do not address broader challenges in the welfare system, housing or employment markets. 
  • Many of the elements of UC continue to be delivered by councils. As a consequence of this, and successive changes to the scale and pace of the full UC rollout, councils face ongoing uncertainty about the size and duration of their Housing Benefit caseload. The Department for Work and Pensions (DWP) only funds around 50 per cent of the cost to councils of administering HB. Despite this shortfall, councils continue to deliver an effective service. It is vital that DWP recognises that UC is being delivered in partnership with local government, and fully funds local delivery. 
  • Councils also continue to provide a significant amount of support and advice to UC claimants, particularly those with complex or additional needs. DWP provides some funding to councils to deliver Universal Support, but this is narrowly defined. The local safety net enables claimants to successfully make a Universal Credit claim and should be appropriately recognised and adequately resourced by the Government. 
  • Independent research for the LGA found that the cumulative impact of welfare reforms to 2020 will lead to falls in real income for many households. It is therefore crucial that the Government works with councils to ensure that UC is effective in incentivising work and increasing income from employment.

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Opposition Day Debate, Universal Credit, House of Commons, Tuesday 5 December 2017